Benalla workers worried about job losses as ForestOne scales back operations

Australia Broadcast Center

2 days ago

A north-east Victorian community has raised concerns about the partial closure of a wood supplier's local manufacturing site with "significant" job losses flagged.
ForestOne, a major employer in the area, announced on Friday it would close its dry sawmill and particleboard manufacturing operations in Benalla.
Local media reported an employee had said there would be 140 job losses, but the company told the ABC there would be "much, much less than that".
The company would not say how many jobs were expected to be lost because it was confidential information and they were still "working through that".
The company has not said when the closure would occur at the site, which has 150 employees.
Bakery manager Andrew Bertallis said the partial closure would have flow-on effects for local businesses.
"It is huge dollars out of the community each week," he said.
"It is going to affect everyone in Benalla."
Local butcher Paul Rettke said it was a tough development for the community.
"There is going to be people that you know that are out of work," he said.
"Family people with mortgages with kids to feed.
"We have got a few customers that work out there. [They] have been there for a long time, a lot of them. You are talking 20-plus years."
ForestOne managing director Ian Fankhanel said in a statement that increased manufacturing and external costs had "made it unviable at the present time to continue making particleboard and drying timber".
"Additionally, we face ever-increasing governmental and compliance costs to do business," he said.
The company said it would continue to run its green sawmill manufacturing and lamination line.
"We continue to face weak market conditions and, unfortunately, the outlook is still very poor," Mr Fankhanel said.
"The prices being sold at in the market are some of the lowest we have seen in 20 years, with no significant lift in demand on the horizon."
The company said 80 per cent of Benalla products were sold into Victoria due to high freight costs to transport interstate.
"We hope that, in the future, if and when demand returns, we can recommence full production again."
The ABC has contacted the CFMEU's Manufacturing Division, which represents the facility's workers, for comment.
Nationals Member for Euroa Annabelle Cleeland said it was a tough time for the Benalla community.
"I think it is just heartbreaking what we are hearing ... of so many jobs being made redundant and axed during a cost-of-living crisis," she said.
Ms Cleeland said the number one issue she would raise in parliament next week was how to support regional businesses in Victoria.
A Victorian government spokesperson said the government knew it was a difficult time for workers, their families and the broader community.
"Regional Development Victoria is working with ForestOne, Benalla Rural City Council and Workforce Australia to support the transition of impacted workers and to understand the broader economic and social impacts arising from this decision," the spokesperson said.
"We continue to support businesses across Victoria.
"We have cut or abolished taxes 65 times and we are continuing to remove the red tape that holds many businesses back."
The Victorian Forest Products Association is the peak body for the state's wood fibre industry.
Chief executive Andrew White said the state's timber industry was feeling the effects of a depressed housing market.
"We are seeing build times for houses have blown out from around six months to 10 months," he said.
"Whilst there might be more homes being started, they are not being completed as quickly.
"It means there is an impact on those suppliers."