VicForests denies supply offer

VICFORESTS has denied claims that it told Australian Sustainable Hardwoods large quantities of Central Highlands timber were ready for harvest last year.

The Heyfield-based sawmill is at risk of closure due to a reduced offer of timber supply from the state-owned organisation when its current long-term contract expires at the end of June.

ASH is adamant former chief executive of VicForests Robert Green indicated 15,500 hectares of timber was then available during a meeting at Lancefield on 27 May, 2016.

ASH chief executive Vince Hurley said given those discussions, he was shocked by the shortfall in the new supply offer of 200,000 cubic metres in total over the next three years, when the mill needed a minimum 130,000 per annum to remain financially viable.

“The then CEO of VicForests on 27 May last year was very clear when he told members of the taskforce, myself and others, that there was 15,500 hectares of 1939 regrowth ready to harvest right now,” ASH chief executive Vince Hurley said.

“For VicForests to turn around and say the best they can do is less than half of our current contracted volume over three years, just six months later, doesn’t make any sense at all.

“The fact is that the commercial size of our operation simply does not work with half the contracted volume.”

However VicForests has said the presentation included disclaimers that some of the area specified could not be harvested.

“VicForests presented information to a number of groups in May 2016 showing that approximately 36, 000 hectares of 1939 regrowth forest are potentially available to supply timber to the Victorian hardwood industry, but also noted that not all of this area can be harvested due to regulatory and logistical constraints,” VicForests spokesman David Walsh said.

“The presentation did not discuss future supply volumes to the industry or any individual customers.”

Discussions between ASH, VicForests and the State Government are continuing this month, with a working group expected to begin offering expert advice from today.

The working group was appointed to explore how VicForests determines the availability of timber for harvest, the viability of an ASH proposal to re-tool its mill to process smaller logs as it transitions to plantation timber and how the endangered Leadbeater’s Possum impacts the availability of the resource.

ASH has requested State Government support for a $40 million re-tool of the mill but would still require short-term supply during the transition.

The ASH board will reconvene early next month to make a decision on the mill’s future.