Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Juken NZ looks to halve Gisborne mill staff

Juken NZ looks to halve Gisborne mill staff in bid to drive profitability


By Rebecca Howard

Jan. 23 (BusinessDesk) - Juken New Zealand, a unit of Japan's WoodOne Ltd, is consulting workers at its Gisborne wood-processing mill on a plan that may see it halve the mill's workforce as it struggles to return to profitability in a highly competitive market. 

The Juken mill at Matawhero opened in 1994 and employs some 200 full-time employees. It is one of four Juken mills and processes radiata pine to make solid wood and engineered wood products such as plywood, laminated veneer lumber and SLVL (veneer), mainly for the Japanese housing market. 

Juken general manager Dave Hilliard said there’s been a significant drop in demand from Juken’s main export market in Japan for plywood and structural LVL building products in the past few years, which has seen these parts of Juken’s New Zealand processing business operating at a loss. To address that, Juken NZ wants to stop plywood and LVL production at the mill and scale back veneer manufacturing, cutting the factory's full-time workforce to about 100. 

“The Japanese housing market has been in decline and future demand for these products is not expected to improve because of the ageing population in Japan," he said. He also said the company's plywood is increasingly unable to compete in the domestic and international markets against product out of large-scale wood processing plants from the likes of China and South America. 

The latest accounts filed to the Companies Office show Juken NZ reported a profit of $31.1 million in the year ended March 31, 2017 on revenue of $220.4 million with the bottom line flattered by revaluation gains of almost $40 million and attracting a tax bill of $11.7 million. That compared to a profit of $5.4 million on revenue of $219.9 million in the 2016 financial year when revaluation gains were more muted. Gross profit was relatively flat in the 2017 year at $42.7 million, with a greater proportion of sales to related parties in the period. 

Juken NZ's Hilliard said "significant investment would be required to increase to a scale to compete internationally. At this time, there’s just not the log or manufacturing volume of appropriate quality and price to justify that investment.”

The local holding company's $343.2 million of plant and machinery was valued at $58.3 million as at March 31, 2017 after accumulated depreciation and impairment charges. 

Juken NZ's proposal to staff would see the mills return to profitability to keep high-value wood processing jobs and investment in Gisborne and Wairarapa by refocusing on value-add products where there’s strong customer demand and Juken has a competitive advantage, including its premium sawn clearwood products.

The company is also changing what it makes at its Wairarapa mill, increasing production of its ‘J-frame’ framing for the New Zealand housing and construction market and decreasing the specialist products made for the Japanese building market.  These changes won’t result in job losses for any of Juken’s 222 permanent staff in Wairarapa, Hilliard said. 

In a separate statement, First Union president Robert Reid said the move was a "bitter blow" for Gisborne workers and the community.  "JNL is the only significant wood processor left in Gisborne and its downsizing is a market failure," he said.

The First and E tu unions are meeting with members to figure out to respond and have called on the government "to immediately establish a task force of its agencies with the industry, community and union leaders to implement a wood plan for Gisborne," Reid said. 

The staff consultation period will run for two weeks. Juken will then consider feedback before making a final decision. 

Hilliard said the proposed changes would have no impact on Juken’s forestry operations. Juken has over 30,000 hectares of sustainably managed and certified plantation forests in East Coast and Wairarapa.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Maritime NZ: NZ Joins Global Initiative Keeping Ports Open And Freight Moving

New Zealand has joined an international port authorities’ global initiative for safe and efficient movement of goods and shipping during the COVID-19 crisis. World-wide, 56 port authorities have agreed how they will work together facilitating maritime ... More>>

ALSO:

National: National Backs Businesses With $10k JobStart

National will provide a $10,000 cash payment to businesses that hire additional staff as part of our commitment to keeping New Zealanders in jobs, National Party Leader Todd Muller and Finance spokesperson Paul Goldsmith have announced. Our JobStart ... More>>

ALSO:

DIY Law: Government Exempts Some Home Improvements From Costly Consents

Homeowners, builders and DIYers will soon have an easier time making basic home improvements as the Government scraps the need for consents for low-risk building work such as sleep-outs, sheds and carports – allowing the construction sector ... More>>

ALSO:

Media Awards: The New Zealand Herald Named Newspaper Of The Year, Website Of The Year At Voyager Media Awards

The New Zealand Herald has been labelled a “powerhouse news operation” as it claims the two biggest prizes – Newspaper of the Year and Website of the Year – along with many individual awards at the 2020 Voyager Media Awards Website of the ... More>>

ALSO:

ASB Bank: ASB Takes The Lead Again With New Low Home Loan Interest Rate

ASB has moved again to support its customers, cutting a number of home loan rates, including the two-year special rate to a new low of 2.69% p.a. Craig Sims, ASB executive general manager Retail Banking says the reduced rate will be welcome news for many ... More>>

ALSO:

Nathan Hoturoa Gray: The Problems With Testing And Case Statistics For Covid-19

To begin to understand disease transmission in a country requires adequate testing of your population with properly vetted, accurate tests. As the world struggles to find what 'adequate percentage' of the population is necessary, (estimates predict ... More>>

ALSO:

RNZ: Fletcher Building To Lay Off 1000 Staff In New Zealand

The construction company will cut around 10 percent of its workforce as it struggles with the fallout from Covid-19. More>>

ALSO:

Can Pay, Won't Pay: Cashflow Moves Urged

Government Ministers are asking significant private enterprises to adopt prompt payment practices in line with the state sector, as a way to improve cashflow for small businesses. More>>

ALSO:

Gordon Campbell: On Why We Should Legally Protect The Right To Work From Home

For understandable reasons, the media messaging around Level Two has been all about “freedom” and “celebration”, but this is not necessarily going to be a universal experience. When it comes to workplace relations, Level Two is just as likely to ... More>>

ALSO:



Auckland Airport: Thousands Of Kiwis Travelling For Queen’s Birthday Weekend


Confidence in domestic travel is beginning to steadily ramp up, with thousands of Kiwis travelling within New Zealand for Queen’s Birthday.
Nearly 400 flights will be operating to and from Auckland Airport over the long weekend... More>>

ALSO:

Science Media Centre: Understanding 5G Concerns – Expert Q&A


Recent attacks on cell phone towers have brought concerns over the rollout of 5G technology into sharp relief.
While scientific research has consistently shown that the technology does not adversely affect human health, public concerns about its impact have spread around the world, fueled in part by growing misinformation online. The SMC asked experts to comment... More>>

ALSO:


Trade: Record Monthly Surplus As Imports Dive

Imports in April 2020 had their biggest fall since October 2009, resulting in a monthly trade surplus of $1.3 billion, Stats NZ said today. “This is the largest monthly trade surplus on record and the annual goods trade deficit is the lowest ... More>>

ALSO:


Media Blues: Stuff Chief Executive Buys Company For $1

Stuff chief executive Sinead Boucher has purchased Stuff from its Australian owners Nine Entertainment for $1.
The chief executive was returning the company to New Zealand ownership, with the sale is expected to be completed by 31 May.
"Our plan is to transition the ownership of Stuff to give staff a direct stake in the business as shareholders," Boucher said in a statement.... More>>

ALSO:

RNZ: Bar Reopening Night 'much, Much Quieter'

Pubs and bars are reporting a sluggish first day back after the lockdown, with the fear of going out, or perhaps the joy of staying home, thought to be a reason for the low numbers. More>>

ALSO:

Stats NZ: New Zealand’s Population Passes 5 Million

New Zealand's resident population provisionally reached 5 million in March 2020, Stats NZ said today. More>>

NIWA: Seven Weeks Of Clearing The Air Provides Huge Benefits: Scientist

Seven weeks of lockdown has provided evidence of how pollution can vanish overnight with benefits for the environment and individuals, says NIWA air quality scientist Dr Ian Longley. Dr Longley has been monitoring air quality in Auckland, Wellington ... More>>

ALSO:

Government: Milestone In Cash Flow Support To SMEs

A significant package of tax reforms will be pushed through all stages in Parliament today to throw a cash flow lifeline to small businesses. More>>

ALSO: