Commerce Commission launches enquiry into Carter Holt Harvey's halting of timber supply

The Commerce Commission has launched an enquiry into timber giant Carter Holt Harvey's decision to stop supplying timber to some major retailers.

It's concerned over its choice to only supply its largest customers such as its own subsidiary, Carters.

It has decided not to supply its smaller retailers such as Placemakers and Mitre 10, this decision forming the basis of the Commerce Commission's investigation. 

The Government and construction industry were also involved in emergency meetings on Monday. 

Builders are calling the situation a "nightmare," one tradie spent his entire Monday tracking down timber, and the planks Kane Hannam finally secured weren't exactly what he was after. 

"It's hard for the people we're building for as well," he says. "We give them a certain time to finish by, if we delay two weeks here, two weeks here, it just pushes the job out by months and months." 

The wider building industry is closer to tears: "Halfway through a project, yeah that's a crisis for those builders and those people," says  Building Industry Federation CEO Julien Leys. 

A crisis - that's dominated meetings held between the big players today including manufacturers, steel, key merchants, Mitre 10 and Placemakers.

They've all been blindsided by the move to cut supply of structural timber for the foreseeable future.

Last year Carter Holt Harvey closed its Whangarei mill, with plans to scale up in Kawerau.

Its biggest competition Red Stag Timber says Kawerau has struggled to make up the difference- and it's left a shortage in supply of five to 10 percent.  

"What's surprising is the wholesale immediate cutting off of customers who have been loyal customers for two or three decades in some cases," says Red Stag Timber CEO Marty Verry 

The shortage is expected to last at least six months. 

"There's just going to be a cap on what can be done over the next few months until things sort themselves out," Verry says.  

This is not great news for a government - desperately trying to scale up construction.

Prime Minister Jacinda Ardern saying ministers are "engaged" in looking into what has caused the issue. 

"They are interested in what we can do in government, our industry transformation plans to ensure we have more processing capacity." 

Until then - builders are asking their customers to think outside the wood frame.