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Machinery giant expects recovery

Posted on November 25, 2009, 8:08am and updated on November 25, 2009 at 11:16 am

Komatsu Forest had expected to supply $32m worth of harvest machinery to Timbercorp over the coming four years for the looming bluegum harvest in its biggest Australian deal.

Those plans, which would have seen the global equipment manufacturer expand its South East workshop, collapsed with the downfall of the managed investment scheme company.

But an international leader of Komatsu has visited the South East this week to continue the company’s dominance in the region and retain its 50pc share of the Australian forest harvest machinery market.

Executive vice-president Toshiya Yasukawa hopes to position the company to be a major player in harvest of the region’s hardwood plantations after 120 Komatsu machines have long been active in pine plantations surrounding Mount Gambier.

Prototype harvesters have already been tested in the district for thousands of hours in preparation to introduce new equipment to the market.

Mr Yusukawa arrived from Komatsu’s manufacturing base in Sweden on Sunday night and spent Monday and Tuesday in Mount Gambier ahead of two days in Gippsland to gain feedback on what should be featured in future machinery models.

“Since the global financial crisis last year, the market has been very slow — it has been a very weak year so far,” he said.

“Worldwide demand for wheel-type forestry equipment has been down more than 50pc compared to 2008 — it is a huge drop.”

However, he said a strong turn-around was expected in the next six to nine months.

“Then the bluegum harvesting will have to start and we see it probably improving about 30-35pc next year,” Mr Yusukawa said.

Valmet Komatsu Forest national sales manager Brenton Yon said although markets had dropped, the economy and industry were expected to swing back quickly.

But he does not expect the new owners of Timbercorp’s forestry estate — Global Forest Partners — to honour the previous supply agreement.

“I think they will do it differently — Timbercorp did their own harvesting, but the new owners will probably employ contractors rather than harvest themselves,” he said.

“Depending on who gets contracts, we could supply a lot of gear, but you never know — that agreement we had is now just a nice piece of paper to look at now and again and not worth much.”

Mr Yon said he planned to meet with the new owners in a fortnight.

Meanwhile, he said Great Southern had always used contractors for its plantations, which appear set to be taken over by Gunns — a company that may need the hardwood estate to help sustain its Tasmanian pulp mill in a move away from old growth forests.

“We are just getting ready with bluegums and don’t have a lot of machinery in that field, but that is where the growth is,” Mr Yon said.

He said pine activity would remain stable and it was previously hoped the bluegum boom would come over the next two years, but that had blown out to three to four years due to the managed investment scheme collapses and economic slowdown.

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