The NSW native timber industry paid the state government $70 million for logs last year, industry leaders told Wood Central today, contradicting North East Forest Alliance president Dailan Pugh’s claim that mills receive their timber for free.
Steve Dobbyns, chair of Forest & Wood Communities, produced the figure in response to Pugh’s right-of-reply published by Wood Central on Tuesday. At the same time, Timber NSW CEO Maree McCaskill rejected Pugh’s assertions, warning his portrayal of Forestry Corporation NSW ignores two million hectares of conservation funded on the back of harvest from just 1 per cent of the estate.
At the centre of the dispute is a statement Pugh made to the Forest Frontline campaign: “So, we give them the timber. We don’t charge anything for it.” Dobbyns called that claim “a blatant lie,” saying the Wood Supply Agreement regime Pugh described bears no resemblance to how the system was designed or operates today.
When former Premier Bob Carr transferred half the state’s multiple-use State forests into National Parks in the late 1990s, Dobbyns said, he “halved the allocation of timber to the industry overnight,” and the Carr government offered tradeable resource security to surviving high-quality log customers in the form of Wood Supply Agreements to soften the blow.
The agreements came with two conditions that the industry was required to meet in exchange for supply certainty. Log prices rose by 45 per cent under the new regime, and mills had to meet strict value-adding criteria, forcing them to invest in kilns and downstream processing or exit the sector.
Many mills closed in the transition, and regional communities were severely impacted, Dobbyns said, which is why he “would not call that getting your supply agreement for free.” Every log delivered under the WSAs since that restructure has been paid for, with last year’s $70 million payment to Forestry Corporation forming part of a continuous commercial relationship.
McCaskill challenged the financial framing of the dispute on separate grounds, pointing to the scale of Forestry Corporation’s conservation mandate. The agency manages two million hectares of public State native forests, half of which are managed purely for conservation, and draws income only from periodic, selective timber harvesting across 1 per cent of the estate designated for that purpose.
The same cost-to-taxpayer question, McCaskill argued, is never put to the 8 million hectares of National Parks elsewhere in NSW, where taxpayers fund management for equivalent environmental outcomes without any offsetting timber revenue.
The IPART findings Pugh leaned on in his right-of-reply cut both ways, according to Dobbyns. IPART’s 2024 review found the 2019-20 Black Summer bushfires and 2021-22 flooding events had a “significant impact on FCNSW’s operations,” driving a 50 per cent reduction in harvest volumes, but did not address the corporation’s contractual inability to pass those increased harvest and haul costs on to industry in real time.
Pugh’s suggestion that the supply shortfall shows “the timber is simply not there” misrepresents the contractual position, Dobbyns said, because the WSAs contain a non-compensatory force majeure clause covering bushfires, floods and other events beyond FCNSW’s control — conditions the agreements were specifically drafted to accommodate.
And McCaskill reserved her sharpest criticism for the regulatory environment, citing rule changes from the Environment Protection Authority that she said can halt Forestry Corporation operations while the corporation adjusts its practices to comply. She likened the experience to an overnight change in speed limits, with operators caught out on roads that had carried a different limit the previous day.
McCaskill said Forestry Corporation NSW is a wholly owned government corporation comparable to Sydney Water, not the foreign-owned industrial logging operation painted by environmental groups in campaigns against native forestry.
