The ACCC will not oppose OneFortyOne Plantations’ proposed acquisition of the Jubilee Highway Sawmill in Mount Gambier from the Carter Holt Harvey Group, which includes the associated woodchip export operations at Portland.
The Jubilee Sawmill is the largest structural sawmill in the Green Triangle region, which is an area of approximately 6 million hectares on the border between South Australia and south west Victoria with significant softwood plantations. OneFortyOne is the largest softwood (radiata pine) forest plantation grower in the Green Triangle region and does not currently own any sawmills.
“The ACCC contacted many market participants and took into consideration information from a large range of sources,” ACCC Commissioner Roger Featherston said.
“Although concerns were expressed by industry participants about the proposed transaction, we concluded that it would be unlikely to substantially lessen competition.”
“We considered each level of the supply chain, the size of sawlogs acquired by various sawmills in the region and the availability of alternative sources of supply for some customers,” Mr Featherston said.
“The ACCC focussed on whether the increased vertical integration that arises from the proposed acquisition would lead to foreclosure of competitors, and therefore a reduction in competition. However, our review found that OneFortyOne would continue to have incentives to supply sawlogs to other sawmills and to acquire woodchips.”
Background
Sawlogs are used to produce structural and non-structural timber products. Structural timber products are used in construction, including timber framing for residential housing. Non-structural timber products are used in packaging and landscaping. Sawmill woodchips are used to manufacture particleboard and are also exported overseas to make paper.
OneFortyOne Plantations was established in 2012 to invest in plantations and other timber operations in Australia. In October 2012, the company acquired the harvesting rights of the Green Triangle plantation estate from the South Australian Government. The company is owned by Australian and international superannuation or pension funds.
Carter Holt Harvey manufactures and distributes sawn timber and other products from timber processing sites across Australia.
The Green Triangle Region is a major radiata pine (‘softwood’) forest growing region on the border area between south east South Australia and south west Victoria.