THE future of the 160 workers has been thrown in doubt with New Zealand-based Carter Holt Harvey announcing its Morwell sawmill will close as soon as August.
The decision is unlikely to affect the operation of the CHH sawmill in Yarram.
CHH Australia chief executive Geoff Harris said the Morwell mill was facing a significantly reduced supply and quality of sawlogs as a result of the 2009 Black Saturday bushfires and fires of 2014.
Fires since 2003 have burnt 15 per cent of its pine sawlog supplier, Hancock Victorian Plantations’ pine estate.
Although HVP has replanted all burnt areas, the radiata pines take a minimum of 28 years to mature to the sawlog quality and size used for structural timber.
Without the sufficient volume of sawlogs and because the Morwell sawmill is dedicated to producing structural grade timber for housing, it is no longer viable.
Mr Harris said the company’s priority was to work closely with employees “to ensure the best possible outcome for all staff.”
“We are distressed by our predicament and more importantly, are extremely conscious of the distress of our workers whose livelihoods are now uncertain and threatened.
“But we face the reality that the bushfires have left our supplier unable to supply the volume of sawlogs or the quality necessary to sustain the Morwell sawmill.
“That is horrible for workers and their families, and CHH as a business.
“In the event of a closure, CHH will seek to redeploy staff where possible, meet full entitlements and assist with any transition arrangements.”
CHH will continue to operate its Yarram sawmill, which employs 56 people and produces non-structural timbers.
It is therefore less affected by the lack of supply of high grade sawlogs for producing structural timber.
The Morwell sawmill cannot move to non-structural timber production because CHH has no current market for the extra timber, and other processors are already competing for the depleted log supplies.
Electrical Trades Union state secretary Troy Gray said despite the foreseeable shortage of appropriate timber, workers had not received advanced indication of the company’s announcement.
“Workers tell us this plant was processing more timber than ever in recent months,” he said.
“To say workers and their families were caught off guard is an understatement,” he said.
Construction Forestry Mining and Energy Union national secretary Michael O’Connor criticised the announcement.
“The EBA requires the company to formally notify the union of any planned redundancies and to enter into discussions about their rationale for the closure,” he said.
“It is the company’s obligation to demonstrate to the union and the workers that all possible alternatives to closure have been exhausted.
“But they have failed to do so.
“They have chosen to deliver this shocking news to workers in the most distressing of ways.”
State Regional Development Minister Jaala Pulford said the government was eager to explore options to keep the sawmill operating.
“However, the government has been told the closure is unavoidable given poor sawlog quality and a lack of volume available from the privately-owned softwood plantations which supply Carter Holt Harvey.
“In contrast to hardwood timber supply, the government does not own any softwood plantations and is therefore unable to impact the market between softwood growers and timber processors.
Ms Pulford said the government would work with CHH to ensure every effort was made to connect affected workers to support services.