19 Mar 2014

China FTA needs fixing - forestry body

2:20 pm on 19 March 2014

Forest and wood processing representatives have heard that New Zealand's free trade agreement (FTA) with China isn't working for them and needs to be fixed.

The logging industry says the FTA with China isn't working.

The logging industry says the FTA with China isn't working. Photo: PHOTO NZ

Chair of the New Zealand Wood Council Bill McCallum told the biennial Forest-Wood conference in Wellington on Wednesday that the Government needs to step up in a number of areas if the sector is to reach its export earnings target of $12 billion by 2022.

He says one of those problem areas is market access.

Mr McCallum says to reach the target about half of the logs currently exported will need to be processed here into products which can be sold competitively into overseas markets.

But he say the FTA with China, by far New Zealand's biggest log market, is a barrier to that.

"New Zealand logs are exported to countries with import policies that clearly favour log imports and favour their own domestic processing industries.

The free trade agreement we have in place with China is not delivering what it should be for the wood products industry and the China FTA, which favours logs over processed products is fundamentally flawed, and this needs to be corrected."

Mr McCallum says the Government also needs to do more to encourage the use of wood in commercial building construction.

He said the government should adopt a procurement policy that evaluated the whole of life benefits of wood and encourages the use of wood in commercial buildings

Another area in the Wood Council's sights is building standards.

Mr McCallum said building standards and codes need to be reviewed and rationalised he says there are over 600 standards in New Zealand today each of which are over 7 years old and most of which are obsolete.

He says a complicated and duplicative system of building standards is acting as an impediment to the use of timber products, particularly high value engineered timber, suitable for pre-fabrication systems.

Political parties set out forest policy stalls

Opposition parties have picked up on some of those concerns.

During a political forum at the conference Labour leader David Cunliffe announced a range of policies to encourage more wood processing here instead of raw log exports.

They include a pro-wood procurement policy for government-funded buildings up to four storeys high and suspensory loans to boost new forest planting.

Labour would also introduce a targeted tax incentive for local wood processors and invest heavily in road networks to improve forestry access.

The Green Party says it would put up a $1 million prize for the first 10 storey or higher New Zealand building constructed with structural or laminated timber.

Greens leader Russel Norman told the conference the award would be designed to encourage the wider use of timber in the building industry .

He says structural timber is a relatively new construction technique for tall buildings and much of the technology has been developed in New Zealand.

It offers an alternative to the concrete and steel currently used for the load-bearing elements in high-rise buildings.

For its part the Government's associate Primary Industries Minister Jo Goodhew pointed out the Government has invested $150 million in forestry innovation and science since 2010.

She says forestry will play a big part in reaching the Government's goal of doubling primary export returns by 2025.