Central North Island Forestry Concerns

12 April 2001

PRESS STATEMENT

From
John Hawkins, President NZ Timber Industry Federation

CHH Central North Island Plays

The New Zealand Timber Industry Federation (NZTIF) is currently considering applying to the High Court for an order to overturn the recent Commerce Commission decision to grant CHH permission to acquire Norske Skog.

John Hawkins, President of the NZTIF said, “In our opinion the Commission failed to consult adequately with or give proper opportunity for consultation to almost all of the independently owned sawmills drawing wood from that region and supplying chips.

“Natural justice was denied to key parties.

We are also vigorously opposing the CHH application to the Commission for permission to purchase the C.N.I.F.P. assets currently in receivership.

“In our opinion this is a blatant attempt to gain dominance and pursue anti-competitive behaviour in a wood volume sensitive region.

“Our concerns particularly relate to attempts to dominate high quality log grades and the likely resulting market share of structural grade sawlogs.

“CHH has consistently published a strategy of buying up third party wood lots as a vehicle for raising prices.

“Tactics to pervert the benefits of free and open competition (in the short/medium term at least) severely damage the commercial interests of otherwise efficient timber processing companies.

“To approve such an application would be a travesty of justice.

“Industry investors and the New Zealand economy have endured more than their share of misfortune from failed grand strategies amongst publicly owned forestry companies.

“The receivership of the largest pine forest in the Southern Hemisphere is tragic evidence of power plays which go wrong.

“What the industry and its customers need is more competition, not less.

ENDS

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