'Making wood work'

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Wood manufacturing companies cannot compete with energy companies subsidised by the renewables obligation, says Anne McGuire MP.

What is the 'Make Wood Work'campaign, and why have you chosen to support it?

I am chairman of the wood panel industry all-party parliamentary group, and the 'Make Wood Work' campaign is part of that. It is linked very much to highlighting the importance of the wood panel sector as an employer, and as a manufacturing element of our industry. It is also highlighting the fact that we have an enormous amount of wood which can be used for other things than going into biomass.

How important is the timber industry to the UK economy?

If you just use my constituency of Stirling in Scotland as an example, there the Norbord plant provides around 250 jobs. That company also provides 125 jobs in Inverness and another 500 in Devon.

These jobs are all in rural communities, so they are significant employers. Other elements of the industry such as saw mills also provide vital employment.

The industry is now the biggest recycler of wood in the country, and it also provides significant numbers of jobs in areas where jobs are at a premium.

How are biomass subsidies negatively affecting the wood panel and timber packaging industries?

The renewables obligation is actually distorting the market, partly because energy companies are looking at using domestic wood. They also have much greater purchasing power, partly because they get a subsidy for using biomass. This is something we have been highlighting to government over the last few months.

Ultimately this constant usage of domestic wood, which could be used for other things and recycled into other products, is having a direct impact on the market.

Is it the fact that they are using new wood, as opposed to wood at the end of the cycle?

It's not just about using new wood, it is about using wood that is in the system which can still be recycled and used for other things. Norbord do not use new wood, it's a fascinating process; they bring in wood that you wouldn't think they would be able to do anything with, and they convert it by various processes into wood panels which is used to build with – floorboards, etc.

It is not wood that is at the end of its lifecycle; it is wood that can still be used for other things.

If nothing is done about this, what are the consequences for the wood manufacturing sector?

Effectively the wood manufacturing sector is going to, I think, face major difficulties, because they cannot compete, it is not an even playing field.

They are buying in the same market as the energy companies, who are being subsidised to buy in the market, thus the price is being pushed through the ceiling.

The distortion will lead to the displacement of the wood panel sector, which can only afford to buy UK wood, because imported wood is far too expensive.

The problem we have at the moment is that the Department of Energy and Climate Change (DECC) is not accepting that there is a real problem here. Our question to DECC is, why would the energy companies overlook domestic wood when it is around half the price of distorted wood?

How are you seeking to ensure this campaign achieves its aims?

We have had an EDM, a Westminster Hall debate and now two meetings with the minister, Charles Hendry.

We are trying to come to a shared understanding about how difficult the situation is. We are awaiting the outcome of our latest meeting, but we are intent on continuing with the campaign.

I think what the industry will do is encourage the people who supply them and the people who use those wood products to see this as something they can embrace as a campaign.

Anne McGuire has tabled EMD 1788, entitled 'Make Wood Work Campaign'.

The Timber Packaging & Pallet Confederation (TIMCON) represents the interests of the wooden pallet and packaging industry in the UK, on the basis that is timber is:

- The most environmentally friendly and sustainable material – decreasing your carbon footprint
- The easiest material to recycle or repair
- A major employer in the UK – representing up to 38,000 jobs

TIMCON is lobbying the government to recognise the importance of timber as a raw material in its policymaking.