Recovery signs after forestry slowdown
There are signs the region is already rebounding from the forestry slowdown.
The region's biggest log truck operator is back on the road and some service sector providers are busy again.
The coronavirus (COVID-19) impact on log exports to China, the Chinese New Year and falling log prices due to increased log exports out of Europe and Australia sparked the crisis last week.
Hundreds of forestry workers and log truck drivers here were stood down and forestry-related vehicle sales and maintenance work through local service providers dried up.
There have been noticeably more log trucks back on the road again since Monday and reports yesterday indicate an improvement in the overall situation.
Pacific Haulage and Williams and Wilshier general manager Campbell Gilmour yesterday said all 90 of their log trucks are back on the road.
“We've had a bit of slowdown over the past week but things have started to pick up again. We were expecting it to be a bit worse than that.
“We're not out of the woods yet but the situation is a lot better than we thought it was going to be,” Mr Gilmour said.
“The situation is still pretty volatile. We don't know how long it will be before things return completely to normal.”
Another log truck operator, Opotiki-based Seymour Transport Services, runs 22 trucks in this region.
“We were working again from yesterday but we don't know for how long,” said owner Charlie Seymour.
“We don't know at this stage how many days we are going to get but we're relieved to be operating again.”
The slowdown has had a spin-off impact on mechanical and vehicle businesses that service the forestry sector.
“It slowed us right down, just dropped off, it died,” said one company representative.
“Our customers decided they would rather pay their staff than do maintenance on their vehicles, which was fair enough.
“But we've heard forestry machinery operators have been given three to four days a week back on the job this week, so that's really good news.”
Heavy Equipment Services director Tony Kendrew said they had a lot of people cancel or defer jobs last week.
“But this week the phone has not stopped ringing with work coming in. We had enough work in our yard already prior to the slowdown, so we didn't have to lay anybody off. But we did face the prospect of reduced hours, and then reduced staff numbers,” Mr Kendrew said.
“But that has changed and we're a lot more confident than we were last week.”
Kendrew said he felt some firms jumped the gun over the matter last week.
“They laid off staff before they really knew what was happening.”
Arne Lewis, from AP Hydraulics, said they had several large projects deferred until further notice in the first two days of last week.
“We are thankful our business is spread over agricultural, industrial and forestry. We really feel for the contractors and their workers with the element of unknown in this situation.
“The uncertainty is bad for the industry and is holding back much-needed investment which flows right into the main street of Gisborne.
“In saying that, we are seeing a rebound quicker than most thought and we would hope to see crews back in full production by end of the month.
“Our message to all in the industry is ‘keep your chins up, it is still early days. 2020 is going to be a great year'.
Fuel supplier company Mini-Tankers owner Carl Brouwer said they were slow last week.
“But this week the demand has really ramped up. Now everyone wants fuel yesterday. Things are definitely moving again. The biggest factor for us was how quickly the slowdown happened. It went pretty cold pretty quickly, basically overnight last Monday.
“Now we are chasing our tails trying to keep up with demand but that's a good thing.
The positive signs continue in Turanganui-Kiwa/Poverty Bay and at Eastland Port.
A log ship was berthed last night to start loading, two others remain at anchor in the bay and a third is further offshore waiting for its turn to load.
The logs are bound for South Korea and China.
The cart-in of logs to the port has increased over the past few days, with 187 trucks into port on Monday, 360 on Tuesday and 450 yesterday.
Eastland Port's Andrew Gaddum said it was good to see positive signs.
“But significant impacts are still being felt by many people and businesses across the region.”
A forestry contracting business owner, who wishes to remain anonymous, said while the Government and those under the Government had moved on the situation, businesses could not wait until next month.
“GST is due February 28. Fuel, finances, employees redundancies, all that will not stop.
“If the Government does not act now by helping all businesses there won't be employment.
“The Government needs to put all those costs on hold at no interest.”
Eastland Wood Council chief executive Kim Holland said after the shock of last week it was great to hear most forest companies were back to business this week and forestry operations and cartage were under way.
“But we are not out of the woods yet as we are still very much in a wait and see mode to see how the situation unfolds in China as they get back to wood processing and manufacturing.”
Some contractors and crews were on reduced hours/days. Others are on standdown.