Northern Rivers Private Forestry Development Committee Website

Commercial Development of Native Forest, Plantation and Processing Residues in Northern NSW

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EXECUTIVE SUMMARY

The Northern Rivers Regional Industry and Economic Plan has identified forestry as a key industry sector. A Timber and Forestry Industries Workshop in 2006 identified the value adding of thinnings and residues as the second highest priority for this industry sector. This project is the second stage of developing a business case for the value adding of small thinnings and residues. It builds on an investigation into the potential of the region’s hardwood thinnings for processing and production purposes undertaken in 2006 (Northern Rivers Private Forestry and Department of Primary Industries and Forestry Queensland). The aim of this latest project is to assess the potential availability of forest, plantation and processing residues in northern NSW and the logistical and infrastructure issues associated with the use of the resource.

There are about 580,000 hectares of native forest and 60,000 hectares of hardwood plantation available for timber production in the study area. About 225,000 hectares of the native forest and half of the hardwood plantation area is managed by Forests NSW and the remainder is privately owned and managed. Forests NSW also manage about 15,000 hectares of softwood plantation. There are about 80 sawmills and processing plants operating on a full time basis in the study area.

Given the location of the resource and the major concentrations of the processing industry, Grafton (the Grafton catchment) and Casino (the Casino catchment) have been identified as the two most logical sites for any new residue processing industries. There are possible alternatives to stand alone industries at the two sites, including expansion of existing markets such as export woodchip or electricity cogeneration or the development of a single processing facility at only one of the identified sites.

Based on a timeframe of 2008-2020, the estimated annual volume of available residues increases from about 480,000 tonnes in the Grafton catchment and 160,000 tonnes in the Casino catchment for 2008-2010 to about 900,000 tonnes and 520,000 tonnes respectively for 2016-2020. The primary driver for this increase is the expansion of the post-1994 hardwood plantation resource, including significant annual establishment rates by private companies since about 2000. The predicted volumes for 2016-2020 is also reliant on continued plantation expansion. Residue volumes are expected to comprise about 85-90% native forest and plantation residues and 10-15% processing residues. About 15-20% of the native forest and plantation residues will be small logs suitable for sawing, veneering or round wood and 80-85% non-sawlog material suitable for chipping or other processing.

There are currently no large-scale markets for residues from the region. Export woodchip out of Newcastle utilises some residue material from Grafton south. Some softwood woodchip is exported from Port of Brisbane and a trial shipment of hardwood woodchip is currently progressing. A relatively small volume of low quality logs from State Forest are sold for hardboard manufacture in south east Queensland. Processing residues are used for boiler fuel and by the landscaping, horticulture and poultry industries. There is potential for the expansion of some of these existing markets, particularly export woodchip out of Brisbane and increased use of residues for electricity generation by sugar refineries. Three potential new markets have been identified to utilise at least part of the available residue resource.

Recent trials showed that there is considerable potential for using small logs from plantation thinning and native forest silvicultural operations to produce sawn timber, plywood, hardboard, glued laminated beams, outdoor furniture components, roof trusses and round wood for structural and landscaping applications.

The production of biofuels from biomass, including wood residues, is receiving considerable research, development and investment attention both in Australia and overseas. With further development, biofuel production represents a potentially significant new market for native forest and plantation sawmill residues produced in the region and could be combined with the substantial residue resource produced from agriculture to produce the critical mass needed to run one or more biofuel plants.

The development of a significant, long-term hardwood export market out of the Port of Brisbane would provide an opportunity to utilise the available residue resource within the Casino and Grafton catchments. Depending on the size of the market, the establishment of centralised chipping facilities in the Casino and Grafton areas would warrant serious consideration. Both Grafton and Casino are ideally situated to utilise the rail network to access the Port of Brisbane.

Landed costs for residues into processing facilities at Grafton and Casino will vary with distance. In the case of plantations, piece size and type of operation (thinning or clearfall) will also impact on costs. Depending on the proximity of the resource to the processing site, it is expected that average landed costs for native forest and plantation residues will be about $55-$65/tonne and for processing residues about $30- $35/tonne. For some end uses such as burning for steam or electricity generation, the economics of sourcing residues beyond 100 kilometres may be marginal.

The condition of the local road network that provides the major access to the region’s native forests and plantations varies widely. Hardwood plantation expansion since 1994 has resulted in plantations being established in some areas where parts of the local road network may not have the infrastructure suitable for intensive use by heavy vehicles (albeit over short periods in many cases). In particular, the condition of timber bridges and road pavements may prove to be an impediment to log haulage.

At projected rates of hardwood plantation establishment, by 2020 the size of the resource could be about 120,000 hectares. With the plantations established in the mid- 1990’s due for thinning now and an ongoing program of thinning and clearfall as younger plantations come on stream, infrastructure will need to be addressed urgently. Regional Plantation Infrastructure Planning Committees established under the Plantations and Reafforestation Act 1999 were charged with planning the infrastructure needs of the plantation industry at a regional level. The Upper North Coast Committee has not met for some time and it should now be reconvened. The first task of the Committee should be to identify and prioritise the immediate infrastructure needs of the industry to cover the commencement of harvesting operations in the near future. The ongoing task would be forward planning for infrastructure needs as the remainder of the plantation estate comes on stream.

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