Image for Dr Amos: Dated material of little relevance

In his recent press release, Dr Amos makes the following claims:

(1) The Greens propose to stop all native forest harvesting.

(2) Stopping oldgrowth logging would cost 2084 jobs, mostly in Forestry and Timber Processing.

This note evaluates those claims. The conclusion is that the job losses quoted in Dr Amos’ press release are grossly overstated if assessed against policies that the Greens espoused at the last election, or the current state of the forest industry. 

Output from oldgrowth logging is falling rapidly as the resource is mined out. Rather than looking backwards to a past when oldgrowth logging was the mainstay of the industry, it would be more useful to look ahead. The task is to develop incentives for the industry to make the transition to a world when the oldgrowth forests are all gone. 

(1) The Greens propose to stop all native forest harvesting. 

Not true. The Greens’ forest policy at the last election is set out in the following document: ‘Tasmania’s Forests: The way Forward 2004’. That document proposes the establishment of new reserves to protect high conservation-value forests. It also proposes the establishment of Specialty Timber Zones for supply of specialty timbers. Importantly, it states (p.29) that ‘approximately 450,000 hectares of regrowth production forest on public land will be available to the timber industry’. 

(2) Stopping old growth logging would cost 2084 jobs, mostly in Forestry and Timber Processing.

Dr Amos’ claim is based on two reports published by Symetrics, a Tasmanian consultancy. The 2004 report, ‘Impact of the Policy to Cease Clearfelling of Old Growth Forests in 2010’ was prepared for the Tasmanian Forest and Timber Industries. The team led by Dr Bruce Felmingham. The second report, published in February 2010, was prepared for the Forest Industry Association of Tasmania (FIAT). On this occasion the consultancy team was led by Martin Farley, and the title of the report was ‘The Impact of Cessation and Non Replacement of Harvesting in Tasmanian Forests. Part 1 – Oldgrowth Forests’. 

In the first report, the consultants analysed the effect of stopping clearfelling in old growth coupes and replacing the lost production by variable retention methods or by harvesting from regrowth forest.  They estimated that, because of rising harvesting costs and declining log sizes, industry revenue would decline by 5%. They then used an input-output model of the Tasmanian economy to estimate the effect of this decline in revenue, estimating the effect on jobs to be a decline of 336 jobs.

In the 2010 report, the consultants analyse a different question. They now ask what would be the effect of removing 120,000 cubic metres of high quality sawlog from the market, which is their estimate of the effect of stopping old growth logging. In the more recent 2010 analysis, old growth production is simply not replaced. Now the estimated decline in industry revenue is 31%, and the same input output model is used to analyse the employment effects. The new employment effects are larger, as shown in Table 1.

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(Ed: Figures in the corrupted graph for a 31% revenue reduction, Symetrics (2010): are: Forestry (792), Timber processing (1105), All other Tasmanian industries (187), making a total of 2084)

It is important to note that both reports are based on exactly the same underlying data, which includes

(1) Forestry Tasmania production data from 1998 to 2004,

(2) A model of timber flows that describes the industry nearly 15 years ago – in 1996 (see Symetrics (2004), p.28, and Symetrics (2010), p.27),

(iii) An input-output model developed in the 1990s.

One might reasonably ask whether analysis based on this dated material has any relevance to the question at hand. 

In two important respects, it is clear that it does not.

Table 2, taken from Symetrics (2010) shows Forestry Tasmania’s planned production flows so as to meet its statutory requirement to make available an annual supply of 300,000 m3 of high quality sawlogs. 

There are two points to note.

(1) Symetrics (2010) models the effect of removing 120,000 m3 of oldgrowth high quality sawlog. But this level of production was never part of Forestry Tasmania’s plan. Rather, it was intended to scale back production from 100,000 m3 in 2006 to 70,000 m3 in 2012. In fact, that lower level of production from oldgrowth may already have been reached, in view of the lower demand for sawlogs – in 2009, actual production (in red) was well below the plan, and is likely to even lower in 2010. 

It makes little sense to calculate job losses from the irrelevant starting point represented by annual production of 120,000 m3. A good deal of the transition out of old growth logging has already taken place.

(2) As Table 2 makes clear, Forestry Tasmania forecasts that by 2029 all the old growth logs will have been harvested. In broad outline, the scenario is one where sawlog supply from oldgrowth forests is replaced by regrowth and plantations. The future is much more like the scenario envisaged by the Symetrics (2004) report, not the 2010 report. And of course job losses were much lower under the Symetrics (2004) report.

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