Seems that FT and Gunns have come up with a 'new' agreement to supply chipwood to the new Pulp MIll from regrowth and plantation state forests, not old growth. However FT still intends to chip old growth forest to the tune of 500,000 tonnes a year and according the report below, some of that could end up in the mills power furnace.
http://www.theage.com.au/news/nation...301045759.html
FT's own releaseQuote:
THE proposed Gunns pulp mill in northern Tasmania will use about half the available timber from state forests, but none from old-growth forests.
Under a 20-year agreement reached by Forestry Tasmania and Gunns yesterday, the state will supply 1.5 million tonnes of pulpwood logs each year to the giant Tamar Valley mill.
But the state timber agency also disclosed that up to 500,000 tonnes of public old-growth forests would still be exported from the state each year as woodchips, despite construction of the mill. Forestry Tasmania's chief executive, Bob Gordon, said yesterday that Gunns would begin by paying $13.75 a tonne from January 1 for the wood.
When it shifted from exporting the chips to processing them in the mill, it would pay an average $17 a tonne over the life of the agreement, or about 25 per cent more than it now received for wood from regrowth forests, and an average $35 a tonne for plantation timber.
Mr Gordon said that although plantation timber had a much higher price, Gunns had an incentive to use it because it produced more pulp.
The agency's projections showed woodchipping of old growth continuing until 2016, then tailing off altogether 10 years later.
Premier Paul Lennon said the sawmilling industry needed to maintain access to old growth, but was moving away from it, and the woodchips were a residue that had to be used. The Wilderness Society's Tasmania's campaigns manager, Geoff Law, said it was evidence that the pulp mill would not end the lunacy of exporting resources.
"When it comes to old growth, if they don't pulp it, it will burn in the mill's power station or be chipped for export," he said.
The society this week took to the Federal Court its long-standing claim that a reckoning must be made of the Tasmanian pulp mill's effect on the island's forests.
In an appeal against the process used by the federal Environment Minister, Malcolm Turnbull, to assess the project, the society claimed that a judge erred in finding that Mr Turnbull was prohibited from taking into account the mill's adverse impacts on native forests and plantations.
The deal with Forestry Tasmania moves the $1.7 billion project another step closer to fruition.
But despite Gunns' optimism that building could start before December, Mr Lennon said he believed it would not begin until early next year.
He said Gunns was still trying to secure the finance to construct the pulp mill, and the mechanics of environmental regulations needed to be finalised first. The ANZ bank, the mill's potential financier, is continuing an independent technical review of the project.
Meanwhile, anti-mill protests continue. Locals have climbed to the top of a bridge over the Tamar estuary, near the mill site, to hang a banner that read: "Save our valley for the kids."
A group of protesters also carried a coffin filled with woodchips to Forestry Tasmania's front door.
http://www.forestrytas.com.au/news/2...ll-wood-supply
Quote:
The proposed Wood Supply Agreement between Gunns Limited and Forestry Tasmania will secure a long term future for the timber industry.
Forestry Tasmania and Gunns have reached written agreement on the pricing mechanism and quantity of pulp wood for 20 years, but the deal will not be executed as a contract for another month.
Forestry Tasmania’s Managing Director Bob Gordon said the release of the terms of the agreement was a watershed moment in the Tasmanian forest industry.
“In the past, these agreements have been kept confidential to protect the commercial interests of Forestry Tasmania and its clients.
“However, both Gunns and FT agreed to release the information, given the enormous public interest in the project, and the importance of it to the future of the Tasmanian forest industry.
“Forestry Tasmania harvests native forests and plantations to supply the industry with 300,000 cubic metres of saw and veneer log – but to continue to do so requires a long term market for pulp wood.
“The Heads of Agreement between Gunns and FT provides the long term security needed by the industry.
“Under the HoA, Forestry Tasmania will supply 1.5 million tonnes of pulp wood annually from regrowth forests and plantations for 20 years.
“The volume represents about half of the 2.8 million tonnes that is available from State forests each year,” Mr Gordon said.
“I am also delighted with the price and security that Forestry Tasmania has been able to achieve during the negotiations.
“It reflects a recognition by both parties that the community expected a fair and reasonable return for the state owned resource.
“The base price we will achieve is above current rates and will provide a secure income for FT for two decades, Mr Gordon said.
Key Outcomes of the Agreement
- 25 per cent price increase for regrowth pulpwood to around $17p/tonne
- 85 per cent price increase for plantation pulpwood
- FT’s operational profit forecast to rise by $15m to $20m
- Benchmarked to international pulp price
- floor price established to limit FT’s exposure to downward pressure on the international pulp price
- Provision for a third Rotary Peeled Veneer mill using logs that would otherwise be exported as woodchips
- New arrangements will provide improved security for contractors
- Security of supply for sawmillers and processors other than Gunns.
Mr Gordon said under the pricing mechanism, FT can take advantage from increases in the pulp price, but is protected from big falls.
“The price is significantly higher than the $12 to $14 predicted by uninformed commentators.
“As FT-owned plantations mature, the proportion of plantation wood compared to regrowth will increase in the years ahead,” Mr Gordon said.
“I want to make it absolutely clear the rate of harvesting in native forests will remain the same, irrespective of whether there’s a pulp mill or not.
“We do not and will not harvest native forests beyond sustainable levels.”
Mr Gordon said he was confident the major issues had been considered but FT would be consulting major industry stakeholders in the weeks ahead before finalising the arrangements.
“We have also commissioned an independent analysis of the pricing structure, which should be available in the next few days.”
