The Age (business section)
December 22, 2005
VICTORIA'S peak forestry group has demanded that VicForests scrap its timber prices rises, maintaining they are between three and eight times higher than average increases of the past 17 years.
The Victorian Association of Forest Industries (VAFI) said the 2005-06 price rises exceeded the highest previous increase by between 124-224 per cent.
VAFI chief executive Patricia Caswell said that, based on the accepted pricing formula, timber prices should have fallen by 1.5 per cent.
"We are perplexed how they came to their decision," said Ms Caswell, a former trade union and conservation leader. "If I were still in the trade union movement, I would not have thought it credible."
VicForests, the new government corporation responsible for harvesting and selling Victoria's native forest timber, raised timber charges by 12.4-22.4 per cent from July 1, which included a 2.4 per cent inflation (CPI) adjustment. These charges were subsequently lowered by 1-1.85 per cent in November.
Ms Caswell said the timber charge increases should be withdrawn and affected customers reimbursed. "The situation needs to be rectified urgently," she said, as VAFI and VicForests both wanted a robust and sustainable forest industry.
"It's a politicised decision based on the unfounded notion that native forest timber is underpriced and from pressure from those who think we should not have a native forest industry. The industry must be depoliticised to go forward."
VAFI has also strongly protested to Treasurer John Brumby and Minister for Agriculture Bob Cameron.
In a hard-hitting submission, VAFI said VicForests' approach and price rises:
- Make Victorian sawlogs more expensive than equivalent species and grades in NSW and Tasmania.
- Make Victorian timber products uncompetitive in domestic and international markets for timber of like characteristics.
- Lacked openness and transparency.
Ms Caswell said the timber price rises had been compounded by similar rises for roading charges. Roading charges, introduced in the late 1980s, were normally based on CPI adjustments or not raised at all.
A VicForests spokeswoman said the VicForests board was considering VAFI's submission and would make an announcement shortly."
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