Forest group seeks relief for industry in trouble

Wenita Forest Products chief executive David Cormack said his company was managing the situation...
Wenita Forest Products chief executive David Cormack said his company was managing the situation week by week. PHOTO: GREGOR RICHARDSON
A group representing forestry contractors has approached the Government for a relief package a "week away from the industry really falling to bits".

And the Forestry Industry Contractors Association chief executive Prue Younger said a call from the Finance Minister to move laid-off workers to conservation jobs in Southland is unlikely to solve a looming crisis for the industry.

The Minister of Finance, Grant Robertson, said options were being looked at for moving forestry workers to conservation jobs in Southland.

"It’s just not as easy and logistical as the minister may think, to lift people up and move them around," Ms Younger said.

"We’re talking about people with families moving from the North Island to the South Island," she said.

"I think he’s dealing with a small number of people that might be able to do that."

She said a survey to contractors three weeks ago showed a third were out of a job while another third were on reduced hours.

In the time since, she said things had got "significantly worse" for forestry contractors and expected a survey sent out yesterday to come back with results saying so.

"From indications of our questionnaire last week we’re about a week away from the industry really falling to bits. That’s total — that’s big, small and little contractors."

Forest owners had warned space for more logs to go into China was quickly disappearing and that meant production was stopping.

"It does sound quite extreme, but literally if forest owners aren’t putting wood on the water, which I know the ships have stopped and there’s extreme stocks on the Chinese wharves and the Chinese economy hasn’t started again, then you’d have to [ask] why would they risk putting uncontracted timber on the water?

"Forest owners and corporate forests don’t have a lot to lose ... their trees keep growing.

"But the contractors actually have got a huge amount to lose. They lose their businesses and they’re an industry where they’re reasonably high in debt, with heavy and very expensive equipment."

A request for a relief package went before Cabinet last Wednesday but it has been delayed twice since then to be considered today , Ms Younger said.

"I understand that that was pulled back because they didn’t want to set a precedent just for one industry, which I totally get.

"They want to look at it as an industry-wide, nationwide response"

The type of relief the industry needed was around Work and Income and possibly tax subsidies for workers, Ms Younger said.

"Basically, just make it important to understand we need to keep our crews going in some shape or form because otherwise they’re going to jump ship to another industry and when the things start ... righting themselves we’re going to be without workforce ... but in a very extreme manner I think," Ms Younger said.

Dunedin contractor Tony Gamble said his work for City Forests had been relatively stable.

"We’re on a 80% quota and everybody’s sort of managing that quite well.

"There’s other contractors in the woodlot sector that are probably doing very little and some possibly nothing at all."

He said his workers were working on producing four days a week and the fifth day was on maintenance.

Some workers were taking their annual leave, he said.

"We’re not completely shut down ... just tightening the belt, really.

"Managing our way through it [and] keeping an eye on costs and we should be fine, from a personal point of view.

"I’m sure a contractor on heavily reduced volumes and little to no future work will have a different point of view."

He said laying anyone off would be a last resort because "experienced guys are hard to find".

Wenita Forest Products chief executive David Cormack said his company was managing the situation week by week.

"The only thing I know is the situation’s constantly changing.

"We’ve got all our contractors working.

"Our harvesting, trucking and the contractors that work at the port ... they’re all working at reduced levels at the moment."

Mr Cormack was not planning on laying off workers.

"There’s been no redundancies and we don’t intend to reduce our contract workforce at all.

"We see this as a very temporary situation and once things get back to normal again we’ll be wanting every one of those contractors working at normal levels again."

The company was restricting production to daily quotas.

"They’re working on quotas ... we’re not working four-day weeks or anything like that. We’re working five days but they have strict limits on how much they can produce a day." — Additional reporting by RNZ

Add a Comment