Forestry
The Argyll and the Islands area represents 20 per cent of Scotland's managed forest land and produced almost 700,000 tonnes of wood in 2003. The Forestry Commission predicts that this production level will double by 2015.
The bulk of this wood is softwood spruce and fir which grow well in our climate. The valuble part of the trees are the main trunk or saw logs, as they are called, with the small round wood (thinnings, tops and branches) having a lesser commercial value. This is due to the low prices paid for this type of wood compared to the cost of transporting it to the necessary markets. Trees from the forest end up as timber to be used in the contruction industry or sent to the board manufacturers and to the paper making industry.
This tranportation is largely carried out by road hauliers most of whom are based in Argyll and, to a limited extent, by sea. This has been problematic for the local authority, Argyll and Bute Council, as more and more tonnage is carried on the areas road network with the subsequent damage and maintenance affecting the authoritiy's budget. The answer, in part, was the creation of timber transport routes within the forest itself which grew out of the Argyll Timber Transport Forum which HIE Argyll and the Islands, along with the local authority and the Forest Commission, funded to look into this problem.
Only 100,000 tonnes left by ship from Argyll ports last year even though this is probably the most cost effective transport method but requires that the trees be harvested close to the point of shipping to cut down the costs for double handling, i.e. from forest site by road and then onto a ship. The only way to make this more cost effective is to use larger ships and/or containerise the logs. This strategy would require more deep water ports to handle the increased draft of larger vessels and the development of better pier facilities for handling timber. Argyll and the Islands Enterprise is looking into both these options as well as possible rail routes out of Argyll. One suggestion has been to use barges to bring timber from the islands and coastal regions on the West Coast to Ardrishaig via the Crinan Canal or to Barcaldine in North Argyll then have it shipped out by larger vessels. This would avoid the double cost of road and ferry transport costs on these routes.
Argyll and the Islands has one of the largest forest areas in Scotland and, while some local businesses reap the benefit of this resource being on their doorstep, the majority play no part in this £557 million industry. This is due to the fact that most of the processing of the raw wood takes place outside Argyll.
The Scottish market revolves around the softwood varieties with only a niche market in hardwoods. Most of the softwood trees grown are Sitka spruce (70 per cent) with the rest being a mixture Scots pine and Douglas fir. This timber is transported to sawmills in Fort William, Dunbartonshire, Ayrshire and, over the last couple of years, to Northern Ireland and Eire.
The long fibrous nature of the Sitka spruce makes it ideal for paper manufacture and many of the larger Scandinavian companies specialising in these products are now based in Scotland to take advantage of this abundant cheap resource.
This smaller roundwood goes to paper companies such as the Irvine-based Caledonian Paper, part of the Finnish company UPM Kymmene, where it is turned into lightweight coated paper for magazines, brochures and catalogues. This plant employs 360 people and the annual production capacity of the Irvine plant is 270,000 tonnes.
Further significant quantities of Argyll timber also go to a Cumbrian company, Iggesund Paperboard Ltd, shipped by boat from Ardrishaig and Campbeltown to their mill in Workington on the English coast where it is transformed into paperboard for use in food cartons, packets and packaging. The mill employs 500 people and produces 235,000 tonnes of paperboard per annum.
Another recent trend that could aid the forestry industry is the emerging wood fuel Biomass market. This increases productivity and profitability by utilising much more of the felled timber with the cheaper material, such as brash and small round wood, being transformed into a more sellable fuel product. Argyll has seen the rise of a number of wood boiler district heating systems along with the same technology being used to heat community swimming pools in Lochgilphead and Campbeltown. AIE and the Forestry Commission are involved in assisting the establishment of wood fuel supply chains and have been successful in helping two companies start up in the area as wood chip suppliers. We are currently involved with two other potential suppliers in Oban and on Mull.
In Austria, Scandinavia and in North America wood fuel has become a vital part of forestry economics being supplied in vast quantities from their indigenous forests into local markets in both wood chip and pellets formats. We believe that Argyll could benefit in a similar fashion to these other areas and are working with the industry towards that goal.