Mpumalanga Business 2021-22

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OVERVIEW

Forestry and paper PB Bison will spend R560-million at its Mkhondo plant.

Credit: Ludwig Sevenster

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G Bison, a subsidiary of KAP Industrial Holdings, is investing R560-million in a new front-end dryer for its particleboard plant in Mkhondo (Piet Retief ). The company is also building a new medium-density fibreboard (MDF) plant at its Mpumalanga plant, to complement its existing factory at Boksburg in Gauteng. The latter facility will start producing board in 2023. Mpumalanga has the ideal climate and topography for forests. Sabie and Graskop represent the hub of the industry, but commercial forests are also found to the east and south along the Swaziland border. About 11% of the land mass is forested, with 4% of that being natural forest. The province is the national leader in total hectares under forest (514 000ha) and in export earnings. Forestry accounts for about 8% of Mpumalanga’s gross domestic product. The sector comprises logging, saw-milling, wood product and pulp and paper manufacture. Pulp and paper are the main exports, along with sawn lumber, wood chips and wattle extract. Most sawn timber in South Africa is used in the construction sector. Many in the timber industry are advocating for timber to be used much more in construction, arguing that it is a sustainable and renewable resource. The Forest Stewardship Council (FSC) certifies forests to ensure that they are sustainable. The average felled tree is replaced by two saplings and only 6% of South Africa’s current plantation area is harvested in a year.

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SECTOR INSIGHT York Timbers has started growing citrus trees. York Timbers, which has 60 470 hectares of plantation, has planted out 40ha in high-value crops as the first phase of a diversification strategy. The company expects its soft citrus investment to turn to profit by 2024. Sales of lumber suffered b e c a u s e o f t h e Cov i d - 1 9 lockdown and the accompanying slowdown in the construction industry but plywood sales rose and full production was resumed in July 2020. York sells solid wood and products such as doors. Forestry South Africa (FSA) and national government are engaged in a court action about the desirability of switching from