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17/2/2000 Plantation based economics of the current logging industry in NSW

In summary the following story in the Australian Financial Review, p27 17th February 2000, indicates:

  • the massive 550,000 m3/yr plantation sawlog industry around Oberon based on the existing plantation stockpile - dwarfing for instance the highly controversial native forest volume of 42,000m3/yr allocated on the NSW south coast, or 48,000 m3/yr at Tumbarumba/Tumut region;
  • the financial viability of the plantation stockpile as a long term investment - including for overseas interests;
  • indirectly, the incompetence of a vocal minority of industry/union/political leaders and bureaucrats in NSW promoting the sunset native forest sector and denying the role and existence of the much bigger plantation sector (without planting one more tree);
  • indirectly, the corrupt economic and social analysis driving the recent southern region forest assessment by the Resource & Conservation Assessment Council within NSW Dept of Urban Affairs & Planning to woodchip native forest for a further 20 years. That analysis ignored social justice packages in the plantation stockpile.

"CSR, Boral form vehicle for sawmill operations" 

By Damon Kitney

CSR and Boral ended more than two years of discussions on the rationalisation of timber interests in south-eastern Australia yesterday, announcing a new joint venture vehicle to run their sawmill operations at Oberon in NSW.

As revealed by The Australian Financial Review last month, both parties have agreed to make a $30 million upgrade to CSR's facility at Oberon to process timber from Boral's extensive high-quality timber resources in the area.

A major proportion of the $30 million will be contributed by Boral.

Capacity increases for the dry and green mills at the Oberon plant will increase annual throughput to about 550,000 cubic metres per annum, significantly improving the productivity of the joint operations.

Boral Timber's executive general manager, Keith Mitchelhill, said the new joint venture company would generate $85 million in revenues in its first year.

As part of the venture, Boral will close much of its Bathurst plant within the next four to six weeks.

The venture is subject to approval by the Australian Competition and Consumer Commission. CSR's chief executive, Mr Peter Kirby, welcomed the deal. However it is understood CSR is close to onselling the Oberon mill, and the groups's remaining solid timber assets at Tumut, NSW, and Caboolture, Queensland, to a foreign timber player most likely Weyerhaeuser.

Mr Kirby declined to comment on the sale."
in Australian Financial Review 17th February 2000 p27 

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