Govt promises $220m for forestry tech to ease domestic timber shortage

The investment comes despite Australia signing an international agreement at the COP26 summit to end deforestation by 2030 last year. However, Prime Minister Scott Morrison said the Coalition would never support shutdowns of native forestry and would work with state governments to create permanent timber production areas.

Mr Morrison said as the country battled a building material shortage and uncertainty around global supply chains, Australia's forestry industry would be critical to a stronger future.

"Global demand for wood products is set to quadruple by 2050 so this investment in the jobs and future of the forestry industry is critical," Mr Morrison said.

"The pressures on the building industry and the uncertain international trade situation has made it clear that local wood products and local skills are critical. Just ask any tradie who has been trying to get wood products."

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A $100-million National Institute for Forest Productions Innovation will be established in Launceston, with up to five regionally-located Centres of Excellence across Australia, which will be paired with $113 million in grants to accelerate the adoption of new wood processing technologies in manufacturing businesses.

Australian Forest Products Association chief executive Ross Hampton said it was "absolutely possible to get quick wins" from the grant funding and see a "significant amount" of timber injected into the domestic market.

"We need our researchers finding clever ways to get more structural timber out of the trees we've currently got coming in," he said.

"There are new saws that can cut around curves, it's possible to glue smaller pieces of timber to get the strength we need in construction and there's an opportunity to review the timber grading system we use."

The nation's Regional Forestry Hubs, which connect industry and businesses with new technology solutions, will also receive an additional $6.6 million.

Mr Hampton said there was a chronic underfunding of research within the industry, with the number of researchers dropping from 700 researchers down to 20 over the past two decades.

Although the funding would help address some of the timber shortage, the only thing that would solve the nation's systematic reliance on imported wood was a "helluva lot more trees in the ground".

Assistant Minister for Forestry Jonno Duniam said the government wanted to increase Australia's self-reliance when it came to wood supply.

"Instead of importing products from overseas, we want to grow the trees here, process them here and add value to them right here in Australia," Mr Duniam said.

"These investments mean helping our businesses and workers develop new timber products for buildings, turning wood waste into useful materials, and replacing plastics with wood-based bioplastics."

The forestry industry has been under pressure to justify the continued logging of native forests in recent years.

Last week, its economic viability was called into question during a NSW parliamentary inquiry, which heard state-run native forest logging was a poor return on investment for taxpayers, with the industry generating $2.3 million from hardwood, which primarily came from native forests, over five years compared to $64 million in the same period for softwood plantations.

Several studies - which the forestry industry disputes - have found logging native forests drastically increases their bushfire risk.