Joint marketing awaits CNIF sale

By PAULA OLIVER forestry writer

Previously warring forestry leaders are warming to the idea of cooperating to sell their wood under one marketing umbrella - but the opportunity hinges on the unresolved receivership of the country's largest forest estate.

Carter Holt Harvey chiefs have begun testing the waters with local rivals about forming a corporation or joint venture to market New Zealand's radiata pine overseas.

The idea is not new - the difference is the significant thawing in relations between former arch-rivals Carter Holt and Fletcher Challenge Forests.

Carter Holt chief operating officer Jay Goodenbour says that Fletcher Forests has shown a willingness to talk about the fledgling marketing arm.

But without the backing of whoever ended up owning the Central North Island Forestry Partnership - which went into receivership in February - the idea was likely to come to nothing.

"Unless we can somehow bring that entity into the idea of a single-seller desk for the export market, it's going to be difficult to get the kind of scale that we need to launch the thing," Mr Goodenbour said.

"Realistically, we are not in a position of being able to control what happens with the CNIFP.

"But we continue to try and talk with the banks, we continue to talk with the receivers, and we're leaving the door open to any potential purchaser of the CNIFP to work with us to create it."

Mr Goodenbour said some potential buyers had "dropped by" to discuss the initiative.

Carter Holt has a cut of 7 million tonnes a year.

Mr Goodenbour said Fletcher Forests' cut - about 2 million tonnes - would need to be supplemented with the CNI cut of 3.5 million tonnes to make the global initiative viable. Otherwise, it would not carry enough weight on a world scale.

The initiative's benefits, he said, would be felt by all forest owners. A big increase in the wood harvest is expected over the next decade, and most of it will go overseas.

Mr Goodenbour said that where New Zealand owners competed for sales to an overseas country, that country was deprived of a clear idea of the benefits of radiata pine.

By pooling resources, the marketing group could push radiata pine's environmental strengths, launch a solid brand, and possibly lobby for the inclusion of radiata in overseas building codes.

Mr Goodenbour said this joint venture bid had more chance of sustained success than the last attempt to form such an industry group - Wood NZ, which lasted just a year in the late 1990s.

This time, Fletcher Forests was more focused after breaking free of its parent company. And while the two giants had a history of "beating our heads together in overseas markets, trying to gain an advantage for our shareholders," they now knew that was probably the worst thing they could have done.

"If ever there was a time to bring the three biggest players in the industry together, it's now. If we can get them doing what's right for the industry, then it's going to be a lot easier to bring the other industry members together and gain support for what we're trying to do."