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Some 3000 jobs in Fiji’s timber and sawmilling industry may be lost if the department of Forests does not review its decision for a 56 per cent to 270 per cent increase in timber royalties.
The Fiji Sawmillers Association, comprising 16 sawmilling operators, continues to express disappointment of its failed attempts for an audience with interim Minister of Forests Joketani Cokanasiga to iron out this issue.
And the association has warned that failure for an immediate intervention by the interim minister would result in a wide retaliation against the increase in timber royalties.
“Certain large members sawmills in Vanua Levu have already indicated that they will not be able to sustain the exorbitant royalty hike and will shut down their forest operations putting more than 200 workers jobs on line if the royalties are enforced,” association president Jay Dayal said.
“Other members have also indicated as a sheer economic decision to temporarily halt harvesting operations in the forests as none of them can afford to pay the ridiculous royalty rates slapped on them,” he said.
Dayal said sawmillers in Fiji already had huge stock of timber floating around their storage yards.
“We do not accept the new royalty rates and will not legitimise it by paying it,” he said.
Dayal said the local construction industry would also be badly affected with the new royalty rates and as a result have native hardwood species losing a chunk of its market share due to its expensive prices resulting out of the exorbitant royalty rates.
He said certain classes of lower grade specie would also lose its export market entirely because it would not be able to compete with similar but cheaper products from Asian countries.
“The royalty hike will create a huge cash flow burden on the sawmillers who are already being hammered by their respective export customers to reduce their selling prices.
“Secondly, if the Minister fails to respond even within time we would file injunction applications as well in addition to the above retaliatory measures. And it goes without saying that if harvesting operations comes to a halt, the processing facilities will need to be shut down until the matter is resolved.”
Cokanasiga was in a meeting and could not be reached for a comment.
The Association members are Fiji Forest Industries, Valebasoga Tropikboards, Vitiana Timbers, Waiqele Sawmills, Dayals Sawmills, Southern Forest Products, Nur Ahmed & Co, Sustainable Forest Industries, Touchwood Investments, KKK Sawmills, Design Tech Sawmills, Hanshine Industries, Dalomo Holdings, Lumber Processors, Tropik Forest JV Ltd and Taiwan Timbers.
