The Land Online Blog - first published on Wednesday 18 June 2014

Environmental awareness group Planet Ark promotes the line: Make It Wood – Do Your World Some Good. In a world of the one-line grab, it’s effective.

The not-for-profit organisation’s Make It Wood Campaign highlights both the renewable nature of wood and its capacity to store carbon. It rightly points out that substituting wood for energy intensive products like steel, concrete and bricks is good for our planet. Hard to argue with that!

This campaign is also good news for Australia, where we want to continue to be a country which makes things. Australia is well placed to be a major provider of wood and fibre products to an increasingly wealthy and product-hungry Asia. But it will only happen if we are smart about it.

I’ve long talked a lot about the Asia-led 'Dining Boom' – the opportunity to capitalise on Australia’s clean, green and safe food image and our proximity to the main source of booming food demand. But it’s now also timely to talk about the Fibre Boom – the opportunity to deliver wood products in to a market hungry for just about everything.

The things we manufacture in Australia will now never include things like T-shirts, or indeed motor vehicles. But we can continue to make things in areas where we have, and can build upon, our comparative and competitive advantages.

That is, we can’t compete on labour intensive products where our competition is paying workers $1 per day or where other costs of production are demonstrably against us. Nor should we try.

But we can compete where we have advantage over our key competitors. In the wood products industry, these advantages are significant.

The first of them is our proximity to a growing Asia market. The second is the local presence of both a skilled workforce and global wood-product based companies. The third is the potential to leverage off global carbon markets and biofuels incentives. The fourth is our well known and recognised capacity to innovate. The fifth is our capacity to responsibly source from naturally re-growing forests and to produce plentiful plantation timber.

It’s these last two points I want to dwell on in this limited space.

Like the Dining Boom, the Fibre Boom won’t be handed to us on a wooden platter. The competition will be strong and the victors will be those who have smart, long-term strategic plans in place. In collaboration with industry, government will have a key role to play.

As in dairy, so far our friends across the ditch have the march on us. They are increasing investment in forestry and wood products research and development while we are going backwards. For example the Rotorua-based and government-funded SCION (the equivalent of one of our co-operative research centres) is leading research not just in areas such as climate, biosecurity and forestry, but also driving new product innovation in areas like wood to fuels and wood to plastics.

Here in Australia, a recent bid to set up a similar research body quickly and dramatically fell victim to Joe Hockey’s budget axe and ideas mulcher.

If this is not problematic enough, the other bad news is we don’t have a plan to guarantee we won’t run out of timber, increasingly becoming more and more dependent on imported resources. To its credit, way back in 1997 the Ministerial Council on Forestry, Fisheries and Aquaculture (the Abbott government abolished SCOPI, its modern-day equivalent) endorsed the plantation industry’s target of trebling the plantation estate by the year 2020.

The so-called Plantations 2020 Vision offered the great promise of a threefold increase in tree-farm production putting us on the path to resource sustainability and greater self-reliance. The centrepiece of the strategy to realise this aspiration was the Managed Investment Scheme (MIS) policy which provided tax incentives for those investing in tree-farm projects which offer a return maybe twelve years down the bush track.

As is often the case with these schemes, the lorry wheels fell off due to a range of issues including poor policy design. Consequently, we are around one-third short of our target.

Is failure a reason to give up? I think not. It’s past time we had a new plan and a new strategy which builds on and consolidates us as a supplier of high-value wood-based products to the world.

Next month I’ll travel to Melbourne and while there will make some time to check out Lendlease’s Forte building in Docklands – the world’s tallest timber residential apartment block.

Nothing would make me happier than to one day travel to China to see timber buildings everywhere, made from Australian wood and furnished with wood-based bio-plastics created using Australians know-how and skills.

It could happen – but not without a plan. And so far, sadly, forestry hasn’t even made the government’s agriculture white paper.

This article was first published in The Land Online Wednesday 18 June 2014.

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