Shareholding Ministers of Timberlands West Coast Limited have formally accepted the economic viability of Timberlands' proposed sustainable beech management plans.

SOE Minister Tony Ryall has today informed Timberlands that the Government has accepted the conclusion of the Board of TWC that the sustainable harvesting of the Crown's West Coast beech production forests is commercially viable.

This means the last Government hurdle for the management plans has been passed and beech production can now commence within the Grey Valley area. Further north, in the Buller region, Timberlands will need to seek resource consents from local authorities before work can commence.

"This is a significant step forward for sustainable forestry and the West Coast region. It means that Coasters can begin using local resources sustainably for jobs and investment," said Mr Ryall.

"In December last year the Government announced that it would legislate to end unsustainable logging of rimu in the Buller six years earlier than originally agreed to by Mr Goff and the Labour Party.

"At the same time we said we would support Timberlands' sustainable beech management plans subject to being satisfied of their economic viability. The Ministry of Agriculture and Forestry, in consultation with the Department of Conservation, has already certified the plans as meeting the sustainability criteria of the Forests Act.

"Now, CCMAU and The Treasury have audited and reviewed Timberlands' business case for sustainable beech production. Officials have advised that the business case is conservative and is economically viable.

"The business case is premised on forecast beech production of : 4,000m3 in 2000; 10,671m3 in 2001; 20,147m3 in 2002; 29,707m3 in 2003; and, 39,500m3 in 2004.

"There has been a great deal of nonsense talked in the past about sustainable beech forestry on the West Coast. Labour has been particularly trite and misleading in its comments.

"In September 1998 Helen Clark said that no market existed for beech timber. That wasn't true then, and it is not true now.

"She said Timberlands' plans go far beyond the spirit of the West Coast Accord. That's not true either. When Labour signed the Accord a beech scheme logging at least 137,000 cubic metres of beech per annum was envisaged (pages 15-18, Final Report of the West Coast Forest Working Party, October 1986).

"Then Ms Clark said sustainable forestry would be disastrous for the region's ecology and economy. That's also not correct.

"On average Timberlands will harvest, by helicopter, just one tree per hectare per year. The forest will be closely monitored and management adjusted over time to ensure negligible impacts on native fauna and flora.

"Importantly, sustainable beech forestry will, over time, reduce our dependence on clearfelled tropical forests currently being mowed down in countries like Brazil and Indonesia and imported to New Zealand to replace diminishing supplies of rimu. And, despite being self-sufficient in plantation timber for many years New Zealanders have continued to import tropical timber from clearfelled rainforest.

"Sustainable beech forestry was also the fundamental principle underlying the 1986 West Coast Accord, a document about which Helen Clark herself said in June 1990 "it is absolutely essential that we keep faith with existing [environmental] agreements".

"If Ms Clark has any personal integrity, concern for the global environment and empathy with depressed areas of provincial New Zealand, she will welcome today's announcement for what it is - an economically viable, truly sustainable use of natural resources here in New Zealand.

"I congratulate the people of the West Coast and thank them for their patience. A sustainable forestry industry has been a very long time coming for them," Mr Ryall concluded.

ENDS

Changing The West Coast Accord Strategy: Questions and Answers

What Is The West Coast Accord?

In 1986 the Crown, environmental groups, timber industry groups and local authorities signed the West Coast Accord. The Accord allocated West Coast indigenous state forests to preservation (181 000 hectares) or sustainable timber production (130 000 hectares). The Accord also provided for a transitional period so the industry and West Coast communities could adapt to the change to sustainable management of indigenous forests and an increased reliance on exotic plantation timber. These transitional arrangements (or unsustainable overcuts) have now ended in all districts of the West Coast except the Buller district where the overcut was expected to continue until 2006.

What Is The Buller Overcut?

The overcut allows TWC, as the Crown's agent, to harvest more rimu than the forest can regenerate in a reasonable length of time. Doing this means the composition and ecology of the forest are significantly changed.

What Is Timberlands West Coast Limited?

Timberlands West Coast Limited (TWC) is a state owned enterprise appointed to manage the Crown's exotic and indigenous forests on the West Coast. The company, as the Crown's agent, is required to implement the Crown's obligations under the Accord, but it is the Crown and not TWC that is a signatory to the Accord. Like all SOE's the company is required by the SOE Act to work to maximise the value of the company.

What Has The Government Decided?

Following extensive consultation, the Government has decided that the unsustainable harvesting of the Buller forests will come to an end on 31 December 2000, six years ahead of the end date that was expected when the Accord was signed in 1986.

Accord Forests Will Be Subject To The Part IIIA Of The Forests Act

The Buller Accord forests will come under Part IIIA of the Forests Act after the overcut ends on 31 December 2000. All other Accord forests (not subject to the Buller overcut) will come under Part IIIA as soon as the necessary legislation can be enacted. Part IIIA was added to the Forests Act in 1993, and it is the section that requires sustainable management of indigenous forests. The Accord forests were originally exempted from Part IIIA in recognition of the Crown's obligations under the West Coast Accord.

Government Agrees In Principle To Sustainable Beech Production

The Government has agreed in principle to the production of timber from sustainably managed Accord beech forests. This agreement is subject to Timberlands' demonstrating the commercial viability of sustainable beech production.

There has been a six week opportunity for the public to make comments on Timberlands' beech management proposals. The Government received 12,354 submissions. Of these an independent consultant assessed 36 submissions as 'substantive'. The Government received some useful suggestions, and will implement some changes immediately, including the appointment of an independent ecological auditor, to audit Timberlands' environmental performance. Other suggestions require more analysis and will be discussed between the Government, Timberlands and other experts.

What Will The Decisions Mean?

The early end to the Buller overcut will stop the harvest of around 120,000 cubic metres rimu timber. It will reduce the national supply of rimu by around 40 percent per annum and will result in substantial environmental gains.

Bringing the Accord forests under the Forests Act will mean that the rules that apply to nearly all private forest owners will also apply to the Crown. It will also bind Timberlands, by law, to ecologically sustainable management, and will require Timberlands to protect the forest even if the company decides to halt timber production after only a few years.

The implications of the Government's decision to allow sustainable beech production is covered in a separate Question and Answer sheet.

Will People Lose Their Jobs Because of the Decision?

The 31 December 2000 end date will provide time for alternative timbers such as locally grown radiata pine and sustainably produced rimu and beech to substitute for the loss in overcut rimu. This will minimise the effect of the early end of the overcut for people employed in sawmills, furniture manufacturers, forestry and transport companies, etc.

Will The Early End Of The Buller Overcut Breech The Accord?

The Accord's objective was to provide for sustainable indigenous forestry in perpetuity. The overcut was only a transitional arrangement, and was not part of the legally binding conditions of the Accord. Because of the 1993 amendment to the Forests Act, virtually all other private forest owners can only produce native timber from a sustainably managed forest. This has improved the viability of sustainable management to the point that such a long transition is no longer considered necessary.

In addition a number of other factors mean that a 2006 transition is no longer necessary. For example: the sawmilling industry is no longer as dependent on indigenous timber; logs can be transported economically both between West Coast districts and into the West Coast from regions such as Nelson and Christchurch.

Why Doesn't The Government Stop The Overcutting Now?

Ending the overcut will reduce the supply of rimu in New Zealand by 40 percent. Most of this rimu goes to furniture and joinery manufacturers. These businesses will need time to adapt to new timbers as substitutes for the overcut rimu. Two years is considered a minimum.

Why Hasn't The Government Stopped The Overcut Until Now?

The High Court had ruled that the Crown had a contractual commitment to continue the Buller overcut until 2006.

But in May 1997 the Court of Appeal overturned that finding and concluded that continuing the Buller overcut is a matter of government policy not a contractual obligation under the Accord. This has cleared the way for government to reconsider the future of the Accord forests.

The Government has conducted an extensive consultation process before making its decision to end the Buller overcut six years ahead of schedule.

ENDS

Sustainable Management of the West Coast Accord Indigenous Production Forests: Questions and Answers.

What Is Sustainable Management Of Indigenous Forests?

Sustainable management is managing the forest so that landscape, cultural, ecological and amenity values are maintained and enhanced and through low impact harvesting, provide for a non-diminishing timber harvest in perpetuity.

The Forests Act requires private indigenous forest owners to manage their forests under stringent ecological sustainability criteria if they wish to produce timber. In the past Timberlands West Coast Limited (TWC) was not bound by the Forests Act as it was required to meet certain obligations under the West Coast Accord. However, TWC's beech management plans have been assessed as if they were under the Act. The Ministry of Agriculture and Forestry's Indigenous Forestry Unit has certified that TWC's management plans do indeed meet the requirements of the Forests Act.

Aren't We Running Out of Indigenous Forests?

There are 6.38 million hectares of indigenous forest in New Zealand. This is 24 percent of New Zealand's total land area.

The Department of Conservation administers 4.92 million hectares or 77 percent of New Zealand's natural forest area. This forest can never be harvested.

Of the remaining forest, 1.32 million hectares is owned privately. The West Coast Accord production forests make up 0.13 million hectares or 2 percent of our natural forest area.

Will Native Birds, Plants, Fish And Insects Be Harmed By Sustainable Management?

The Forests Act requires a sustainable management plan to specify how the forest will be protected against pests, stock, fire and any other threats and any measures necessary to retain and enhance flora, fauna, water and soil quality.

TWC has completed comprehensive bird surveys to identify distributions of bird species and recommend appropriate management responses. Far less is known about the invertebrate fauna of New Zealand's forests, however, some research on potential effects and risks is underway.

Under Timberlands' plans, effects on indigenous fauna, particularly birds, will be mitigated through: predator control (predators are by far the greatest threat to our indigenous fauna); ongoing predator research to improve control; reserving trees and areas of particular ecological importance; riparian strip reserves to protect fish; retention of the oldest and largest trees to die naturally and provide nesting sites; timing operations to avoid nesting seasons; banning dogs in forests with known kiwi habitats.

In addition the plans are conservative in that less than half of the estimated natural forest growth increment will be harvested, thus maintaining natural mortality processes in the forest.

As a final level safety check, the Government has agreed to appoint an independent ecological auditor, to regularly audit Timberlands' environmental performance.

Have TWC's Beech Plans Been Available For Public Comment?

The Government made the full plans available at major public libraries and via the internet (http://www.maf.govt.nz/Forestry). Summaries of the plans were also made available on request. Over a six week period the Government sought the public's comments on the plans. 12,354 submissions were received in total. Of these 36 were assessed by an independent consultant as being substantive. Some excellent suggestions were made and the Government has already moved to implement some of these. Other suggestions require further analysis and the Government will be discussing these further with TWC and other experts.

Why Doesn't The Government Stop Harvesting All Native Forests On Crown Lands Altogether?

There are 6,384,000 hectares of native forest in New Zealand. 5,061,000 hectares of this is Crown owned. 4,919,000 hectares (97%) of Crown forest land is permanently protected in the DOC estate. 142,000 (3%) is available for sustainable timber production under strict ecological rules. Under these rules the forest ecology will be protected, so there is no sound ecological or conservation reason to prevent sustainable timber production from the remaining fraction of forests.

By making this tiny fraction of the Crown owned native forests available for sustainable timber production, we ensure future generations of New Zealanders have access to our beautiful native timbers. The Crown is also fulfilling its commitments under the West Coast Accord. By placing strict rules on the sustainable production of timber and by managing the vast majority of our indigenous forests solely for conservation, we ensure protection of our unique indigenous forest environment forever.

The Government made a deal with the people of the West Coast, conservation groups, local bodies and the timber industry that 180 000 hectares of former NZ Forest Service West Coast forest would go to conservation and 130 000 hectares would be available for production. Of the 130 000 hectares of production forests, 100 000 hectares was to be available for sustainable timber production in perpetuity.

Why Produce Beech - Is There A Market For Beech Timber?

Industry reports suggest that there is a strong demand for beech timber, particularly for premium uses such as furniture, exposed flooring, decorative panels and joinery. The development of a large market for the timber is constrained by the present lack of supply rather than a lack of demand.

The market for beech timber is small at present. The speciality markets (furniture, panelling, flooring, joinery, etc) have traditionally been dominated by podocarp timber such as rimu.

The harvest of indigenous timber has fallen sharply from 643 000 cubic metres in 1986 to 73 000 cubic metres in the year ended December 1997. This decrease is placing pressure on speciality timber users to find alternative timbers. Harvesting of rimu is expected to continue to fall, particularly following the cessation of the Buller overcut.

Demand for beech timber appears to be particularly strong in Australia, Asia and America, and it is anticipated that initially a significant proportion of New Zealand’s beech harvest could be exported. However, as podocarp (mainly rimu) supplies continue to decline and New Zealand processors improve their beech processing techniques, it is likely domestic demand for beech will increase.

Can Beech Timber Be Successfully Processed?

Well established techniques for milling and drying beech are available. These techniques minimise losses during processing and produce high quality hardwood timber suitable for a wide range of uses. Once dry, beech timbers are amongst the most stable timbers in the world.

Beech timber is more difficult to process than many softwood timbers such as radiata pine or Douglas fir. The greatest challenge is to dry the timber without excessive losses.

However, timbers with similar processing problems, such as oak, are successfully milled and dried around the world. Beech has also been processed and dried in New Zealand for many years.

Aren't Alternative Plantation Timbers Readily Available?

In 1996 New Zealand harvested around 16.8 million cubic metres of exotic timber. Of this around 20 000 cubic metres was speciality timbers, likely to substitute for traditional indigenous timbers. The rest was general purpose timbers such as radiata pine and Douglas fir or pulp timber such as some eucalypt species. While radiata pine will fill some of the traditional indigenous timber markets, it is highly unlikely it will replace speciality timbers in applications such as exposed wooden flooring or high quality furniture.

As New Zealand’s indigenous timber harvest continues to fall (down from 361 000 cubic metres in the year ended March 1991 to 110 000 cubic metres in the year ended March 1997) the importation of speciality timber products has been steadily increasing, up 200 percent from NZ$57 million to NZ$114 million over the same period.

It is probable that without adequate supplies of indigenous timber, imports of speciality timbers and finished products will continue to increase. A significant proportion of imported speciality timber products are sourced from countries with little or no controls over harvesting levels or techniques. It is likely therefore that by failing to supply our own (sustainably produced) speciality timbers, New Zealand would in effect be contributing to natural forest destruction in other parts of the world.

There is a large private indigenous forest estate that could, theoretically, supply New Zealand's speciality timber needs. However, the Government has been advised by both furniture manufacturers and private forest owners that in order for manufacturers to commit to using sustainably produced alternatives to rimu, they first need a continuous supply of reasonable volumes of timber. Such supplies are at present only available through TWC.

Would Sustainable Timber Production From Natural Forests Impede New Zealand Companies’ Attempts To Gain International Sustainability Certification

93 percent of the world's timber harvest comes from natural forests. Most of this is unsustainably harvested. New Zealand has been very active internationally promoting sustainable forest management. If we abandon the concept of sustainable management of native forests in New Zealand we would have very little credibility in international forums and may well damage our ability to influence debates on making forestry more sustainable globally.

Is Sustainable Management of Indigenous Forests Proven?

Since the arrival of humans, New Zealand’s indigenous forests have largely been exploited with little or no attempt at any form of sustainable management. In recent decades much more study has gone into the sustainable management of NZ natural forests. In Europe sustainable use of natural forests has been practised for centuries. Many of the principles evolved in Europe can be applied here in New Zealand.

Is It Possible To Manage A Forest For Timber Production And Retain And Enhance The Natural Ecological Processes And Genetic Diversity Of That Forest?

In Europe forest ecosystems have been managed for centuries to achieve this. Typically, New Zealand species are even better adapted to sustainable management as they generally have had to cope with a range of natural catastrophes (such as storms, floods, fire, earthquake, volcanism) that are not as frequent in Europe. Our forest species regenerate strongly and are well suited to sustainable management. Controlling introduced pests is normally essential to maintaining and enhancing the natural forest ecosystem, which is why it is required as an integral part of a sustainable management plan.

The Accord Forests Are Lowland Forests, Aren't These Under Threat?

There are around 780 000 hectares of low altitude native forest on Crown land on the West Coast alone. 650 000 ha (83%) of this is administered by the Department of Conservation. 130 000 ha (17%) is administered by TWC. The vast majority of forests administered by TWC must be sustainably managed under strict rules that protect the forests ecological values.

Doesn't The Future Of The West Coast Lies In Tourism Not Forestry?

Any sound economy should based on a range of sectors. Tourism, forestry, agriculture, fishing and mining all have an important role to play in the West Coast economy.

1,775,800 hectares of land on the West Coast, or 80 percent of the total West Coast land area, is already managed by the Department of Conservation. It is most unlikely that adding 100,000 hectares of Accord forests to this estate would attract any additional tourism income to the West Coast.

In addition Timberlands West Coast has indicated that it will allow access to the forests it administers. Under Timberlands' proposed management plans, the managed forests will, to all intents and purposes, look no different to those forests management by the Department of Conservation.

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