The Irish Timber Council (ITC) is warning 2,500 jobs could be lost if the government sells the State forest harvesting rights.
The ITC represents the 10 sawmills around Ireland and says the move could result in the closure of the facilities.
Sawmill owners say the sale of Coillte's harvesting rights to private operators would have a negative impact on the sector.
The ITC has published a new report which claims that it makes no sense for the government to proceed with the sale from a either a commercial, economic or financial point of view.
According to the report, prepared by EPS Consulting, any benefit to the Exchequer arising from the sale will be small and disproportionate to the negative impacts on the sawmill sector.
These impacts include:
- The purchaser could choose to export all of the available log thereby depriving the sector of 80% of its supply requirements. With no other supply alternatives available in Ireland, sawmills would be forced to close and jobs lost in rural communities
- The purchaser could also seek to drive up prices by withholding supply and thereby increase prices to an unsustainable level leading to sawmill closures
- The purchaser would have no commercial imperative to supply sawlog at regular intervals, as Coillte does, to meet the demands of the sawmill sector
- The purchaser could restrict the sawmills from having the flexibility to harvest sawlog in line with fluctuations in production demand
- A disruption of supply to the sawmills will result in a shortfall of residue product (woodchips, sawdust, bark) which Ireland’s board mills are completely dependent upon
- It says that an alternative to the full sale of harvesting rights is the option of a partial sale on a phased basis.
The report also advises that if the government does proceed with the sale then there must be guarantees put in place "that will protect security of supply for the sawmill operators".
Pat Glennon is the ITC Chairman.
He says his members fear that new owners would increase the price of timber logs.
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Meanwhile People Before Profit TD Richard Boyd-Barrett is calling on the government to rethink thier plan.
