A proposed timber processing facility near Lae is positioned to fill a niche and play an important role in the Papua New Guinea forestry industry’s future, according to Tony Bartlett, forestry research program manager at the Australian Centre for International Agricultural Research (ACIAR).

Tony Bartlett and a group of PNG farmers among teak trees  Source: ACIAR

Tony Bartlett tells Business Advantage PNG that, with proof-of-concept finalised, ACIAR’s project is seeking investment to take the facility through to the development stage.

ACIAR is an Australian organisation that supports research for development projects in about 40 partner countries.

The organisation is leading a range of forestry projects operating in 14 countries, with each project targeting aspects of the value chain.

As part of this project, ACIAR has worked with the Papua New Guinea government to research the development of a central processing facility for timber coming from community-owned forests.

‘The global market for wood products is continually growing.’

Bartlett believes the facility will assist local landowners and farmers by adding value to their timber.

Business plan

The government was unable to fund the delivery of the project, so ACIAR partnered with the Timber and Forestry Training College of the PNG University of Technology to explore whether a viable business plan could be developed.

While the training facility is in a need of a major refurbishment, Bartlett says its location, just outside Lae, is ideal and he could see the potential in the facility, if investment is secured.

‘The global market for wood products is continually growing. The Papua New Guinean government has acknowledged this and is hoping the facility will provide capacity to add value to timber domestically, and therefore keep a proportion of the income in Papua New Guinea.’

‘If investment is secured, the facility will benefit from new sawing.’

‘By moving away from relying on log exports, the government hopes to develop new domestic and export markets for processed timber, which it hopes will lead to more jobs, training and growth in the area,’ he says.

Investment

A PNG sawn timber processing facility Source: ACIAR

Investment of around K1.4 million is needed to get the project off the ground. According to ACIAR, the facility will be profitable from year one.

‘The business plan has already been developed, making this a great opportunity for private business to get involved and invest,’ Bartlett says.

‘Papua New Guinea is well endowed in forestry resources, which makes the sector an important player in the country’s future.’

Should investment be secured, the facility will benefit from new sawing and drying equipment and a range of machines that will add value to the timber.

‘As Lae continues to develop as a city, the need for quality timber for local construction is growing,’ Bartlett says.

‘If farmers can access a central processing facility, they may receive better returns for their timber. It will also provide an opportunity for farmers to access the local market,’ he adds.

Training

Providing farmers with education and training on how to manage their trees and how to add value in the processing stage will play a key role in ensuring the sector continues to grow, Bartlett says.

‘Techniques such as pruning branches and thinning trees in newly planted woodlots can double the value of the tree.

‘The facility is likely to lead to a boost in local jobs.’

‘Work by ACIAR projects in other countries has shown that farmers are willing to adopt these practices, when they see that it helps them secure higher returns for their work.

‘This sort of support and investment in training and education from the government and industry-based organisations is critical,’ he adds.

Seeking to educate smallholder tree growers, ACIAR runs an Australian program called the Master Growers Scheme, which provides tree management training and an understanding of market requirements to farmers.

ACIAR launched the program in Indonesia and Vanuatu, and Bartlett hopes it will be trialled in Papua New Guinea at a later date.

The Lae timber processing facility is in its early stages, but Bartlett says the project could play a fundamental role in the development of the local industry.

‘The facility is likely to lead to a boost in local jobs, including skilled positions in administration, sourcing and processing, as outlined in ACIAR’s plan.

‘This is a great opportunity. Papua New Guinea is well endowed in forestry resources, which makes the sector an important player in the country’s future.’