THE COST OF TIMBER

Hokitika Guardian, 8 September 1923, Page 3

THE COST OF TIMBER

EFFECT OF THE ROYALTIES. EXCHANGE WITH AUSTRALIA. I Exchange i. The suggestion that the Government is encouraging an increase in the price of timber, through the operations of the State Forest Service, was discussed at Auckland this week, by a gentleman who for many years has rieen closely identified with the timber industry, both export and otherwise. He referred to the question of increased royalties. which lrad been specifically dealt with in a telegram sent to Ministers, by the Auckland Sawmillers and Woodware Manufacturers' Association. The statement in that telegram that the Forestry Department was exacting higher royalties, could, he remarked, he borne out by the fact that on the West Coast, royalties bail' increased 10(1 per cent since the Department had bail the administration of certain forest areas. That being so, it naturally followed that the public had to pay higher prices for sawn timber. Referring to the statement by the Commissioner of .State Forests that the timber was put on to the market by auction, this informant pointed out that in such eases a reserve price had always been fixed, and generally that price had been in excess of current royalties. There had been several transactions where the timber had not been submitted to auction, and where the Department had exorcised considerable discretionary powers in disposing of Stale timber.

Where there existed a Forestry Department that was an ambitious anil expensive department, it necessarily followed, this timber expert said, that additional royalties hail to he incurred to compensate for departmental expenditure. Incidentally he pointed out that the proceeds of the sale ol timber were considered by the depart-

ment as revenue, when, in reality, sueli income was derived from the disposal of a capital asset. Particularly did that apply to kauri timber which, (hut it was felled and sold, could not he replaced. If replacement were possible, and the replacement value were put on the kauri sold to-day, it would run into many pounds per hundred feet, having regard to the hundreds of years it lakes for a kauri tree to reach malurltv.

Dealing with the question of timber prices from the viewpoints of the ordinary man who wants to huild, tho speaker said the fact that royalties were increased, must reflect upon the cost of any building, whether it he a humble "shack” or a palatial residence. Naturally the consumer was inclined to blame the sawniiller anil merchant for the augmentation of prices; hill, in point of fact, if only the buyer would look a little deeper into the matter, he would the better he able to place the blame upon the shoulders of I hose who rcallv were re-

sponsible. On the question of export, continued this authority, il must lie understood that tin* elfect of the building regulations made it incumbent to use heart timber, and it naturally followed that there was a large quantity of sap and the more perishable variety of wood produced. That wood had a ready sale in Australia, on account of the shortness of supplies of soft woods ill the Commonwealth. In older to use up the whole contents of a log, ir was necessary that there should he a constant cutlet for the lower grades. Australia willingly absorbed those lower grades, consequently the snwiniiler was able to provide timber requited for the New Zealand market at a lower rate than if such an outlet were closed. A- a matter of fact, the business with Australia resolved itself into an exchange of commodities, Australia taking New Zealand's soil timber, and in return sending to the Dominion eon-ith.-ralile quantities of sucti liar,Bloods as janah. iron hark, tallow uooil, and other well-known varieties.