Creosote shortage hurts Border Timbers

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Border Timbers Limited, a forestry and sawmilling company, is exploring avenues of sourcing a critical chemical in production, creosote, overseas due to a severe shortage in the Southern and East Africa regions.

The shortage has temporarily affected production throughout the Mutare-based firm’s pole yard site.

In a statement accompanying its financial statement Border Timbers said it expected return to profitability in the next financial year after the company posted a loss of $245 000 for the year ended June 30, 2011.

“The Southern and East African regions are facing severe shortage of creosote and efforts are being made to secure supplies from overseas,” the company said.

It said power outages at Border Timbers International, a division of the group, impacted negatively on production output.

“Machine breakdowns have been on the increase due to the state of the plant. The benefits of the new equipment and the power supply agreement should see the company return to profitability in the coming financial year,” he said.

Border Timbers Limited installed diesel generators in the period under review resulting in increased power generation, but it was insufficient to run the entire plant hence the impact of load-shedding by Zesa.

The company signed a power supply agreement with the Zimbabwe Electricity Transmission Distribution Company in the second half of the year.

In the period under review revenue rose to $21,9 million from $13,8 million same period last year due to increase in output.

“Plantation development remained an area of major focus with silvicultural targets being met. It is pleasing to note that the silvicultural backlog for some of the group’s estates has been cleared and on the whole it is envisaged that the remaining backlog would be cleared by June 2013,” reads part of the statement.

“Total round wood production increased increased by 40% from prior year on the back of capital expenditure on harvesting and roads equipment.”

Capital expenditure for the group stood at $4,1million with $2 million being channelled towards plantation development and the balance going to plant and equipment.

The company lost 193 hectares of planted area due to fires related to arson and the damage to the area is greater than that caused by land reform.