Concerns over Tasmanian forestry asset sale

Friday 4 Oct 2019

Concerns have been raised by the Australian Competition and Consumer Commission over a proposed sale of Tasmanian hardwood plantations owned by Resource Management Service. The company has made its plantations and a 30-per-cent share of its woodchip marketing and export business in the state open to competitive tender which has attracted interest from New Forests Asset Management and Global Forest Partners.

Acquisition by New Forests would mean New Forests would own 50 per cent of the state's hardwood plantations and could lead the company to because the only wood resource exporter from Burnie port, the ACCC said.

"We are concerned that the acquisitions could impact the viability of competing export channels for hardwood plantation chips in Northern Tasmania, which could lower prices paid to private growers of plantation logs," ACCC commissioner Stephen Ridgeway said. "We have the strongest competition concerns about the impact of the New Forests bid on exports from Burnie in Tasmania's North-West."

"The diversion of RMS' woodchips into the export operations linked with New Forests could jeopardise access to the export channels in Burnie by other market participants. This is likely to result in a reduction in buyers of plantation timber from private growers, reducing the price paid to growers."

He said there were further concerns that acquisition by either New Forests and Global Forest Partners could reduce export options at Bell Bay and weaken competition for timber from private growers. The ACCC has invited both parties to submit to its preliminary concerns. The commission will make a decision on the asset sale on 5 December.

Source: The Advocate



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