Forestry SA’s new chief executive, Adrian Hatch, joined ABC Mornings to discuss the role and future of Forestry SA and the timber industry in the south-east. Source: ABC
Forestry is a very important economic contributor in the South East and the industry has been through quite a bit of uncertainty over the past few years.
“I worked for the last four years with Forestry SA and prior to that I had a number of varied appointments in industry, three years in Asia with a pulp and paper company and before that with wood processing and forestry businesses in other parts of Australia,” Hatch said.
In the post-asset sales period, following the forward sale of timber estate rotations, here’s how Hatch described the role Forestry SA now plays.
“Under the terms of the sale, the forward sale that was carried out, Forestry SA is the principle contractor for OneFortyOne plantations in the Mount Gambier, green triangle area, includes some plantations in Victoria as well.
“As well as that, Forestry SA with its board is in direct control of a plantation estate of about 15,000 hectares in the Adelaide Hills, Mount Lofty ranges and the mid north. That’s an ongoing business role.”
Hatch said Forestry SA acknowledges the period of change for the business.
“We have to develop the commercial focus of the business more, going forward, because it’s a business that’s gone entirely into a funds management situation.
“With OneFortyOne, 50% of the business is owned by the Australia’s Future Fund. Obviously, they’re looking for a reasonable return … a long term and viable return on this business.”
In October 2012, ABC News reported forest harvest rights for forests in the south east had sold to a consortium, led by the Campbell Group, for $670 million.
In Australia, the Campbell Group trades under the name OneFortyOne Plantations.
“We’re the ongoing manager of the forests on ground, while OneFortyOne is responsible for setting the commercial direction, they have to do so within certain agreed parameters,” he said.
“Forestry SA workforce and management then carries out that direction.”
Hatch said that following the sell-off Forestry SA remains manager of the asset for a five year period – a condition of the sale.
In five years time, Hatch said its ongoing role would come into consideration.
“That’s permitted in the contract and agreements between the parties or OneFortyOne may wish to go in another direction.
“I think the important thing that many people in Mount Gambier would recognise though, is that at the end of the day the work has to be done – the management of the trees, growing of the trees, the nursery, tending of the trees. That won’t change.
“That’s the issue that we as foresters and managers like to focus on, as much as we can.
“There is more commercial ownership and a more commercial direction going forward and I think we’d be the first to admit that.”
