Tate: Logging Industry “Depressed”

by PNG Business News - January 21, 2022

Photo credit: Papua New Guinea Mine Watch

According to PNG Forestry Industry Association (PNGFIA) president Bob Tate, the country's logging industry is depressed, with nothing on the horizon in the short term to instil confidence in industry players.

According to Tate, the logging business has been hurt by ongoing tax reforms as well as a drop in market demand. He claimed the sector was currently generating roughly 2.5 million cubic metres per year, down nearly 50% from just under four million cubic metres.

“The Government has taxed it (logging industry) out of existence,” Tate said.

“It’s no longer sustainable.

“In Western, Gulf and West Sepik, all factories are shut. Thousands of people have lost their jobs.

“Mills of various sizes open and close quite often depending on supply and demand and in round numbers probably 20 to 25 medium size mills are operating.”

According to Tate, the country used to have around 40 mills running.

“No long supply, no mills operating.

“The biggest sawmills relied on having big logging operations, if logging becomes unsustainable, then there is no logs to put in the factories.

“Then there is the problem of where to sell them.

“We are on the receiving end of the collapse in demand in the world market.

“The industry is looking terrible, it is depressed with nothing on the horizon in the short term to give any confidence to industry players.

“We have been over the years asked the government for a taxation regime in the forest sector that restores sustainability in the long term, the tax rules change now and then and increasing.

“The government is now getting roughly 55 to 60 per cent of the industry turnover that’s unsustainable and driving industry to collapse.”

 

Reference: Luma, Dale. The National (14 January 2022). “Logging industry ‘depressed’


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