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Australia's Forest Industries
Forest industries provide employment for many Australians, particularly in rural areas where there are often few other skilled job opportunities where rural communities rely on forest industries for survival.
Australia's forest policy aims to ensure that forests are managed to maintain and enhance our environmental, social and economic values for current and future generations.
The industry regenerates harvested areas to ensure that the forest re-grows under codes of practice to minimise environmental impact. In native forests less than 1 per cent of the production forest is harvested each year. The area of plantation harvested each year depends on the rotation length and age class distribution of each plantation estate as well as market demands.
As a natural, renewable, energy-efficient resource, timber is often environmentally preferable to aluminium, steel or plastic. The products can be re-grown and their production processes use significantly less energy than alternative products.
Choosing products from Australian forest industries is also more environmentally responsible than choosing imported forest products from countries with lower standards of forest management practices.
The Action Agenda for Forest and Wood Products 
PDF [574kb] provides a vision for Australia's forest and wood products industry and actions required to create a dynamic partnership between industry and government.
General overview of Australia's forest industry
Value of production
Forest estate
Trade
Exports
Imports
Outlook
Note: All statistical information on this page is sourced from ABARE: Australian Forest and Wood Product Statistics.
General overview of Australia's forest industry
Forest industries are Australia's second largest manufacturing industry, with an annual turnover of $19 billion. The industry contributes:
- around 1 per cent to Australia's Gross Domestic Product, and
- 7.2 per cent of manufacturing output.
Employment in the forest and wood products industry has remained at consistent levels over the past 6 years. In 2006-07 the industry directly employed 83,400 people, including 11,300 people in the forestry and logging sector, which is an 11% increase over the past decade.
Most are employed in manufacturing industries, such as veneer and paper manufacturing.
Despite consistent levels of employment, the forest sector is facing a skills shortage with an industry report identifying areas such as electricians and skills in leadership as having the greatest shortages across the sector. There is also a shortage of professional, tertiary-educated foresters in the industry. Further information is available in the report titled: Wood and Paper Products Industry Skills Shortage Audit 2006.
In 2006-07, Australian forests produced 27 million cubic metres of wood - 69 per cent from plantations and 31 per cent from native forests. More than 1000 mills processed this wood to produce:
- 5.1 million cubic metres of sawnwood
- 1.7 million cubic metres of panels, and
- 3.2 million tonnes of paper and paperboard product.
Value of production
In 2005-06 Australia's forest production was dominated by high-value products (industry value added) such as:
- paper and paper products (42.4 per cent)
- wood panels and laminates (35.3 per cent)
- sawn and dressed timber (19.1 per cent), and
- woodchips (3.2 per cent)
Forest Estate
Australia's native forests cover 149 million hectares, or 19 per cent of Australia's land area.
Only around 9.4 million hectares - 6 per cent of total forest area - is available for timber production and less than 1 per cent is harvested each year.
Plantations cover 1.9 million hectares, of which 53 per cent is softwood species and 47 per cent hardwood. Plantations account for around two-thirds of Australia’s log supply. The hardwood plantation sector is expanding rapidly, where by the year 2020, hardwood plantations are expected to supply over half of the predicted 31 million cubic metres of logs supplied from plantations. The vast majority of hardwood is being grown for pulpwood, whereas softwood plantations are generally used to supply sawlogs
Most plantations are now on private land, and private funds are now being used for 85 per cent of all new plantings.
Trade
In 2006-07, Australia’s annual trade deficit in forest products was $1.9 billion, comprising
- $2.4 billion in exports, and
- $4.3 billion in imports.
While total exports of wood products in 2006-07 were $2.4 billion, imports during the same period were $4.3 billion. Approximately $1.5 billion of this deficit is in paper products, with paper products accounting for more than half ($2.3 billion) of Australia’s imports in 2006-07. Imports of manufactured paper products, such as books and note pads, are valued at $469.5 million.
Major forest products traded include:
Product |
Exports ($m) |
Imports ($m) |
|---|---|---|
|
Paper, pulp and paper products |
949.2 |
3007.3 |
|
Roundwood |
117.4 |
0.6 |
|
Sawn timber and logs |
149.9 |
418.4 |
|
Wood panels |
123.0 |
279.1 |
|
Woodchips |
950.3 |
1.5 |
|
Misc |
62.5 |
567.9 |
|
TOTAL |
2352.3 |
4274.8 |
Exports
Total forest product export earnings have risen by 97 per cent from 1996-97 to 2006-07.
Woodchip exports, as a proportion of total forest product exports, have been gradually falling over this time period, from 43 per cent of forest export earnings in 1996-97 to 40 per cent in 2006-07, as a result of the changing composition of forest product exports.
Exports of pulp, recovered paper and coniferous sawnwood have been growing strongly. In the past two years the volume of:
- pulp exports increased by 238 per cent
- coniferous sawnwood (roughsawn and dressed) exports by 122 per cent
- recovered paper exports by 63 per cent, and
- woodchips by 11 per cent.
In 2006-07, sawnwood exports grew by 42 per cent in volume. However, exports of wood based panels declined by 22 per cent over the year, and paper and paperboard exports fell slightly.
Changing global markets have a continuing impact on the Australian forest industry. Exports to China have increased to around A$250 million in 2006–07, from just A$15 million a decade ago. Exports to New Zealand and Japan have also increased over this period.
The main forest product export from Australia is woodchips with 5 952 kilotonnes exported during 2006-07. With a value of $950 million, this represents 40 per cent of the value of our total forest product exports. Of total woodchip exports by volume, 91 per cent went to Japan. There has been a 73 per cent increase in the volume of woodchips exported in the ten years to 2006-07, while ABARE estimates that the native forest sourced woodchips has fallen from 96 per cent of total woodchips exported in 1996-97 to 57 per cent in 2006-07. In 2006- 07, exports to Japan made up 38 per cent of the value of total wood product exports. Exports to New Zealand and China accounted for 15 per cent and 11 per cent respectively.
Imports
While forest product exports have increased by 97 per cent over the last 10 years, imports have increased at a much lower rate of 57 per cent in that time. Australia’s forests now produce 96 per cent of sawnwood and wood-based panels for domestic consumption.
Imported paper and paperboard products account for about 43 per cent, by weight, of the paper and paperboard products consumed in Australia.
In 2006-07, imports of paper and paperboard totaling $2.3 million exceeded exports by $1.6 million.
Sawnwood is also a significant import at $418 million, however the volume of imports has fallen by 19 per cent in the 10 years to 2006-07. More than half of all imported sawnwood comes from New Zealand. Of total wood product imports in 2006-07, 17 per cent by value originates from New Zealand, 12 per cent from China and nine per cent from Indonesia.
Outlook
Australia is well placed to take advantage of the expanding wood and fibre markets in the Asia-Pacific region. Australia's domestic market also provides a solid investment platform for strategies to replace imports and develop export opportunities.
Four major elements make Australia an attractive investment opportunity:
- sufficient high quality, cost competitive resource
- high standards and world-competitive infrastructure, particularly in transport, communication, and energy
- highly trained workforce, and
- low sovereign risk and high political stability, particularly the approval process.
Australia has the resources to support investments in the manufacturing of:
- laminated veneer lumber
- pulp and paper
- panels, and
- sawn timber
