Coronavirus: Forestry industry 'in crisis'

The industry group representing forestry contractors says the crisis facing the sector because of coronavirus is dire, and is getting worse.

Many of the country's logging crews are unable to work because of supply chain disruption in China.

The New Zealand Forest Industry Contractors Association (FICA) said contractors were reaching breaking point in an ever-worsening situation.

Rapid impacts had been felt over the past month by the industry with the effects of the outbreak of the coronavirus, with many out of work and in serious financial crisis, it said.

CEO Prue Younger said people outside the industry were largely unaware of the seriousness of the crisis.

"We need to have politicians, government officials and the public outside of forestry fully understand just how dire our sector of the industry is for our contractors," said Younger

"Logging and forest roading contractors who employ the bulk of the people and carry the highest debt have been hit extremely hard. The planting crews are the least affected for now, but their work will inevitably be impacted if depressed log prices continue long enough."

Younger said the contracting workforce was more vulnerable than ever before in any previous market crash.

"As a consequence of the mid-1990s planting boom, far more of the national cut is now in smaller forests. 

Smaller owners have a short window to harvest and are far more sensitive to price drops than larger corporate forests historically were."

Lay-offs were a direct result, she said with hundreds of workers already laid off and more to follow.

The crisis was also affecting the transport sector, with logging truck drivers facing lay-offs as the harvest volumes drop.

Log Transport Safety Council (LTSC) Chairman Warwick Wilshier said as well as mirroring the downturn equally with forestry contractors, there was concern about the work being carried out around deployment.

"The lack of truck drivers prior to the COVID-19 crisis was bad enough and now their drivers are seen to be an easy target for work in other industries like horticulture, freight and road

maintenance," said Wilshier.

Both groups said more needed to be done by Government and Forest Owners to preserve and retain a skilled workforce.

Minister of Economic Development Phil Twyford visited Gisborne on Wednesday and  Newshub there was help available.

"We're not looking at cash injections other than what the welfare system already provides," said Twyford.

"MSD are really active on the ground providing job seeker grants and other hardship systems to people also working with employers and employees to match people to jobs."

The Government was also expected to soon reveal a package of measures aimed at easing the economic blow.

"We've already boosted some of the regional business advisory services that are out there because some businesses are having cash flow, payroll issues," Ardern told The AM Show on Monday.

"IRD is already implementing what I would essentially say is leniency in dealing with provisional tax penalties and so on. 

"The Minister of Finance is meeting with the banks today because they are at the frontline of helping support businesses affected by COVID-19. We want to make sure they've got their hardship packages in place, and what we're doing is complementary to that."