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Forestry in Rotorua
Live, work, invest and do business where the rest of the world comes to play! Rotorua has developed a significant log export business over the years, supplying key Asian markets with radiata pine logs. The logs are then processed into a number of products within those countries. This development has introduced radiata pine to numerous countries, creating a market acceptance of radiata pine products.
FORESTRY RESEARCH "For Forest Research there are a number of advantages in being located in Rotorua. Apart from the fact that it is at the heart of New Zealand's major plantation forestry region, Rotorua is a pleasant city surrounded by excellent outdoor recreational opportunities. There are short commuting distances to work and no traffic congestion, the central business district and services are excellent, property values are affordable, and there is easy access to other centres.' QUOTE FROM: Bryce Heard, Former Chief Executive; Forest Research
The forestry sector comprises around some 4 % of New Zealand's GDP, accounts for over 12 percent of national export earnings, and directly provides around 1.3 % of national employment. Over the next two decades the importance of forestry to the New Zealand economy will increase significantly. Some commentators project that forestry will become this country's single largest industry. Research can help turn this potential into reality by identifying new opportunities and contributing to best-practice throughout the industry. New Zealand forestry is plantation-based, and the Central North Island (with Rotorua at its heart) currently produces around 56 % of the total wood harvest. Scion Research, formerly known as the New Zealand Forest Research Institute (FRI), was established in 1947 as the research unit of the New Zealand Forest Service. Forest Research justifiably holds a prime position both nationally and internationally in terms of Pinus Radiata research. Its technical innovation and research leadership underpins the development of all parts of the forestry sector. Scion Research is supported by more than 300 staff on its 120- hectare campus, with additional staff in the South Island, and Australia. Research activities at the Institute span all key events in the production and processing cycle, from tree breeding, growing and management, harvesting, processing, and product development, to market analysis. A focus on integrated, institute-wide research programmes is designed to highlight the benefits of adding value across all components of the sector. The Scion Research campus is also home to a number of specialist forestry industry research organisations, including the New Zealand Logging Industry Research Organisation (Liro Limited) and the New Zealand Pulp and Paper Research Organisation (PAPRO). Wood Processing Business Case Based on a comprehensive analysis of product and market conditions Jaakko Pöyry Consulting has identified the key opportunities believed to exist in New Zealand’s forestry and wood processing industry by the year 2010.
South 3 3 3 4 1 1 2 1 1 19 3 4 3 4 2 1 2 1 2 22 2 2 1 2 2 3 3 2 2 19 4 2 1 1 2 2 3 1 2 18 2 4 2 4 4 5 3 3 3 30 4 4 3 4 4 3 3 3 3 31 3 3 2 1 4 2 3 1 3 22 4 3 3 2 3 3 3 2 3 26 4 2 1 1 2 2 3 2 2 19 2 1 1 1 2 1 3 2 3 16 4 3 3 2 4 4 3 3 4 30 3 4 3 2 3 4 4 3 4 30 3 4 2 4 3 5 4 3 4 32 4 3 3 2 3 4 4 3 4 30 2 4 3 3 3 1 1 1 1 19 47 46 34 37 42 41 44 31 41 (Score: 1 is limited opportunity, 5 is a strong opportunity) Taking into consideration New Zealand’s available forestry resources, locations and potential markets, Jaakko Pöyry Consulting has, as part of this report, developed a number of hypothetical business cases to illustrate to potential investors the likely returns that may be achieved in certain product areas given an assumed level of investment. The table below summarises those business cases deemed to offer the most attractive investment options based upon the after tax-Internal Rate of Return (IRR).
Source: JAAKKO POYRY Consulting Dec 2004 - courtesy Investment New Zealand Forest Growing Locations The CNI is New Zealand's largest wood-producing region. The total area of planted forest is about 576 000 ha. As in the rest of New Zealand, the CNI forest estate is dominated by radiata pine, which accounts for 91% of the resource. Douglas-fir is the region's second major species, making up nearly 5% and offering a good alternative to radiata pine on high-altitude and snow-prone sites. Some eucalypt species such as Eucalyptus nitens, E. regnans and E. obliqua are well suited to the region, given good site conditions. The potential for eucalypt pulping is demonstrated by the large investment in establishing significant areas of this species on short-rotation regimes. Planted Forest in CNI 2000
Volume Projections The region's potential log harvest will range between 10 million m3/a and 11 million m3/a over the next 10years. Existing wood industries in the CNI consume over 60 % of the cut while the balance is exported as logs. Average log grades produced (2000 -2010) are projected to be pruned logs 14%, unpruned logs 61 % and pulp logs 25 % (Source: NEFD April 2001). Projected Log Volumes Available in CNI
Source: JAAKKO POYRY Consulting Dec 2004 - courtesy Investment New Zealand Log Features and Processing
Source: JAAKKO POYRY Consulting Dec 2004 - courtesy Investment New Zealand Infrastructure Water and Energy Rotorua's primary water supply comes from pristine natural freshwater springs. The supply is both plentiful and stable. Rotorua's municipal wastewater disposal system includes a state-of- the-art treatment plant that is based on sustainable environmental management principles. Solid waste disposal is currently just NZ$11 per tonne at Rotorua's recently modernised and expanded landfill facility, and costs are likely to remain low in the foreseeable future. The region's numerous rivers and lakes supply abundant, generally high-quality water for all forestry activities. However, siting of any processing plants, particularly timber treatment facilities, must take into consideration the Resource Management Act 1991. Electricity in the CNI is generated by 20 hydro-electric stations with a capacity of about 1540 megawatts, providing 90% of the North Island's hydro capacity. Key power supplying companies in the region are Meridian Energy, Genesis and Mighty River Power. Geothermal stations at Ohaaki and Wairakei have a generating capacity of 261 megawatts, and the Kawerau field produces 7.4 megawatts. A further 280 megawatts of geothermal capacity is planned or under construction on fields around Taupo. Most of the remaining North Island generating capacity is provided by large thermal stations outside the region. Natural gas is available throughout the Central North Island and is a significant energy source for the wood processing industry, especially for timber drying and pulp and paper. In addition, residues are becoming a major energy source in larger wood processing plants to provide heat and electrical energy. Road, Rail & Ports The Central North Island has an extensive network of national and provincial highways and urban and rural roads. The public routes important for forestry are those linking the Port of Tauranga with wood processing centres at Tokoroa, Whakatane, Kawerau and Murupara, and those linking Ohakune and Taupo with Hawke’s Bay. Toll New Zealand operates a national transport network, and has developed total service packages dedicated to servicing the forestry sector's needs. In the Bay of Plenty and Waikato regions 850 kilometres of track links forests, mills and provincial centres, to ports and domestic markets. The Port of Tauranga at Mount Maunganui serves the whole Central North Island region. It is New Zealand's main forestry port handling around 70% of the country's forestry exports, and is also New Zealand's largest exporting port. The Port of Tauranga has storage capacity for 122 000 tonnes of logs, can handle ships up to 290 metres in length and has a low-water draught of 11.7 metres. Labour, Education & Training
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Copyright © Rotorua District Council |
As a result of its central location, much of the forest administration for the central North Island is based in Rotorua. The Waipa sawmill, the largest in Australasia, is located on the outskirts of Rotorua's main urban area. The world-renowned Scion Research is also located in Rotorua, as are a number of quality forestry-based educational institutions and consultancies. A significant depth of experience and expertise exists within the numerous engineering. manufacturing, harvesting. transport. and professional service businesses involved with forestry-related activities. Rotorua's forestry sector directly and indirectly employs more than 2,500 people and generates an estimated NZ$250 million of income per year. 
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