Industry to build grower support for commodity levy

4 Jun 2004

The forestry industry intends to work to build forest growers' support for the introduction of a compulsory commodity levy to promote the development of the industry.

For a copy of the Jaakko Poyry report, refer to the Technical section under File Libraries.

Forest industry organisations —New Zealand Forest Industries Council (NZFIC), the New Zealand Forest Owners Association (NZFOA) and the New Zealand Farm Forestry Association (NZFFA) today released a study by international forestry experts, Jaakko Poyry. The study was commissioned last December to gauge the attitudes and opinions of major stakeholders around the possible introduction of a levy under the Commodity Levies Act.

NZFOA President Peter Berg said that finding a means of equitable and secure funding for industry good activities remained vital for the industry’s future.

"Jaakko Poyry's conclusions were drawn from comprehensive interviews with a wide cross-section of industry representatives including most of the leading forest growers and processors as well as a range of smaller growers," said Mr Berg.

"While the report concluded that there is already a substantial body of grower support for a commodity levy, some significant concerns arose that will need to be addressed if a future industry-wide referendum seeking approval for a levy is to be successful. We will take the time over the coming months to address these concerns."

Mr Berg reiterated that no levy would be implemented without the clear support of potential levy payers. "We are committed to the utmost transparency with this process and hence our decision to release the Jaakko Poyry report today."

New Zealand Farm Forestry Association President Nick Seymour said that farm foresters views had been actively sought during the consultation process.

"Farm foresters are familiar with levies in the agricultural sectors and will want to ensure that any levy will produce net benefits for the payers. We need to do more work to clearly demonstrate the links between proposed levy spending and returns to the forest growers paying these levies."

New Zealand Forest Industries Council Chairman Lees Seymour said the future of existing industry organisations had been identified as an area needing further clarification.

"New Zealand's forest estate is a significant revenue generator within the economy and with production value predicted to quadruple to $NZ20 billion by 2025, it is critical that there is a united approach within the sector," he said.

"A more unified and better funded industry structure would also enable us to leverage the new funding for market access and development coming forward under the Forest Industry Framework Agreement (FIFA) announced by the Government last week. Industry will only be able to access these new programmes if it has its own source of funding and structures able to deliver agreed outcomes."

Jaakko Poyry is an international forestry consultancy company with wide experience in this field. They completed a similar industry report for the Australian forestry sector.