1. Critical Aspects and Future
Challenges Within the NZ
Forestry Supply Chain

2. Forests + Wood Processing
• 3% NZ GDP
• Export earnings $4.7 billion
• 70% of production is exported (47% as logs)
• Very capital intensive: $20.9 billion invested
• Strategic Action Plan to get to $12 billion export earnings
by 2022

3. Forest Harvest - Radiata pine
40,000,000
35,000,000
30,000,000
)
25,000,000
3
20,000,000
15,000,000
m
V
R
o
b
u
e
a
v
c
r
(
l
10,000,000
5,000,000
Historic Harvest (Actual) Forecast Harvest
-
Historic Harvest (Actual) Forecast Harvest (All Owners) Forecast Harvest (Large-scale Owners)
Forecasts are based on assumptions. This scenario assumes total wood availability is non-declining until 2034. Large scale
Owners availability is at the owners stated intention until 2015 and then non declining.

4. HS&E
12
REGIONAL
AUTHORITIES
41
LOCAL
AUTHORITIES
Compliance Critical to Productive
Profitable Business
•Diversity across RA’s and LA’s
•National Environmental Standard (NES)

5. Activities and Tasks Within the
Supply Chain
• Harvest Planning & Engineering (Critical)
• Harvesting (meat ind)
• Transport & Logistics
• SOP (Sales and Operational Planning)

6. Harvest Planning & Engineering
• Paper plan
• Field visit to assess attributes and hazards
• Generate a prescription
• HS&E
• Road line crew to strip trees
• Construct roads and landings

7. Issues & Opportunities
Current Situation
• Summary of existing engineering principles
• Barriers to implementation of best practice
Opportunities
• Risk management processes
• LiDAR and engineering design processes
• Sub-grade compaction and improvement

8. Existing Body of Knowledge
• The science of building roads is well established
• Geotechnical engineering
• Soil mechanics
• Pavement design
• Hydrology / Hydraulic’s
• Strength of materials
• Geometric design

9. Barriers to Implementing Best
Engineering Practice
• Expertise and skills to use new technology is limited.
• The sheer scale of the national forest roading programme
• A poor forward roading position
• A poor understanding of engineering principles

10. Why Invest in Better
Technology/Engineering
• Based on a harvest of 26.12 million m3 (2011 year end)
• With a 47% cable and 53% ground based
• With respective average roading costs of $10 and $5/m3
• The collective national forest roading prgramme is in the
order of
$200 million (plus)pa
• 14,000kms.
• New forests will require an investment of $1.5 billion over
next 10 years, in roading

11. The Risk
• Infrastructure projects are notorious for running over
budget and time
• One 2003 study carried out by Flyvberg et al looking at
the success of infrastructure projects concluded:
 Cost escalation/over-runs on infrastructure projects are the
norm
 Cost estimates used in decision making are often misleading
and are characterised by large standard deviations
 Roading projects typically exceed estimates by 20%
• The implication if applied to the collective NZ forest
roading programme over the next ten years is a
$400 million cost escalation risk

12. Risk Management and Decision
Making
• How reliable are your estimates?
• How certain are you that the estimates can be delivered?
No estimate should be given without a probability
statement

13. LiDAR (Light Detection & Ranging)
• Provides high quality digital terrain information
• Improved risk identification

14. Practical Application of LiDAR
Standard 1:5,000 harvest plan DTM (with roads & landings)

15. The Low Hanging Fruit
• Greater attention to sub-grade compaction
• Improved pavement construction practice
• Potential cost savings to the industry over the next ten
years if pavement depths can be reduced by 50-100mm
$125 - $250 million
(Based on 14,000 km x 4m wide and assuming an average
delivered metal cost of $45/m3)

16. Removing Barriers to Improving
Sub-grade
• Establish and maintain a forward position
• Project management (operational planning)
• Manage the road-line salvage / construction interface
• Realise the value of these:

18. Harvesting
• Ground based;
 350 to 1200t/day
• Cable hauler;
 180 to 350t/day

19. Critical Aspects and Challenges
• HS&E
 Mechanised log making
 Quality and value
 ACoP Safety in Health in Forestry Operations i.e.
grapple hauler extraction
 Environmental compliance
• Productivity gains
 Improved planning
 Mechanised felling and bunching for haulers
 Mechanised log making
 Maintain and improve quality/value out-turn

20. Transport & Logistics
• On Highway
• Off Highway
• Rail

21. Critical Aspects and Challenges
• Ageing workforce
 Replenishment program
 Recruitment campaign
 Accelerated Driver Licensing
• HS&E
 Improved Training
 LTSC Bronze, Silver, Gold
 HPMV’s (reduced fuel consumption and carbon
emissions)

22. Critical Aspects and Challenges
• Efficiency and Productivity gains
 Work with Port companies to better utilise time and
equipment, as opposed to grizzling about storage
capacity - COLLABORATION!!
 24 x 7, 4 on 4 off x 7
 Technology (GPS, data transfer etc.)
 Improve Port throughput ($5m plus per annum)
 High Productivity Motor Vehicle’s (HPMV’s)

23. Critical Aspects and Challenges
HPMV
• HPMV’s
 Long time in the making
 NZTA working with us
 Second to general freight NOT HPMV!
 31m tonnes pa
 20% > productivity, 9% < fuel use
 8,000 less transactions through
Rotorua pa
 Huge Potential yet to be realised

24. HPMV’s cont’d
• Challenges
 Local authorities struggling with this initiative
 Enforcement, increased axle loading tolerances
 Pavement and bridge upgrades

25. Summary
• Critical Aspects
 Greenfields roading task ahead is ENORMOUS
 Productivity and efficiency gains extended hours etc
 HPMV’s up and running
• Challenges
 Up skill and improve planning & engineering personal
and processes
 Manage the increasing volume effectively
 COLLABORATION across all stakeholders, including
central and local government

26. Investigating Alternative Options in Log Transport….