Modern new sawmill possible at Waverley - if forest asset acquired

The new owner of Waverley Sawmills says a more modern mill could be built there within the next few years. Photo file / Lewis Gardner

The South Taranaki town of Waverley could get a big new sawmill if the buyer of its mill can acquire enough forest in the area.

Waverley Sawmills was bought by Wade Glass, one of two foundation shareholders in Spectrum Group Ltd. He said it owns forests, sawmills, logging trucks and a log trading business and has grown from nothing in about six years.

Its two focus areas are South Taranaki/Whanganui and Gisborne.

When he bought the Waverley mill he hired a forestry consultancy to discover the best use for the site, given all the forest that will mature around it in the next 10-12 years.

The consultancy found two options. Glass will not say what they are, but did say they will need a lot of capital spent to build a modern mill on the site.

The current mill would have to be "almost levelled" first. The new mill would be more automated, process bigger volumes and create fewer and more skilled jobs.

The site has two advantages - the forestry surrounding it and the fact that it already has resource consent.

The new mill can only happen if Spectrum Group can acquire enough forestry resource in the area to supply it.

"The focus for the rest of this year will be on acquiring further forestry resource in this area," Glass said.

He cannot talk about the process, because he is bound by a confidentiality agreement.

If a new mill was to be built, it will not happen for at least two to three years. Waverley Sawmills had to close in the interim.

"Given the state of the business as it was, we were not in a position to keep funding losses while that work was done. We were forced to shut the business before we purchased the assets."

Also, at the moment Spectrum Group is focused on its business in Gisborne.

In March 2018 it bought a Gisborne sawmill that had been closed for seven years. In April it hired 45 people to run it, and is busy training them and recommissioning that mill - Far East Sawmill Ltd.

Glass hopes to create more jobs there.

"We are trying to help grow the sawmilling industry, not destroy it," he said.

He agrees with Rotorua-based forestry industry consultant Dennis Neilson that New Zealand wood processing needs huge fully automated mills processing large volumes, in order to drive the cost of wages down and enable them to compete internationally.

He said some mills were managing to do that - Rotorua's Red Stag Timber, for example, which produces a million tonnes of structural lumber a year.