Te Wera forest agreements secures growth for Taranaki
15 November 2018
China Forestry Group NZ (CFGNZ) is once again backing local wood processing with a ground-breaking agreement on harvesting and processing wood from Taranaki’s largest forest.
China Forestry Group NZ and Taranakipine sawmill in New Plymouth have signed a supply agreement today that supports long term wood processing in New Plymouth and employment for the 170 workers at Taranakipine. It’s another initiative that demonstrates China Forestry Group NZ’s ongoing commitment to New Zealand.
Forestry Minister Shane Jones – who strongly supports the private forestry sector collaborating for the benefit of New Zealand – was also in attendance.
“This is exactly the sort of cooperation we need to see between our overseas-owned forestry companies and New Zealand sawmills,” Shane Jones says. “I’m pleased that China Forestry Group NZ and Taranakipine have been able to reach this agreement and I commend both parties for their commitment to our forestry sector – for regional development and employment benefits.”
The agreement will see China Forestry Group NZ supply minimum monthly volumes to Taranakipine over the long term and at agreed pricing.
Te Wera forest is very steep in parts, requiring specialist equipment and personnel. So, to help with harvesting, China Forestry Group NZ negotiated an agreement with Northland harvesting company Stokes Logging to relocate part of their crew capacity and business to Te Wera.
“The partnerships with Taranakipine and Stokes Logging are a material demonstration of China Forestry Group NZ’s ongoing commitment to New Zealand and how forestry owners and local processors can better work together,” says Steve Walker, Chief Operations Officer of China Forestry Group NZ.
China Forestry Group NZ will underwrite the cost of Stokes Logging relocating with a take-or-pay commitment to 100,000 tonnes per year for seven years, to December 2026. This commitment will see a number of families move to Taranaki with their moving costs covered by China Forestry Group NZ.
“These agreements are based on mutually beneficial commercial outcomes. At the same time, we appreciate that we have an important role to play in the New Zealand forestry industry as a supportive and understanding partner to local operators and as kaitiaki of the natural and cultural resources entrusted to us,” Steve Walker says.
As part of China Forestry Group NZ’s commitment to achieve Forest Stewardship Council (FSC) certification for all its forests, the Te Wera forest is now fully certified under the PF Olsen Group Scheme for FSC certification. This certifies that the forest management meets the principles of sustainable forest management, including management of social and environmental characteristics of value.
The FSC certification of the forest also has commercial benefits, as many consumers now insist on sustainable sourcing.
Tom Boon, CEO of Taranakipine, says securing supply from an FSC certified forest was a key concern for Taranakipine.
“This agreement with China Forestry Group NZ will secure FSC log supply. Now we can grow our markets in New Zealand, Australia, Europe and the US with wood products from sustainably managed, renewable plantation forests,” says Boon.
“Locally, it means secure employment for our 170 staff. And, of course, the new agreement re-establishes our historic commercial relationship with Te Wera forest.”
Taranakipine was specifically founded in 1982 to process the first commercial harvest from Te Wera and had a strong ongoing supply from the forest for many decades.