ForestOne's Benalla Operations Scale Back: Job Losses Loom

Benalla, Victoria – ForestOne, a significant player in the timber industry, has announced the partial closure of its manufacturing operations at its Benalla site, raising concerns about potential job losses in the local community. The company will cease operations at its dry sawmill and particleboard manufacturing facilities, although it plans to maintain its green sawmill and lamination line. The exact number of jobs affected remains uncertain, with the company describing the figures as "confidential" while local reports suggest as many as 140 positions could be lost.

The decision has left many residents apprehensive about the economic impact on the community, which heavily relies on ForestOne as a major employer. Local business owners, including bakery manager Andrew Bertallis and butcher Paul Rettke, voiced their concerns regarding the ripple effects the closure may have on the broader economy. Bertallis emphasized, "It is huge dollars out of the community each week," while Rettke noted, "Family people with mortgages with kids to feed" will be significantly affected by job losses in the area.

Ian Fankhanel, Managing Director of ForestOne, cited escalating manufacturing costs, weak market conditions, and external compliance pressures as primary reasons for the operational cutbacks. He stated, "We continue to face weak market conditions and, unfortunately, the outlook is still very poor. 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." Fankhanel further indicated that 80% of the products produced in Benalla are sold within Victoria, a state currently facing the most challenging market conditions in the country.

The Victorian Forest Products Association's Chief Executive, Andrew White, added that the local timber industry is struggling due to a depressed housing market, which has delayed construction timelines significantly. He remarked, "Build times for houses have blown out from around six months to 10 months, affecting suppliers like ForestOne."

On the political front, Annabelle Cleeland, the Nationals Member for Euroa, expressed heartbreak over the news, especially during a cost-of-living crisis. Cleeland stated, "It is just heartbreaking what we are hearing... of so many jobs being made redundant and axed during a cost-of-living crisis." She has committed to raising the issue of support for regional businesses in parliament.

In light of the situation, a spokesperson for the Victorian government acknowledged the difficulties faced by workers and their families and indicated that Regional Development Victoria is collaborating with ForestOne, the Benalla Rural City Council, and Workforce Australia to facilitate support for affected workers. The spokesperson noted, "We continue to support businesses across Victoria. We have cut or abolished taxes 65 times and are continuing to remove the red tape that holds many businesses back."

As ForestOne restructures its operations amid these challenges, the future of the Benalla manufacturing site remains uncertain. The company expressed hope for a rebound in demand, which could allow for the resumption of full operations in the future. However, the current economic climate and uncertainties in the housing market cast a shadow over these aspirations, leaving many in the community anxious about their livelihoods and the economic health of Benalla.

The unfolding situation at ForestOne not only underscores the challenges faced by the timber industry in Victoria but also highlights the broader implications for regional economies that depend on manufacturing and local employment. As the community awaits further developments, the focus remains on finding solutions to support both the business and its workforce during this tumultuous period.