Sustainable regional hardwood industries: the potential

NZDFI has a vision of creating 12 regional hardwood industries based on centralised processing operations supplied by growers in surrounding wood supply catchments. Work is well underway with partners in priority regions to develop cohesive, long-term plans. 

A wood-supply catchment approach

The only path to developing sustainable regional hardwood industries is by achieving strategic annual planting targets in wood supply catchments with centrally located future processing sites.

Potential regional wood supply catchments to support a sustainable durable hardwood industry

NZDFI has identified 12 potential wood supply catchments with suitable environments for growing durable eucalypts (Map 1).

Each potential wood supply catchment is shown by an indicative circular boundary, which is a 40km 'as the crow flies' radius from a possible central processing site. Processing sites will be on industrially zoned land. They need good transport connections, including links to a port given the potential for export of surplus logs and durable timber products.

Land Use Capability (LUC) classes 5-7, and plantation forestry land is the type of land which could be available for durable eucalypts. Sites must have environmental conditions which suit NZDFI's species. They will generally need appropriate topography and access for harvesting.


Map 1: Potential regional wood supply catchments to support a hardwood industry. The circles show indicative 40km radius catchment boundaries, centred on a potential processing site location.

NZDFI's priority regions

The three priority regions identified by NZDFI are the  Hawke's Bay, Wairarapa and Marlborough. They all generally have moderate winter temperatures and hot dry summers. Long-range climate predictions indicate summer droughts in these areas will become more frequent and intense.

We have begun to look in detail at how a wood supply catchment might work in the Wairarapa, northern Hawke's Bay and Marlborough.

Regional hardwood industries: land use and log supply

A recent study by Scion* provides a full analysis of the implications of a small or a medium-sized regional hardwood processing operation. A small-scale operation is estimated to require 50,000 cubic metres of logs per annum; a medium-scale operation requires 80,000 cubic metres of logs per annum.

The NZDFI planting target for each wood supply catchment is 5,000 hectares over 30 years. This level of planting would sustainably provide sufficient volumes of timber to justify investment in a processing operation. Surplus timber would go to additional markets which may develop, or for export.

Table 1: level of annual planting needed over 30 years to create a catchment forest resource  to sustainably supply small and medium processing operations.










Employment created by a regional hardwood industry based on a small-scale processing operation

  • Forest establishment and management:   3-10 full time employees (FTEs)
  • Forest harvesting - one crew:                       9-10 FTEs
  • Sawmilling:                                                         54  FTEs
  • Remanufacturing:                                           131  FTEs

Further employment would be created in, for example, transport, administration, and support services.


Overall economic contribution of one regional hardwood industry

  • Overall GDP contribution from one small regional hardwood industry ~ $82.5 million per annum.
  • Return on capital employed ~25%.

*Assessment of afforestation and future wood processing opportunity with non-radiata species - Wairoa District, Peter Hall, Scion, 2020.

Growers outside target catchments

Landowners growing durable eucalypts outside the main catchments will have the option of either transporting logs further for processing or utilising what we envisage will be an up-skilled mobile sawmilling sector to process harvested trees. Processed timber could then be used on-farm, sold to other local landowners e.g. for fencing and outdoor construction, or transported to higher-value markets.

NZDFI is working to develop the NZ small-scale sawmilling sector.