Forest policy for sustainable commodity wood production

Abstract

This paper presents a policy framework aimed at sustainability in Australia's wood-based industry. It commences with a historical overview to illuminate how culture and environment combined to fast-track Australia's plantation establishment. This maturing estate is now generating new choices about meeting wood needs and the future for native forests. The essence of the forest problem lies in the nature of commodity production where cost reduction, essential for the firm's survival, comes at the expense of native forest ecological integrity. The framework explicitly includes Australia's plantation wood resource that, by definition, is excluded from the 'multiple use' approach to managing native forests for wood production. Three systems are identified - native forests as self-regenerating ecosystems, wood production systems to meet human material needs and rural socio-economic systems - and a dual strategy developed to enhance their persistence capacity. This strategy combines shifting commodity wood production from native forests to plantations and adding value by domestic processing. The strategy works in a complementary way across the three systems, meaning that trade-off is avoided at this level. Native forest ecosystems cease to be threatened by the intensification pressures inherent in commodity production and relatively labour-intensive wood products manufacturers enhance their competitiveness by processing agriculturally grown wood. A highly integrated regional industry can enhance the economic viability of wood growing that helps buffer agricultural land against the price-cost squeeze of commodity production. The policy framework may not be economically efficient if, after removing government subsidies and props to the older and less competitive native forest based sector, further measures are required to stimulate investment in plantation processing. Under these conditions, a specific wood industry policy can be argued on environment grounds. Trade-off is between market interventionist industry policy and general economic efficiency - fundamentally different to the native forest conservation versus industry trade-off commonly understood. Show more