Timber contract in £100 million boost for Welsh economy

In an important development for the Welsh timber industry, Natural Resources Wales has signed a major long term contract with a leading Wales-based sawmill.

The contract with BSW Timber’s Newbridge-on-Wye sawmill will be worth more than £20 million to Natural Resources Wales and an estimated £100 million to the Welsh economy.

The contract guarantees a supply of 600,000 cubic metres of larch over ten years from the Welsh Government’s woodland estate.

This is alongside existing contracts with BSW to supply 700,000 cubic metres of spruce over the same time period.

The contract, a mix of roadside (pre-felled trees) and standing timber will help provide stability for the industry and enable it to develop new markets for felled larch trees.

The larch being felled is one of the largest forestry operations ever mounted in Wales to slow down the spread of Phytophthora ramorum, a disease which has infected over six million trees in Wales.

BSW Timber has invested heavily in its Newbridge-on-Wye Welsh sawmill over the last 10 years, as a result of previous long term timber supply contracts with Natural Resources Wales and their predecessors.

This latest development has enabled BSW Timber to prepare detailed plans for expansion by utilising a wider range of log specification and species to deliver a range of solutions for the construction, fencing and garden products markets.  Further details of investment at the Newbridge operation will be released later in 2014.

At the same time, Natural Resources Wales is also working with the timber industry to further develop new markets and acceptance for the felled larch in the construction industry to build new homes in Wales.

Traditionally other timber, such as spruce, has been used in construction but larch is equally suitable as a building material.

Developing new markets for the processing sector is essential for the industry as there will be more larch available over the next 10 years due to the large scale felling operation.

Since the disease was first identified in Wales in 2010, more than 6,000 hectares (14,500 acres) of woodland have become infected, which is roughly around six million trees.

More than two million larch trees on the Welsh Government woodland estate have so far been felled with more work planned in areas like Cwmcarn Forest.  

BSW Timber’s Chief Executive Tony Hackney said:

“This long-term supply deal is a significant vote of confidence in BSW Timber and the Welsh timber industry.

“It allows us to plan for the future with a strong focus on market needs and requirements, enabling us in turn to invest with confidence in the development of our mill at Newbridge-on-Wye.  

“Increased capacity will mean more shifts and more jobs for the area, and the ten-year supply guarantee will allow us to continue invest in developing the site, reinforcing our pledge to maximise our supply and production of home-grown timber.”

Trefor Owen, Director for National Services for Natural Resources Wales, said:

“This is good news for the timber industry in Wales and provides much needed stability for one of the largest companies in the Welsh timber industry.

“They will make a major contribution to dealing with the harvesting and marketing of larch in Wales which we have to fell.

“We are also in the process of agreeing further contracts within Wales to ensure we maintain a reliable supply of timber to the industry.”

Natural Resources Wales has felled more than 2 million larch trees so far, and managed the supply carefully to avoid flooding the market and provide stability to timber markets.

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