Imported timber could be processed at Heyfield’s timber mill as its owners consider how it might remain open without the assistance of the Victorian Government. Source: The Weekly Times
The Weekly Times understands imported plantation timber is among the options Hermal Group is considering to keep the dry mill, or timber manufacturing part of the business open, when its green mill closes in August.
It is understood importing timber, using different species and different timber cuts, will be considered as Hermal endeavours to operate the Australian Sustainable Hardwoods mill without a timber supply contract from VicForests.
ASH currently employs about 250 people but it is likely as few as 60 jobs would remain if the business was reduced to using processed timber rather than raw logs, and it is not clear what quantities of timber would be available for processing.
About 50 jobs will be lost in mid to late August when the green mill closes.
The revelation that the business is considering using imports comes after Hermal rejected a Government offer to buy the mill, Australia’s largest hardwood manufacturer.
The owners have been considering closure since January when VicForests reduced the available timber supply by half. The owners of the mill met with workers at Heyfield this afternoon where Hermal Group owner Ron Goldschlager slammed the Victorian Government for its handling of the issue.
“What I am clear about is that it is uneconomic, uncommercial and most unrewarding dealing with the Victorian Government and in terms of ASH I don’t want anything further to do with them,” Mr Goldschlager said.
“The staff and I were told on 17th March, through the media, by Mr Andrews that he was going to save the mill and their jobs by purchasing the mill.
“Mr Andrews wanted to offer less for the mill than we have invested in it and far less than would be returned through closure. This would also be significantly less than the residual value of the stock.
“For what Mr Andrews has put my staff through, as far as I am concerned I no longer have confidence in him and all job losses at the mill are on his head.”
Last week, the Government reportedly made an offer in the order of $20 million for the business plus $20 million to take on its debts. But an independent valuation, commissioned by Hermal, has suggested it could be worth up to $42 million.
A Government spokesman this morning said it had made “fair and reasonable offer to the Hermal Group, which would keep the mill open and secure local jobs”.
“We call upon the Hermal Group to continue engaging with the Government so we can secure the future of the mill and protect its jobs,” the spokesman said.
In a statement last week, the owners said they had “looked at importing sustainable plantation logs from Tasmania and Ash species from Chile, however, sadly none were able to be progressed”.
