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Potential bad news

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Unconfirmed reports could see more redundancies in Morwell

UPDATE: 11.00am

Carter Holt Harvey (CHH) has announced that it is consulting with staff on the possible closure of its Morwell sawmill.


16 May 2017 11:00 AM AEST - Morwell Sawmill, Latrobe Valley, Victoria

Chief Executive of Carter Holt Harvey Woodproducts Australia, Geoff Harris, said the Latrobe Valley-based sawmill in Victoria – which employs 160 staff - is facing a significantly reduced supply and quality of sawlogs for its Morwell sawmill.

This is a direct result of the catastrophic predominately arson-lit bushfires of Black Saturday in 2009, and the subsequent fires of 2014.

As a result, CHH has begun consultation with staff, including the possible closure of the sawmill. Fires since 2003 have burnt 15 per cent of its pine sawlog supplier, Hancock Victorian Plantations’ (HVP) pine estate.

Although HVP has replanted all burnt areas, the radiata pines take a minimum of 28 years to mature to the sawlog quality and size used for structural timber. Despite its efforts over past years, HVP can no longer continue to supply the diameter, quantity and quality of mature sawlogs needed to produce structural timbers.

Without the sufficient volume of sawlogs and because the Morwell sawmill is dedicated to producing structural grade timber for housing, the sawmill is not viable into the future.

However, no final decision has been made, and CHH has now entered into good faith consultation and negotiations with employees and their representatives around the future of the sawmill.

“The absolute priority of CHH is to work closely with employees to ensure the best possible outcome for all staff”, Mr Harris said. “We are distressed by our predicament and more importantly, are extremely conscious of the distress of our workers whose livelihoods are now uncertain and threatened.

“But we face the reality that the bushfires have left our supplier unable to supply the volume of sawlogs or the quality necessary to sustain the Morwell sawmill. That is horrible for workers and their families, and CHH as a business.”

“In the event of a closure, CHH will seek to redeploy staff where possible, meet full entitlements and assist with any transition arrangements.”

No definitive timeline has been set, although CHH believes it is in everyone’s interests to resolve the matter as soon as practical, having regard to consultation and ongoing mill viability.

CHH will continue to operate its nearby Yarram sawmill, which employs 56 people and produces non-structural timbers. It is therefore less affected by the lack of supply of high grade sawlogs for producing structural timber.

The Morwell sawmill cannot move to non-structural timber production because CHH has no current market for the extra timber and other processors are already competing for the depleted log supplies.

PREVIOUS: There are unconfirmed reports that a company in Morwell may announce a mass redundancy scheme this morning (May 16, 2017).

The company, which employs approximately 200 individuals, has summoned all workers to a meeting at 11.00am this morning.

According to an anonymous source, union representatives were called to an 8am meeting with upper management.

This story is developing - more to come.

Article continues below

If the rumours are true, then the town of Morwell will be plunged even further into turmoil.

Late last week, Member for Morwell, Russell Northe met with Shadow Minister for Small and Medium Enterprises, Neale Burgess, calling on the Andrews Government to provide real jobs for people in the Latrobe Valley.

Mr Northe said that a number of local businesses had closed their doors in recent months and it seems Daniel Andrews and his Government are oblivious to this happening.

“The retention of jobs in our community is absolutely critical yet all we hear are hollow words from the Premier,” Mr Northe said.

“We have had businesses such as BOC Gases and Alternate Dwellings close their doors in recent months, whilst Johnson Health Tech is soon to relocate out of the Valley with further job losses.

“Now the Latrobe Valley Hotel in Morwell has closed which is a bitter blow for those workers and our community more generally,” he said.

Mr Northe said the Latrobe region had one of the highest unemployment rates of all Victorian municipalities.

“In the short space of just two years under the Andrews Government, unemployment has risen in Latrobe City from 7.3 per cent to 11.2 per cent, an increase of more than 50 per cent,” Mr Northe said.

“1,352 more local people have joined the unemployment queue since December 2014, verifying that the Andrews Government is more focused on its own issues than supporting Latrobe Valley residents.”

Shadow Minister for Small and Medium Enterprises Neale Burgess said it was outrageous the Andrews Government refused to stand up for the Latrobe Valley and secure local jobs.

“Daniel Andrews promised he would fight for every job in the Latrobe Valley, but the only job he is fighting for is his own,” Mr Burgess said.

“Daniel Andrews has broken his promise to secure jobs in the Latrobe Valley.”