Australia’s forest industries are likely to face some tough times ahead but are well positioned to take advantage of the improving economies of Asia, particularly China, delegates at the ABARE Outlook conference in Canberra heard today.

ABARE’s Manager for Forestry and Land Use, Dr Sinniah Mahendrarajah, said the global financial crisis had led to a fall in the demand for Australian wood products in some of Australia’s key export markets, but things were looking brighter for the future.

“Economic growth in Australia’s key export markets is expected to recover in 2010.

Dwelling approval rates are also on the rise, which suggests strong domestic demand for wood-based products,” Dr Mahendrarajah said.

“However, there are several factors which will influence the forest industry, particularly climate change, developments in domestic and international markets, environmental factors and new technologies.”

The conference also heard that the forest industries’ experience in adapting to changing climatic conditions in Australia.

Dr Michael Battaglia, Deputy Chief of CSIRO Sustainable Ecosystems, said that although the forest industry has been affected by climate change, such as increased temperatures, reduced rainfall and increased carbon dioxide fertilisation, the industry has managed to improve its productivity, reflecting its high capacity to adapt to changes in climate.

“These improvements have been accomplished through improved management practices and site management,” Dr Battaglia said.

Michael Ryan from VicForests discussed the nature of the Victorian forest industry, highlighting the role of forest fires in the state’s ecological system.

“Forest fires are an unwelcomed but natural part of Victoria’s ecology,” Mr Ryan said.

”Salvaging operations in the short term to recover wood from fire affected areas helps reduce the longer term affects of forest fires on the industry.”