Timber company looking to invest in region

WHILE the future of Swaziland’s pulp industry currently remains uncertain, a medium-sized plantation in Haertnersburg, Limpopo, is looking into expansion and investment opportunities in the region.

Stevens Lumber Mills Executive Director Tshepo Malatji said there was a shortage of timber in the Southern African Development Community (SADC) region, especially pine, adding that even though the province produces enough gum trees at the moment, in future these would also be in short supply.

“We’re currently looking at importing timber from Australia, Germany and Chile, which is going to cause a lot of problems,” he said during a tour of the company by a Swazi delegation led by Swaziland High Commissioner to South Africa Muntu Mswane on Tuesday.

“We had huge fires last year and it’s going to take us about 20 years to fully recover. We’re in need of timber and looking into importing from Zimbabwe and Mozambique. We were also looking at Swaziland but after it was also affected by fires, we had to rethink. However, I know of companies in Mpumalanga importing burnt timber from Swaziland.”

Malatji said the company was not only looking at importing raw material, but also at investing in timber plants in other countries. He said, for instance, in Zimbabwe, exporting raw material was not allowed, but companies were expected to value add before exporting.

“So, we’re looking at investing in a plant there. In Mozambique, it’s a bit of a problem because of infrastructure challenges; the roads, electricity and other problems are a challenge,” he added. “In Swaziland, it’s a different issue altogether; there are areas there that need to be exploited.”

Malatji said the timber market in the SADC region was huge and companies in South Africa would have to import a lot from outside that country, adding that they dealt mainly in hardwood (gum trees) and softwood (pine).

He said they were more into value adding; producing to export mainly to Namibia and a bit to Botswana, but mostly sell to Gauteng and Limpopo. 

“This year, we’ve been struggling because of the recession and just breaking even. Before the recession, we were selling very little to individuals, but the local market where people are now building their own houses is increasing, so now we’re actually selling more to individuals than before.”

Possibilities of hiring skilled ex-Sappi workers

SWAZILAND is a possible market for recruitment of skilled labour in the pulp industry, especially with the imminent closure of Sappi Usutu.

Stevens Lumber Mills Executive Director Tshepo Malatji said when it comes to skilled labour, his company looked beyond the borders for recruitment. “There’s a shortage of skilled workers all over the region and I know that in Mpumalanga there are a lot of technicians from Swaziland who are working there.”

Meanwhile, he said the company has a learnership programme where the youth (comprising 60% to 70% of the 607 workers) in the labour force were taken for intense training. He said currently, the company has a E3 million learnership project funded by the government of South Africa.

Company looking to generate electricity

STEVENS Lumber Mills, a medium-sized timber mill in Haertnersburg, Limpopo is exploring possibilities of producing power from its waste.

Executive Director Tshepo Malatji said the company was working with the Trade and Investment Limpopo (TIL) and Energy Fund towards a project to create electricity from its waste products.
He said they were still waiting for a response from Eskom as they needed to agree on certain logistics like, for instance, that whatever reserves the company produces it can sell back to them.
 “We’re also waiting for funding as it’s a black-owned project,” he added.

Meanwhile, to meet demand for increasing shortages of timber, he said black land owners in the Limpopo province were urged to invest in the industry. “We depend a lot on government plantations and small growers,” he said. 

“We’re also promoting black land owners to invest in forestry.”
Stevens Lumber Mills is a family company that’s been operating for around 40 years. It recently sold a 25% shareholding to blacks as part of South Africa’s broad-based Black Economic Empowerment (BEE) programme.

Malatji said out of the 25% shareholding, they decided to reserve 16% for communities -which was unique in the industry — while the 9% was held by the BEE group. He said the 16% was actually meant to get the communities shareholding benefit in the upstream of value adding and not for the company to just benefit from their raw material.

“As a medium-sized mill we’ve got leeway to move around products needed in the market as we’re trying to diversify and most of these are produced from our waste,” he said.

www.observer.org.sz