Kangaroo Island timber deal could save Morgan Sawmill at Jamestown

A landmark deal could help solve a statewide timber shortage and save a family sawmill, providing the government steps in to help.

A landmark deal that would deliver thousands of tonnes of pine from Kang­aroo Island has the potential to save a historic family sawmill in the Mid North and ease a statewide timber shortage in the building industry.

But the deal is dependent on the federal government stepping in to help pay transport costs using a bushfire-relief scheme only made available to fire-damaged timber plantations in the eastern states.

Owner Luke Morgan says Morgan Sawmill, which employs 75 people in Jamestown, the Riverland and Adelaide, is at risk of going out of business if the government is unable to help meet transport costs.

Mr Morgan, whose family has run the sawmill for three generations, said without the wood from Kangaroo Island, he would need to start laying off staff from July 1.

The Jamestown mill has had a contract to buy timber from ForestrySA, which has plantations in the Adelaide Hills, for the past 35 years.

But Mr Morgan missed out on a tender in the latest round of ForestrySA contracts and said he believed his usual allocation would be sold to an exporter.

Morgan Sawmill owners Matthew Morgan, Ed Morgan, Candice Kalisch and Luke Morgan in 2014.

Mr Morgan has agreed on a price with Kangaroo Island Plantation Timbers (KIPT) to replace the ForestrySA wood, and the deal has the potential to keep the mill in business for at least a decade. Both parties say they need the government to help subsidise the transport costs to make it viable.

KIPT managing director Keith Lamb said the cost of carting the logs was the only thing preventing builders accessing enough wood for 10,000 homes.

The logs need to be carted on semi-trailers from west of Parndana to the SeaLink ferry, then from Cape Jervis to Jamestown, more than 400km by road.

Mr Lamb said if the government was unable to extend its assistance program to South Australia, the structural pine earmarked for Jamestown was likely to be exported to India.

“The only viable market available for us right now is the export market through Port Adelaide to India,” Mr Lamb said. “We have the wood stockpiled on Kangaroo Island ready to go.”

KIPT this week agreed to start stockpiling wood at Port Adelaide to deliver 30,000 tonnes a year to India.

“That’s the only market that’s available to us at the moment which is a positive market,” Mr Lamb said.

KIPT shipped 300 tonnes of pine off the island in March by loading a barge at Kingscote. The wood was towed to Port Adelaide where it was loaded aboard a ship bound for a customer in South Korea.

It also sent one semi-trailer of wood to Jamestown and two to the South-East for mills to assess the quality of the trees, which were damaged during Black Summer bushfires of 2019-20. All mills have ticked off on the quality of the wood.

Mr Lamb, Mr Morgan and the Master Builders Association of SA are lobbying Assistant Forestry and Fisheries Minister Senator Jonathon Duniam for up to $6m from a forestry transport assistance scheme he announced last May, which was only available to Victorian and NSW plantations.

Kangaroo Island Plantation Timber managing director Keith Lamb. Picture: Sarah Reed

Master Builders Association of SA chief executive Will Frogley said builders risked losing their businesses without access to the Kangaroo Island timber.

“Timber supply is a global issue,” he said.

“Fortunately, there is a local solution that would breathe confidence into not just our industry but also homebuyers and the wider economy.

“South Australia is in the enviable position of having a solution right on our doorstep and we must capitalise on this unique opportunity to enable South Australian builders to use South Australian timber to build homes for South Australians in a timely manner.

“The assistance we are seeking is the same that was provided to the eastern states and will ensure SA maximises the benefits of record-high building approvals and protects jobs in not just our industry but also the state.”

Senator Duniam said he was aware of the proposal and “looking forward to examining it in detail”.

“As a Government we are committed to supporting the forestry industry, including on Kangaroo Island,” he said.

“The Government has committed $65 million in bushfire recovery support, including through the $40 million Forestry Recovery Development Fund Program.