Boycott Woodchipping Campaign
Boral Ltd Corporate Profile
Boral dominates the timber industry in NSW. It owns 60% of the timber quotas in NSW - 75% in northern NSW. In the area around Kempsey, Boral holds 94% of the quotas. Boral's Timber Division has the greatest access to timber on the north east coast of NSW from Wyong in the south to Grafton in the north.18
Boral have a legally binding contract with State Forests (the NSW Government forestry agency) called a long-term Wood Supply Agreement. The agreement deals with quota sawlogs. These are logs which have to be of a certain size and quality. They generally represent the highest quality logs cut in any given forest. The agreement means that State Forests are legally bound to ensure Boral has access to most of the best timber in north east NSW. Some of these Agreements last up to 20 years.19
Because most of the premium quality timber resources in North East NSW go to Boral, small millers are being forced out rapidly by this major player. For instance, when Wild Cattle Creek State Forest near Dorrigo was logged in 1994 timber was trucked hundreds of kilometres to Boral Mills in Grafton and Kempsey to the detriment of local millers.20 Sawmillers around Wauchope complain of not getting enough timber because Boral takes almost everything. Many mills have been forced to close and, in our opinion, if Boral's Wood Supply Agreement continues, this trend may persist resulting in the remaining mills suffering a similar fate.21
In addition loggers wanting timber quotas for a higher end use have to pay more than those wanting the timber for woodchips.22
Salvage logs are those that remain after the woodchip quality logs have been removed. These logs are often 'salvaged' by the smaller operators. In the Dorrigo district, the requirements for classing logs as woodchip quality are becoming less stringent, resulting in logs that used to be called salvage now being woodchipped. This has been done to meet State Forests' obligations to Boral, and results in even less timber for the smaller mills.21
Since the Boral takeover of Duncans sawmills this market dominance has increased. The North East Forest Alliance (NEFA) complained to the Trade Practices Commission that this takeover and resulting market dominance of the timber industry in NSW was not in the best interests of the timber industry, the workers or the public. Boral's market dominance also effects State Forests' pricing strategies, other Sawmillers, local timber markets, and to some extent, state timber markets.23
By gaining such huge quotas and the attendant "resource security", the public forests are being destroyed almost for the sole benefit of a single multinational company.
Several green Groups have investigated the legality of the State Government breaking the long term Agreements with Boral. Legal advice from several solicitors suggests that the Government can legally disengage from the Agreement.24
SEPL
SEPL obtains timber sourced from a number of high conservation value forests in northern NSW. While SEPL claims that it only takes sawmill "waste" large percentages of timber "residue" ends up as woodchips. In the Wingham Management Area for instance, 50% of timber - including sawmill residue - goes to woodchips.13
In June 1993 NEFA advised the Independent Commission Against Corruption of a possible conflict of interest. They drew attention to Mr Roy Allen Free being both a member of SEPL board of directors and an Assistant Commissioner for the Forestry Commission for four years from 1985 to 1989. The monopoly in quota sawlogs that Allen Taylor & Co (a wholly owned subsidiary of Boral and the largest sawmilling company on the North Coast) now has may have resulted from decisions made by Forestry Commission of NSW at a time when Mr Roy Allen Free was associated with both.25
While Mr Free was director of SEPL and assistant Commissioner of the Forestry Commission, Allen Taylor & Co negotiated and signed three Wood Supply Agreements covering periods of twenty years each with the Forestry Commission. The volume of timber involved totalled 2,271,600 cubic metres. NEFA's letter raised the potent question "what decisions that may have benefited SEPL, Allen Taylor & Co or Boral, did Mr Free participate in while he was in his dual role acting for industry and government?". An ex Forestry Commission employee, Mr John Gwaelter, said that during the period when Mr Wal Gentle was Commissioner of forests and often absent through ill health, Mr Free, as Assistant Commissioner, virtually ran the Forestry Commission single handedly. Hence Mr Free would have played an integral part in the negotiation of wood supply agreements.25
There are several ways in which State Forests shows favouritism towards Boral. According to a letter sent from from Nefa to the ICAC, when Boral purchases and closes a sawmill with a current quota, the quota is transferred to Boral, but this may not have occured for any other sawmill operators.25
According to the NEFA letter,a contractor who was employed by SEPL has said that as a SEPL contractor he received preferential treatment from the Forestry Commission over other non-SEPL contractors. For instance if all contractors complained about the state of deteriorating roads in wet weather, only those used by SEPL-employed contractors would be repaired.25
In June 1995 the State Government of NSW announced its intentions to enforce a 30% cut in sawlog quotas from north east NSW. This decision was made in order to try to compensate for the massive overcutting that has taken place in the region. In our opinion, it is likely that this cut may badly affect some of the smaller mills and mill closures on the North Coast are possible, but the cuts are unlikely to affect Boral so significantly. Factors such as this, as well as mismanagement and increased woodchipping, are resulting in the sawlog timber resource on the north coast becoming increasingly scarce. As this occurs, the remaining smaller mills stand no chance of gaining secure access to timber in the face of the government's legal obligations to Boral.26
At the beginning of 1996 the Federal Government issued the year's export licences with an overall cut to woodchip exports across Australia. This cut will not have a major impact on SEPL, because while it has a licence for 500,000 tonnes p.a., it has never exceeded 345,000 tonnes p.a., usually exporting between 320,000 and 345,000 tonnes. SEPL faces a reduction of less than 60,000 tonnes of exports per year from the entire north east - not a 50% reduction as woodchip industries claim.27
Boral is unclear about the exact extent of job losses in the industry. The maximum amount of employment that could possibly be lost due to the 11% cut in SEPL's woodchip export licence, is forty-three jobs. In the media, Boral and State Forests have been highlighting this 11% woodchip export cut. This has the effect of creating antagonism towards conservation interests in small communities in north east NSW as people believe that losses may be greater than they could be. In Bulahdelah State Forest Boral claimed that thirty to one hundred and fifty direct and indirect jobs would be lost. In SEPL's own 1994 Environmental Impact Statement, it states that in the whole of north east NSW two hundred and fifty jobs exist directly and indirectly due to woodchipping. While Boral continues to reap in profits, local workers live in a situation of continued uncertainty spurred on by industry and government.28
In the South East Forests of NSW Boral closed its Eden sawmill on May 21 1996, having not renewed its Wood Supply Agreement some years before.29 The company has indicated that it intends to rationalise the number of mills it owns. Translation of quotas to bigger mills will create job losses.30 According to NEFA, it has also added to unemployment by cutting the size of work crews from four to three, meaning longer working hours and decreased worker safety. Boral is non-unionised and has scant regard for its workers. The secretary of the CMFEU, Gavin Hillier said "Boral now have access to 85% of the hardwood forests which taxpayers own and they are the worst employers as far as wages and conditions are concerned in NSW".31 Where Boral has a monopoly there is no alternative but to keep working for the company or face unemployment.
Of the thousands of injuries that occurred in Australian workplaces in 1993, one of the most disturbing was at the Boral timber mill at Cooroy in Queensland. According to the National Safety Council of Australia, an employee's left arm was cut off below the elbow by a docking saw only an hour and a half after another worker cut his thumb to the bone on the same machine.32
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