Chinese demand is transforming Tasmania's blue gum industry

Friday 2 May 2014

Years of controversy, division and failed managed investment schemes have finally turned to prosperity for the Tasmanian blue gum industry in SA’s Southeast, as export demand for woodchips rises rapidly reports the Advertiser.

Boosted by heavy Chinese buying, the harvesting of blue gums in the Green Triangle region of South Australia and Victoria has increased revenue from AU$75 million in 2012 to about AU$170 million last year, rising to an estimated AU$250 million this year.

The whole community is benefiting as jobs rise rapidly in harvesting and hauling companies, at fuel suppliers, mechanics and tyre suppliers, as they benefit from the rising fortunes of the industry.

Behind the rapid growth is demand from China to make fine writing, copy and tissue paper, to create rayon for nylon shirts and cellophane wrapping paper, and to produce high-quality cardboard for perfume and cigarette boxes.

Green Triangle Regional Plantation Committee chairman Laurie Hein said the Tasmanian blue gum industry has been transformed from doom and gloom to a vibrant forestry sector, creating jobs and a rising sense of optimism.

He said the need for harvest contractors, freight companies and other service providers along the whole supply chain has risen strongly in the past year as the level of harvesting has grown substantially to meet the Chinese demand.

“The resurgence in both the hardwood and softwood sectors has seen a migration of contractors from Tasmania and the mainland to the Green Triangle in the past year, which has been good for the region after a prolonged period of extremely challenging market conditions.”

The biggest bluegum producer and exporter is Australian Bluegum Plantations. Its managing director, Tony Price, said the industry was looking much brighter than before the market turned. “Back in 2011 we had two or three contracting companies working for us and now we have about 13,” he said.

Mr Price said the harvest had risen from an estimated 900,000 tonnes in 2012 to about 2 million tonnes in 2013 and potentially 3 million tonnes this year, as demand from China expanded rapidly.

Source: The Advertiser

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