"The farmers are cross. They fear that forestry is going to crowd them off their land," said Regional Economic Development Minister Shane Jones, in Palmerston North to announce more regional spending.

Still he is convinced of forestry's merits and trying to create more from raw materials in the forestry sector.

"Anything that's going to take raw material in the food and forestry area and turn it into value added, we are prepared to back," Jones said.

Recipients of funding included NZ Bio Forestry Ltd, which received $380,000 towards research into the development of PLA plastics from renewable resources. Usually made from corn, PLA plastic is used in 3D printing and commonly made into single-use food packaging like takeaway coffee cups and shopping bags.


"In New Zealand we have big volumes of sustainable radiata forest but we waste a lot of it," said NZ Bio Forestry Ltd's Paul Morgan. "We're targeting the waste to convert into PLA."

NZ Bio Forestry Limited has been working with the Rangitīkei District Council on a plan to build a commercial bioplastics plant in Marton.

"Marton is ideally suited for some forestry infrastructure development. I understand there's a proposal for $10 million that is wending its way through the process," Jones said.

"Obviously I'm a forestry minister and I'm very much pro forestry, there's a process to go. But in fairness to the proponents and the civic leaders, they've been working on it with my team for quite some time.

"There is every reason to be very hopeful, not only for Marton but also other infrastructure projects around the region. And obviously Kiwirail have demonstrated a very high threshold today."

The Palmerston North Kiwirail hub is an infrastructure initiative that received $40m from the PGF last year.

The regional development fund has also invested $12m in the Whanganui port redevelopment but the minister is frustrated at the lack of progress.

"I think that it's important in an area that is food rich that we invest in infrastructure. I want to get cracking on upgrading the Whanganui port. I think there's a great future for the Whanganui port offering a coastal trade service, freight service.


"A lot of these projects don't have the allure of Silicon Valley but in the provinces, unless we endow ourselves with the infrastructure, it is very hard to see how secondary and tertiary investors can follow up," Jones said.

The Provincial Growth Fund is also backing smaller enterprises too, including The Herb Farm in Ashhurst.

"There is a cross-section of things that we're doing," Jones said. "There's a cross-section in terms of large expensive infrastructure projects and garden variety Kiwis having a go and getting access to some putea from the Crown.

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