November 2016 Wood Matters Page 1

Wood Matters – November 2016

Clarkys Comment – We need more trees – what will it take?

Peter Clark CEO PF Olsen Ltd

The understanding that New Zealand needs more trees to support improving freshwater quality and to help meet our Paris Climate Change Accord commitments is now well accepted. How will this be achieved?

1. Given the past volatility in NZU prices and the outlook for surplus units in some markets, especially Europe, a higher domestic NZU price alone will not do the job. Investors will be wary of the NZ government increasing supply of domestic units to depress the price via either auctioning or allowing cheap international units into our NZ ETS. Clarity from government on its intent and cross-party support for that would provide certainty for both foresters and emitters on which to base investment decisions. One scenario might be that our domestic policy is de-coupled from our international obligations such that the government may import low-cost units but would not use these to depress the domestic carbon price.

2. Even with that clarity, the harvest liability limits the utility earning NZUs to improve investment returns. Under the current rules carbon stored in trees is treated as instantly oxidised on felling. We know that does not happen in reality. Currently the government utilises the international accounting for carbon stored in Harvested Wood Products (HWP) in reporting New Zealand’s net emissions. Devolvement of the HWP deferred liability to those investing in planting trees would de-risk the harvest liability, and also the risk of any catastrophic forest loss, very much enhancing the investment case to plant trees.

To invest in planting trees one must own, purchase or lease land. Let’s look at those that own land – farmers and Maori groups. Both have choices as to what to grow on their land.

1. Maori will be looking for a better return than past forest leasing deals have delivered, and ultimately to be in a position to invest in their own right on their own land. Joint ventures with the Crown, that sees the Crown plant trees on a shared return basis is worthy of examination. It could be structured such that any taxpayer input is temporary and generates a good return to the taxpayer. Removal of the arbitrary Kyoto split between pre-1990 and post-1989 would help the case for replanting Maori land that has been or is being returned after its first crop of trees is harvested.

2. Farmers are coming under increasing pressure in many catchments to limit stock access to streams and the adverse environmental effects of intensification of stocking and fertiliser application. Trees on parts of the farm offer a means to focus dry stock intensification on the best quality land to meet overall catchment limits. Trees also offer financial resilience through diversification. Some farmers have done very well from harvesting woodlots in recent years. What is most needed, in my view, is an education and extension service that illustrates the benefits of tree crops to farmers, both from a ROI and risk management perspective. An early signal that the agriculture sector will have to play some part in the NZ ETS and exclude stock from hill country streams would encourage tree planting on farms now, and mitigate the risk of a harder adjustment at a later date if that signal is delayed.

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There are also a number of relatively low-cost or net taxpayer positive initiatives the government could implement to boost confidence with forestry investors. These include:

1. Support for use of engineered timber in commercial and multi-storey buildings. A strong domestic wood processing sector that in turn relies on a vibrant domestic construction market matters for confidence in tree planting.

2. Support for careers information and trades training for the forestry and wood processing sectors. In the short-term we are also likely to need improved access to migrant labour for planting trees.

3. Investment in regional roading to safely access existing forests.

4. Changes to the Cost of Bush tax treatment to improve the liquidity of immature forests.

5. A national LiDAR dataset that would be of value to all rural land planners.

6. A focus on Non-tariff Trade Barriers in key overseas markets that limit access or returns from the export of processed timber products.

Log Market - November

Peter Weblin Chief Marketing Officer PF Olsen Ltd

Introduction

It would probably be remiss not to mention the ascendency of Donald Trump to the coveted position of president-elect of the USA, but since every journalist, news anchor, talk show host, blogger and panelist is covering this ad nauseam, Wood Matters will spare readers more coverage. An immediate outcome (apart from mild nausea that such a thing could come about in the 21st century) is rallying USA and Asian share markets and a weaker NZ$. Both, on face value, are supportive of the log market. On a more sombre note, Wood Matters and PF Olsen would like to acknowledge those affected by the recent devastating earthquakes centered around Hanmer but affecting a much wider area. We wish those affected courage and resilience as they work through putting their lives back together. Some of those affected include our clients and contractors, especially those working around the Marlborough and Wellington regions. Our local managers will try their best to minimise disruption and keep affected people informed. In November pruned export logs lifted $5/JAS m³ although we are told demand is still not that strong for this product. Some purchasers in China have told us that they only take pruned logs to ensure a supply of unpruned logs (see China Trip Report on page 5). Unpruned export logs lifted $4/JAS m³ for China logs but remained steady for India supply. The domestic market is “in-quarter” (4) and consequently has seen little movement in price. Demand remains strong.

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Export Log Market

China

After bottoming out in the middle of last year, the housing market in China is in a strong upward trend with 62 out of 70 cities monitored experiencing a lift in price in the past 12 months. Tier one cities are experiencing very strong house price increases (30% in Beijing). For more information, see the China Trip Report on page 5. A recent report on log stocks at China ports reducing from 2.4m m³ in early October to 2.1m in early November. This 12% reduction is significant over such a short period and should support demand and price for NZ logs and lumber. In a recent research report into log exports to China, Scion presented an interesting chart that showed (according to FAO’s 2016 statistics) that the trade of logs between New Zealand and China is the largest roundwood flow between any two countries in the world. The chart below shows the relative size of this and the other highest roundwood flows.

Largest roundwood trade channels in the world in 2014 (source: The New Zealand – China Log Export Market: An Investigation of Supply Chain Integrity, Carel Bezuidenhout et al, Scion Research)

Whilst the high ranking of the NZ-China log trade is note-worthy, another important point to note is the high volumes of logs from the Solomon Islands, Papua New Guinea, Myanmar and Malaysia. [It is likely that the actual trade flows are even higher among these parties than reported due to widespread official banning of purchasing illegally harvested logs.] The point is, however, much of this harvesting is not sustainable and these South Sea hardwood logs are going to get increasingly hard for China and India to get hold of. This will continue to support the current strong trend of substitution to alternative timbers – Radiata pine from New Zealand performs particularly well in this substitution role and this will be supportive of demand and price in the future.

India In an unprecedented move the Indian government has demonetised the two highest value currency notes of Rupees (the Five Hundred and the One Thousand Rupee notes). The move was to further the Indian government’s policy to erase “black money” and counterfeiting. The notes are being replaced by new high-security notes of Five Hundred and Two Thousand Rupee denominations.

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A demonetisation amnesty window is available till 30th December 2016. Within three days of it being introduced approximately NZ$6 billion of the demonetised currency has been deposited in the banks. The enormous influx of cash is expected to decrease the cost of funds by 0.03 to 0.10 percentage points within the short to medium-term. In the short-term, the demonetisation is expected to affect small firms and rural demand which is driven by the cash economy. Real estate has been affected as “black money” is used extensively especially in secondary sales and in tier two and three cities, and below. Business has come to a slow down with 200,000 ATM’s and banks being stretched; most people spend their time in queues exchanging their notes. The banking sector has been stretched beyond imagination with a magnitude unseen in global history. This will result in slowing down of banking procedures for Letters of Credit and documentation as all bank staff are being utilised for the purpose of collecting and disbursing cash. This will flow into more difficult credit for log purchasers in the short-term. Longer-term this bold move by the government is expected to be positive for New Zealand Radiata pine in India. Less “black money” will make the importation of illegally logged South Sea hardwoods more difficult and increase the rate of substitution to other log sources, including NZ Radiata pine. The lower cost of funds (borrowing) is also expected to be stimulatory for the economy and the housing market. In the meantime, the India market is softer with various stories of stranded vessels (no LCs) and even of one vessel being diverted to China at late notice. Until the volatility of the demonetising bank notes blows over, the log market is likely to also be volatile and forest owners should be cautious. India’s economy is expected to expand by 7.6% both this year and 2017 according to the International Monetary Fund. This is a full 1.0% higher than the rate of 6.6% forecast for China for 2016.

PF Olsen Log Price Index to November 2016

The PF Olsen log price index is up $2 in November to $120. The index is now $33 higher than its 6-year low of $87 in July 2014 and $12 above the two-year average and $15 above the five-year average.

Basis of Index: This Index is based on prices in the table below weighted in proportions that represent a broad average of log grades produced from a typical pruned forest with an approximate mix of

40% domestic and 60% export supply.

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Indicative Average Current Log Prices – November 2016

Note: Actual prices will vary according to regional supply/demand balances, varying cost structures and grade variation. These prices should be used as a guide only and specific advice sought for

individual forests.

Special Log Market Report – China Trip 11-21 October 2016

Peter Weblin Chief Marketing Officer PF Olsen Ltd

A lot happens in China in 12 months, the period of time since your Wood Matters editor was last in China. We know that the GDP growth rate has slowed to under 7%, the share market has dramatically come off its highs and the housing market has recovered strongly. A recent report had Beijing's house prices up 30% in the past 12 months!

As we travelled through China we observed the usual massive investment in infrastructure (airports, high-speed trains, motorways) and the frequent clusters of cranes towering above hollow concrete apartments in various stages of completion.

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Apartments-in-construction still tower over much of the skyline of the larger Chinese cities.

Sentiment from the business we visited was mixed. In general, the government-owned businesses were more upbeat. Massive investment in port capacity and more wood processing was evident in both the private and government sectors. This augers well for lower port costs (increased competition) - we were told that one newly opened port was offering free wharfage to attract log customers. It also augers well for demand for NZ Radiata pine from sawmillers and other wood processors. This demand, however, will only be sustainable if backed by sufficient increases in demand for wood products from end-use consumers (either domestically or for export).

There is still massive investment going into wood processing in China. This vast integrated wood processing site had a modern continuous kiln and a modern, high-speed sawmill. At completion, the

site will have 18 mega-warehouses totalling a floor area of 48 hectares.

The main concern we had with hearing of capacity expansion plans was their unbelievable scale. If all of the expansion plans we heard about came to fruition, we got the impression that the wood market in China would have to double in the next few years to keep up. The proponents of these projects

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seemed to pay no heed to possible over-capacity issues, let alone a possible drop in demand from say, the bursting of the property bubble. Unbridled optimism seems to drive much investment and we believe it is based on an uninterrupted continuation of the current mass urbanisation of rural Chinese. A government official told us that the government’s five year plan has 260 million people moving from the countryside to cities – that’s a lot of apartment construction, fit-out and furnishing. Whilst the Chinese real estate market has picked up (and in some cities is soaring - i.e. Beijing) the sentiment amongst those exposed to the construction materials (lumber and plywood) market was subdued. We were told that many Chinese log buyers were currently losing money, especially those dealing with construction lumber. Those taking large volumes of pruned were also facing financial difficulty even with the lower pruned log prices. Three other new themes emerged on this trip, the first two were pleasing although with the inevitable feeling of "finally". The first was increased references to environmental matters. One large, integrated wood products factory we visited had changed from burning coal for its wood drying kilns to burning wood-waste to reduce smoke and carbon emissions. (Later it was admitted that this change was a directive from government.) The second was an increased emphasis on health and safety. At one lunch we attended, senior managers from a government-owned port company were debating the risks of workers having long shifts with few breaks. In general there seemed to be more attention being paid to things like personal protection and equipment (PPE) and safer working practices. This is a welcome development. The third theme, and a less positive one, was financial stress and issues with debt. It became clear to us that whilst Chinese households may have enviable savings habits, there is plenty of debt floating around Chinese wood products businesses. We were told of instances of banks making early calls on principal on large loans. We were told of sawmillers seeking financial assistance from government-owned businesses in exchange for preferred supplier status. It was hard to know what the drivers were here, but it is likely that the banks (all of which are government-owned) are having increased state scrutiny on their loan books. It could also be that they are being made to reduce loan exposure generally. This tightening of credit, along with escalating wage and compliance costs could jeopardise the financial viability of some Chinese forest products businesses. An additional headwind is increased logistics costs. In a bid to make trucking safer, from 21 September of this year, the government is clamping down on over-loaded trucks. We were told, for example, this will increase the cost of transporting logs from Lanshan to Linyi from 30 RMB to 60 RMB per m3. For short haul (around 5km) we were told truck drivers may risk it by posting "spotters" at intersections and txt drivers if police are seen. However, if you are caught, we were told you can expect your truck to be impounded and cut in half! [not too sure how that would work]. There are clearly some bright spots in the market. Two popular products we observed were UVP flooring on particle board/OSB (orientated strand board), and painted lineal mouldings destined for the housing construction and DIY market in the USA.

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Luli Group in Shandong is making OSB from a Dieffenbacher continuous press, demonstrating that Chinese wood processing is mechanising and implementing technological innovation.

A major use of OSB is as a substrate for flooring. A very realistic image of wood grain is commonly embossed on the OSB using a hard vinyl material which is both visually attractive and hard wearing.

You can see this product in use in shops, restaurants and hotels all over China.

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Painted finger-jointed mouldings are having the first of 3-4 coats of paint applied prior to being packaged up for the USA housing construction/remodelling market.

We noted that the erstwhile market darling edge glued panels (EGP) seemed less in favour due to a big increase in Chinese supply from recent massive investment in manufacturing capacity. However, the strong USA and Chinese housing markets seem to be more or less keeping pace but margins are probably being trimmed. We observed Radiata pine lumber being imported from Chile and were told this is increasing. This, along with Russian and European lumber is a supply source threatening NZ Radiata pine’s market position. One highlight of the trip was a return visit to the Linyi Development Planning City Morning Ecological Demonstration Garden of Agricultural Science and Technology and Conceptual Planning (whew! – Chinese like big names) - we call it the “Holiday Park” for short. This 20 hectare development was only a few months into construction when we visited it in October 2015 but was fully completed and operating when we visited again in October 2016. The following are some “before” and “after” photos which demonstrate just how quickly work is completed in China. In this instance it’s pleasing that there is a strong environmental theme to the development – and a lot of wood use!

It’s welcome to see a wooden church being constructed in China and in this case, very rapidly. Only 12 months passed between these two photographs. We were told a wedding had already been held

in the church.

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Consistent with the ecological theme of the park was a lake, stocked with fish and careful landscaping. People were observed catching fish as we walked around.

Summary

Continued urbanisation and strong economic growth has the potential to drive significant increased demand for wood products for the next 20-30 years in China - far more than the increased supply from countries such as New Zealand. Whilst there are viable substitutes, New Zealand Radiata pine is well-positioned to satisfy this demand and is more likely to gain market share than lose it. It has the unique advantage of being very good (but not great) for a wide range of end-use applications. Sometimes described as the world’s best second-best timber, Radiata pine’s versatility serves it very well in the Chinese market as we witness a transition from it being used primarily for construction support to being used in a wide range of apartment fit-out, wood remanufacturing applications and furniture end-uses. Fortunately these latter two wood use segments open up more export opportunities and reduce reliance on domestic Chinese demand. What could derail the above trend is either a property market crash or “hard [economic] landing” in China and/or some other event that triggers a large and sudden readjustment in the leveraging (borrowing) and the financial markets. It could also be triggered by social unrest and now an increased likelihood of a [Trump induced] trade war with the USA. A major slow down in the economic growth rate in China (for whatever reason) would likely precipitate many of the above in any case. During the past six years, the PF Olsen log price index has increased by about 1.5% real (over and above the rate of inflation). That rate of increase is actually quite considerable as it adds about $10/m3 to the current average log price in 5 years which adds 22% to a net return (or stumpage) of $45/m3. This, of course is on top of the approximate 40% increase in net return (or stumpage) expected from a mature forest from growth of the forest during the same period (excluding the time value of money). Balancing these complex views of the future are what owners of mature and near-mature forests need to deliberate over in regards to how and when to sell their forest. Fortunately there is more information available than can be shared in this short article, and there are clever ways of analysing the actual economic growth potential of each individual forest. Should you wish to learn more about options related to your mature forest, email Peter on peter.weblin@pfolsen.com

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Forestry and the Emissions Trading Scheme

Mike Duckett Forestry Consultant PF Olsen Ltd

International News

Results of the recent elections have created some uncertainty around United States involvement in the Paris Accord. While some reports are suggesting Barack Obama will try to sign the accord before he leaves office, other reports talk of Donald Trump considering ways to bypass a theoretical four-year procedure for leaving the accord. It has to be noted that Trump seems already to be softening his stance on some of his key election promises (the “wall” is now likely to be a “fence” in places…). He may soften his position on Paris too. Only time will tell. Despite this future uncertainty, Canadian Prime Minister Justin Trudeau says it’s full steam ahead for his government’s environmental plan, including a national carbon price. Trudeau announced last month that he would impose a national floor price on carbon dioxide in 2018, rising to $50 per tonne by 2022.

Domestic News

Earthquake Disruptions

The recent earthquake has caused disruption to many government departments, including the Ministry for Primary Industries, and the Environmental Protection Authority (EPA). Some offices are still evacuated while awaiting inspection, so we are expecting delays in processing applications and answering queries in the short-term at least.

Climate Cheats 3 – Cook the Books

The Morgan Foundation has this month released its third “Climate Cheats” report, again accusing the government of cheating in its commitments to climate change. The Morgan Foundation contends that the timing of a proposed rule change to allow “averaging” of carbon stocks could enable New Zealand to generate between 65 and 90 million excess credits. The excess emissions this allows equates to nearly one full year of New Zealand’s gross emissions. The foundation believes that “this approach will violate not only the forest accounting rules agreed under the Kyoto Protocol, but also the Paris Agreement's key principle of progression." The full report can be downloaded from the Morgan Foundation.

Price Update

NZUs are currently trading at around $18.30 per NZU, a slight reduction from last month. The figure below shows the recent carbon credit prices for EUAs, CERs, NZUs and ERUs. Note that from 1st June 2015 only NZUs or New Zealand AAUs are valid units in the NZ ETS. EUAs are valid units for trading within the European Union.

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Figure 1: Recent Carbon Prices - NZ$/t CO2e – Real (CPI adjusted)

PF Olsen launches Payment Protection Getting paid for the forest produce you sell is obviously a critically important component of a successful forest harvesting and marketing project. However, the risks are often poorly understood by forest owners. Sometimes this drives forest owners to opt for an outright (advanced) lump sum sale of their forest or woodlot to minimise payment risk, even if that means compromising its total value. Despite rigorous processes to check the credit risk of log purchasers and monitor credit exposure, there is always risk of payment default. Whilst defaults on payment for logs don’t happen all the time there have been some big ones in the last few years. Examples are Ahead Lumber, Bay Lumber, Clyde Lumber, Rennals, Southern Cross, Tachikawa, Thames Timber and most recently Waitane. In addition there are instances of log exporters failing to pay. When defaults occur they can be devastating for forest owners. Over the past few years the log market has become more volatile. This volatility is expected to continue and will put pressure on log purchasers’ financial viability and increase default rates. One industry observer is predicting that there will be 15 fewer sawmills operating in New Zealand, within the next 6 years, as the trend of industry rationalisation continues. And that’s just the domestic market. The risks can be even greater in the sale of export logs where some of the purchasers offering higher prices have a short track record and little trading history. Some forest owners get comfort from harvesting managers saying they will “guarantee” payments. However, this can simply transfer the risk from one risky entity to another. Most managers structure their trading business to have few assets (asset protection) and couldn't withstand the financial shock of a significant payment default, so the guarantee becomes worthless. PF Olsen now offers Payment Protection to protect forest owners from the risk of not being paid for the sale of their forest produce. This protection is underwritten by Atradius (a global, financially secure insurance underwriter) and administered by National Credit Insurance. The main benefits for PF Olsen Payment Protection are:

The programme is underwritten by Atradius NV, the second largest trade credit insurance group in the world with A3 and A (Excellent) credit ratings by Moody’s and AM Best respectively.

Very good coverage of log purchasers from large ones to small.

Very low premiums.

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Higher log prices.

Proven pay-out record (see Waitane Mill story below).

PF Olsen Payment Protection has been favourably received by the market and over 90% of PF Olsen harvesting and marketing client’s now have peace-of-mind knowing their precious logs sales revenue is secured. If you would like to learn more about PF Olsen Payment Protection, please contact Peter Weblin at peter.weblin@pfolsen.com or DDI: 07 921 7276.

Successful recovery of Waitane Mill bad debt proves PF Olsen Payment Protection With limited options for pruned log sales for Napier clients, PF Olsen applied for trade credit insurance for Waitane Mill Ltd in late June of 2016. This was approved promptly by the insurance broker National Credit Insurance via its very efficient on-line application process. Getting log sales access to this mill with the peace of mind of our trade credit insurance cover proved the great benefit of PF Olsen’s latest enhanced service offering – PF Olsen Payment Protection. “We had recently commenced export log sales to an Indian log purchaser at the Port of Napier”, explains Peter Weblin, Chief Marketing Officer for PF Olsen. “The unpruned prices were $3-$5/JAS better than other export prices available, but the Indian market struggles to take pruned logs. On reviewing domestic options, Waitane was offering a good price for quality pruned logs. This resulted in a net return to the forest owner $20/tonne better than the only other domestic pruned log sales option available. “The combination of the pruned logs going to Waitane and the unpruned logs going to an Indian log purchaser increased net stumpage by 25%”, explains Weblin. “However, this would not have been a comfortable position without PF Olsen Payment Protection.” Regrettably, in late August 2016, Waitane Mill went into liquidation along with its major shareholder Verda. PF Olsen immediately initiated a process to minimise the loss and make an insurance claim. In early November a successful net insurance claim of $25,949.47 was paid out to the forest owner.

Forest owner Landcorp was a beneficiary of the above example. Gordon Williams, National Forestry Manager for Landcorp, recalls that he needed some persuading in regards to payment protection when it was first introduced to him. This is what Gordon has to say now: "We were relieved to have the PF Olsen Payment Protection in place. The claims process was tidy and timely - we are really happy." Gordon goes on to say, "On two prior occasions I have been asked to approve sales of logs to purchasers considered higher risk. This is not an easy situation as I don't know the details and I put my reputation on the line. With PF Olsen Payment Protection this decision is made with more information and by financial experts." Gordon Williams, National Forestry Manager, Landcorp

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Summary of Phytophthora pluvialis population findings in New Zealand

Russell Dale CEO Future Forests Research Ltd

If you have noticed Pinus radiata trees recently with orange/brown needles it is likely to be red needle cast which is caused by Phytophthora pluvialis which was first reported in New Zealand in 2008. The symptoms on infected needles include distinct olive coloured bands with dark resinous spots. Eventually the needles in the lower part of the crown, and in some cases the entire crown, turn red and the needles fall off. Phytophthora pluvialis has also been reported in Oregon State USA, where it was first isolated in 2002. Phytophthora pluvialis was officially described as new species in 2013 in Oregon.

With funding support from the forest grower’s levy, MBIE and Scion, a large research programme has been running since 2013 to better understand the disease, its impact and options for control. To better understand the genetic diversity and population structure of P. pluvialis, genetic markers were used to compare the New Zealand and USA populations of this pathogen. The findings showed that the USA population has twice the genetic diversity of the New Zealand population.

The data indicated that this pathogen was introduced into New Zealand from the USA, which is why the genetic diversity is higher in the USA as the pathogen has been present there for a longer period of time. Interestingly, the data also showed that there were two distinct groups of P. pluvialis in New

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Zealand that may have come from two separate introductions from the USA. The outcomes of this study are that we now have a set of molecular markers that can monitor the current population and new incursions of P. pluvialis in New Zealand. Since the population has a relatively narrow diversity, determining the susceptibility or resistance of Pinus radiata to red needle cast can be done using a small number of P. pluvialis isolates. As the early analyses of the genomes of Oregon and NZ P. pluvialis isolates provide strong indications that the New Zealand population is genetically narrow, we should remain vigilant in avoiding the introduction of new isolates of the pathogen into our forests from overseas. The population analysis of P. pluvialis is being carried out by Simren Brar, PhD candidate, Massey University & Scion. Analysis of P. pluvialis genomic and gene expression studies is ongoing and is led by Dr Rebecca McDougal, Molecular Forest Pathologist at Scion.

Typical red needle cast symptoms on Radiata pine

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Safety Champion Peter Olney - Looking out for those who work in the Forest A safe and successful workplace is created by those who are invested in it, which involves having the correct mind-set, values, and beliefs. One of the basic tenants of workplace safety is “Don’t turn a blind eye” – in other words never ignore even the minor things that have the potential to cause harm or damage. Peter Olney is a logging truck driver for Williams & Wilshier in Rotorua. Mark Lawrence of Forest Distribution Ltd says “Peter lives by this tenant – if he notices something that is not right he reports it. Peter is very pro-active.” “The fact of the matter” says Peter, “…there are those who ignore unsafe acts and conditions without flinching, others who recognise the risk yet do nothing, and then there is a group, who act. I don’t like to hear people say … ’yeah I saw that the other day’ …but then nothing got said.” Peter became a union delegate in the engineers union at 16, and was its Health and Safety officer. He also served in the ambulance service for 12 years, first as an officer then as a superintendent. Peter says, “Seeing the results of things going wrong, and how easily early action would have changed the outcome, changed my thinking. I quickly learnt that ignoring a small problem can make it worse, and sometimes all you need to do is something small, a double check …just in case.” Peter’s training has helped him to understand the ‘flow-on-effect’ of a situation and the opportunity – the pathway to improvement. He also has high praise for Williams & Wilshier for their proactive approach and that they are open to ideas, and for Forest Distribution Ltd who investigate and give feedback on reports. Another clue to why Peter is a Safety Champion is his ownership. Peter says, "some drivers pick up their load then they are gone. I talk to the loader operator and think about the crew. If I see a crewmember walking towards the loading operation then I immediately let the loader operator know and we stop.” “The forest is a big work place and those who work in it are a team. We all communicate and are responsible for our own and the safety of others.” Peter is well aware that the job he does, “…has the potential to kill and if you drop your guard you could be slapped around the ears with an injury. You have to keep on thinking.” Peter also talks of the concern that all drivers feel when there is news of a trucking incident – straight away he thinks of the driver. “If the driver has been hurt then you pray for a minor (less serious injury). The news always brings it home that there are risks in forestry. We always go out hoping for a good day but in the back of our minds we are asking ‘what if’.” Safety Champions like Peter are always looking ahead, making improvements and thinking of others. They show care for the welfare of others. Such care is shown in the priority he places on putting in a report, his attitude and regard for the people he works with both in and outside of his business. Peter is also concerned by complacency! He says, “Sometimes drivers are forgetting the basics, for example they chatter on the radio. They also forget about calling their position at every road marker and remembering that not everyone in the forest has a RT in their vehicle so that drivers need to drive to the conditions.”

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Peter concludes with this advice: “… The landscape of our forests has changed. For example some of the forest land has converted to farming. Now we see a number of different users on the forest roads. Our loaded logging trucks may be sharing the road with farmers, school buses filled with children and service providers who have little experience of metal roads let alone meeting up with me. I just want people to think about the risk to them and others and not ignore the little things.”

For want of a nail, the shoe was lost;

For want of a shoe, the horse was lost;

For want of a horse, the rider was lost;

For want of a rider, the message was lost;

For want of the message, the battle was lost;

For want of a battle, the kingdom was lost,

And all for the want of a horseshoe nail.

Registration of Interest - Harvesting Package - Wellington PF Olsen is requesting expressions of interest from suitably qualified and experienced harvesting contractors. Cable Yarding contractors with a tower of 70ft and higher, with mechanised processing would be most suited to this package of work. Forests are located within 50km of Centerport Wellington with a well-established all weather roading network. Location: Upper Hutt, Wellington Volume: 200,000 tons @ 40,000 per year Duration: 5 years of work planned Contract Duration: Negotiable Contracting entities wishing to participate in this ROI process should register their interest by contacting richard.cook@pfolsen.com before 25 November 2016.

Registration of Interest - Harvesting Package - Taranaki PF Olsen on behalf of our client, CFPC (New Zealand) Co Ltd, is requesting expressions of interest from suitably qualified and experienced harvesting contractors. Cable Yarding contractors with swing yarder, grapple and mechanised processing capacity would be most suited to this package of work. Forests are located within 80km of Port Taranaki with a well-established all-weather road network. Location: Taranaki Volume: 200,000 tonnes @ 40,000 minimum per year Duration: 5 years of work planned Contract Duration: Negotiable Contracting entities wishing to participate in this ROI process should register their interest by contacting richard.cook@pfolsen.com before 25 November 2016.

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288Ha Brunswick Forest for sale Brunswick Forest is located in the southern North Island region some 15km north of Whanganui. Freehold land area totals 288 hectares with a productive forest area of approximately 198 hectares. This is a second rotation forest which has been planted between 2001 and 2005 with only smaller areas pruned and stocking estimated to be around 500sph. There is an adjoining forest also on the market which could give the new owner additional scale should they require. This tender closes on Wednesday 7 December at 4.00pm. Further information on the property contact Warwick Searle 021 362 778.