New Zealand's plantation forestry estate will shrink this year for the first time since planting began, the Forest Owners Association says.
This is because the forest land harvested and turned to other uses or not replanted will exceed new plantings.
"New planting has suffered the consequences of an unfavourable forestry economy and adverse government policies," president Peter Berg told the association's annual meeting in Auckland yesterday.
New plantings last year were 10,600 hectares, down from an average 44,000 hectares a year in the past 30 years and 69,000 hectares a year between 1992 and 1998.
Mr Berg said forestry exports rose by 4.3 per cent in the year to March 31, 2005, to $3.3 billion.
However, all of the increase was in processed wood products.
Exports of logs and poles fell from a peak of 8.4 million cubic metres in 2003 to 5.1 million in the past 12 months, though they still amounted to 26 per cent of the harvest.
The total estimated harvest in the year to March 31 was 19.3 million cubic metres, down from a peak of 23.2 million in the year to June, 2003.
Log export receipts per cubic metre harvested were now 25 per cent lower than in the most recent cyclical peak, in 2002.
"While this statistic is relatively meaningless because it ignores the impact of product mix, it does demonstrate that unless we get out of the commodity stream, fluctuations of this type will beset our industry," Mr Berg said.
Still, he said the outlook for forestry exports was encouraging because freight rates were down and the New Zealand dollar was expected to fall further as heat went out of parts of the economy.
"Longer term, it will require further investment of the type envisaged in the wood processing strategy to ensure that returns to growers and product utilisation is maximised."The Dominion Post
