What are we doing to ensure forestry doesn't follow Ford?

Australia once had a forestry sector the envy of the world. Thanks to abundant resources, cheap power, access to markets and innovative and pioneering managers and workers, Australia once boasted comparative advantage in spades. For more than a century the industry was the backbone of many regional centres from North Queensland to south west Western Australia. Australian wood built our homes and produced the world's best paper.

But those advantages have been whittled away and now we are paying the price.

In 2013 we see an industry shrunk to a quarter its size of fifty years ago. Hundreds of smaller mills have closed. Thousands have been forced out of work in our towns.

And yet it is not as if Australians have stopped buying forest products. It may come as a surprise, but in fact last year we spent $4.2 billion dollars on overseas made timber and paper. In the same period we exported only about $2 billion worth.

The high Australian dollar shoulders some of the blame for this dramatic shift, but in truth our policy makers have, by and large, sat on the sidelines and watched it happen. And before the rationalists leap in to pronounce that the retrenched forestry workers can simply shift to mining, it is important to note the less obvious costs of such passivity to our nation. We are allowing to wither the capacity, the capital and the established markets which are vital if the industry is to be capable of surging to meet the well-defined global post- GFC demand.

Other countries have unashamedly fought to ensure their timber industries transition from heritage status to this new future. In Canada, for example, the government has backed a bold drive to unlock new products by co-investing in a $90 million dollar forestry innovation institute. In Japan, the introduction of a feed-in tariff program that rewards renewable energy has enabled Nippon Paper to construct a power generation plant which will run entirely on woody biomass. In Norway the authorities have instituted a "wood first" policy for government buildings. If you invest in a forest in the United Kingdom your timber sales are free from income tax in recognition of the long term nature of your commitment.

And in Australia? Here we have ignored the scientifically constructed regional forest agreements (RFAs) which took into account biodiversity and threatened species and established a network of forest conservation reserves and working forests. Those working forests constituted only about 6 per cent of the total forest area. (It is worth noting that forestry operators actually only harvest a tiny proportion of that 6 per cent. If the total forest area is represented by the MCG, the area harvested in any year is less than the centre circle.)

Instead we have re-labelled thousands of hectares of managed forest, including in some cases plantations, as 'reserve'. This effectively sealed the fate of many regional mills that could no longer see available resource over the horizon.

In addition we were so spooked by the poor execution of the managed investment schemes that we have abandoned the field and we are not planting sufficient long rotation trees that require equally patient investment.

Our government departments seem content to consume vast quantities of overseas paper from dubious sources rather than our own (even when the Australian variety is recycled and fully accredited and underpins regional jobs).

We have thrown up every barrier imaginable before those who would try to build a pulp and paper producing mill here to drive our own resource use further up the value chain.

We even failed to provide renewable energy certificates for native forest biomass as a green energy source - despite bipartisan agreement that we could achieve 7 per cent of our 2020 renewable energy target this way without cutting down a single additional tree!

We are at a key moment in time.

Australia has a proud 200 year history as a forestry pioneer. I believe we can look forward to another 200 years. But only if we acknowledge that, as a major regional employer and the obvious choice in a carbon constrained future, the industry deserves policy attention to transition from its heritage status to the new world. It is an absolute certainty that forest products will play a big part in the lives of our children and their children. It really is up to all of us to ensure that there will still be paper, packaging, timber and timber products on their shelves proudly displaying "Australian made".