HYETT, Mr Richard, Acting Chief Executive Officer and Director of Policy, Australian Forest Products Association LESTER, Mr Tim, Policy Manager, Australian Forest Products Association MATTHEW, Mr Gavin, Chief Executive Officer, Engineered Wood Products Association of Australasia Committee met at 16:18 CHAIR ( Senator Collins ): I declare open this hearing of the Senate Foreign Affairs, Defence and Trade References Committee's inquiry into the effectiveness of sanctions against the Russian Federation. These are public proceedings being videostreamed live via the parliament's website, and a Hansard transcript is being made. I remind all witnesses that, in giving evidence to a committee, they are protected by parliamentary privilege. It is unlawful for anyone to threaten or disadvantage a witness on account of evidence given to a committee, and such action may be treated by the Senate as a contempt. It is also a contempt to give false or misleading evidence. Witnesses also have a right to request to be heard in camera. I now welcome representatives from the Australian Forest Products Association and the Engineered Wood Products Association of Australasia. I understand that information on parliamentary privilege and the protection of witnesses giving evidence to Senate committees has been provided to you. Would anybody like to make a short opening statement today? Mr Hyett : Yes, I have an opening statement. I will provide a condensed version now and then give the full one to the members. CHAIR: Thank you very much. Mr Hyett : Australia has become the dumping ground for conflict timber because our laws and compliance framework aren't strong enough, putting Australia's sixth-largest manufacturing sector at risk. The Australian government imposed 35 per cent tariffs on timber from Russia in response to the war in Ukraine. When sanctions were introduced, overnight, we saw a swap in volumes from Russia to neighbouring countries just across the border, such as China and Lithuania. For China, for example, much of this contained larch, which is not grown in China and most likely from Russia. Russia has a fifth of the world's forests. Our testing has shown there is Russian timber in product from China. Timber is either incorrectly labelled or processed to become engineered wood, LVL, plywood and furniture and avoids the 35 per cent tariffs. On average, we rely on imports to fill around 20 per cent of the market. However, during COVID, we found we couldn't rely on imports to fill the gap in the market, and this will increasingly become the case as world-demand peaks are more often aligning. Our domestic sovereign capacity protects Australians against fluctuations in the international market. The effect of price supply provides materials for building homes and provides secure, stable, sustainable and quality jobs in regional areas. Large surges in imports lead to job losses and mill closures in Australia, and history has shown that, when mills close, they are unlikely to reopen, reducing our sovereign capability. Currently, the market is at the bottom of the demand cycle. Australian manufacturers' yards are full, ready to build Australian houses. Despite this, Australian manufacturers continue to lose market share to imports that are selling product for lower than the cost of production in Australia. As other countries have implemented regulatory approaches to restrict the presence of Russian timber, Australia has become a more and more attractive destination market, as we have not put these laws in place. There is also a question on due diligence systems, which rest on third-party certification, particularly as importers may not have the resources or the capacity to conduct their own supply chain investigations. Both of the major certification bodies have explicit policies in place to ban product containing Russian material; however, Source Certain's report commissioned by the Department of Agriculture, Fisheries and Forestry showed that half of all imported product assessed had failed claims of provenance or taxonomy. All domestic product was accurately labelled. AFPA recently visited Sydney Build, where many Chinese importers had brochures promoting larch products and claiming certification despite those bodies banning Russian timber. If claims around certification are unreliable, this also brings into question whether other declarations can be trusted, on biosecurity, compliance to performance standards, production and labour arrangements, treatments, chemical exposure and illegal logging. Who is checking? What you will hear a lot when you talk to government agencies is, 'That's not our job.' Whose job is it, and where and how often do they check? Declared LVL imports totalled 205,000 cubic metres last year to October 2025, up 63 per cent on the previous year and more than double what they were since the war in Ukraine started. The vast majority of this is from China. There is an increasing amount of timber being purchased and shipped directly from these Chinese mills. Use of LVL, a structural timber, directly displaces timber from our domestic mills. There is no doubt that builders are also under pressure. I understand building is expensive and we all look for cheaper options. But Australians do not want to fund the war in Ukraine, and they do not want Australian manufacturers to go out of business or Australian jobs to be lost because of shady operations using Russian timber. Thank you. CHAIR: Would you like to make an opening statement too, Mr Matthew? Mr Matthew: Certainly. It'll be a bit shorter and a bit more concise, but what it will do is support AFPA's submission. EWPAA is industry's technical association for manufacturers of engineered wood products, particularly solid-timber plywood, laminated-veneer lumber, glue-laminated timber, cross-laminated timber, particle board and medium-density fibreboard. Australia's timber manufacturing industry is hurting. Mills are closing, not to reopen. Regional jobs are being lost. This issue is one of the reasons. Tariffs do work, but these sanctions have not worked due to circumvention by third-party countries importing timber products made from conflict timber, allowing these funds to flow back to Russia. EWPAA is an associate member of the Australian Forest Products Association and supports their submission, including urging the government to extend tariffs to all imported timber products containing Russian fibre, initiate antidumping actions where predatory pricing is identified and increase Australian border compliance activity with a risk based approach. I want to highlight two further points. This is a broader issue than just solid timber and LVL. Wood-fibre panels, finished joinery and value-added boards are other suspect imported timber products. Recent technological advances have made species and origin identification more accurate and more cost effective across more transformed timber products. Our sector is well placed to support Australia's climate change and housing challenges, but only if our trade and border controls support a level playing field. Thanks. CHAIR: Thank you. Senator McDonald, you have the call. Senator McDONALD: Thank you very much, Chair. Good afternoon. Thank you all for your time this afternoon. If I could start with you, Mr Hyett, I want to talk to you specifically about what you've raised around Russian timber laundering—that's what I'm calling it. What does it look like when it's coming through China? How does the product enter Australia and avoid the 35 per cent tariff? Mr Hyett : For us, the most obvious pathway is—it's not illegal to transform a product in China and then bring it into Australia. So, if you take some Russian fibre, you cut it up and you glue it back together into LVL, it can avoid the 35 per cent tariff and come to Australia. There are concerns that timber is being mislabelled and so forth, but this can be done completely legally. We're not getting timber coming direct and paying the sanctions; this is a way for them to circumvent that. It's clearly not giving effect to the purpose of why the sanctions were put in place. Senator McDONALD: No, clearly not. The department's own testing found that 50 per cent of sampled imported timber product couldn't verify provenance. Does that reflect what your members are seeing on the ground? Mr Hyett : Definitely, yes. We're definitely seeing it, and our testing has also shown that there is Russian fibre in the LVL product. Senator McDONALD: You noted that importers were openly offering what appeared to be Russian-origin larch at Sydney Build in April. How widespread is that kind of activity? Mr Hyett : It seemed very widespread. There were numerous—probably in the order of 30—LVL producers from China. Every couple of booths there'd be more production. Some of them had brochures which outlined that they contained larch. But, more disturbingly for me, this piece of timber, for example, came from a business that was offering it without any brochure, without any documentation. They just wanted your email address and they could contact you and provide timber to you. Nobody knows what's in that timber. There was no nothing to check, and nobody is checking. Senator McDONALD: You mentioned in your submission that you understand building is expensive and Australians are looking for cheaper costs, but I think Australians would be absolutely horrified if they knew about this lack of enforcement of imported products coming in this way—from Russia, I mean. Mr Hyett : Yes. Gav might be able to comment on the compliance, because compliance—as I say, one of the things that we've noticed is, increasingly, LVL mills in China are going direct to the builder and then there's nobody checking that. The builders are probably not well placed to do that compliance checking. It's really concerning that that nobody is checking, not only the provenance but whether the glue works or whether it's got formaldehyde levels which meet Australian standards. Nobody is checking. Senator McDONALD: That's outrageous. Mr Matthew : Can I please add something to that? We should understand that the actual building product cost is quite small, especially for those types of single detached homes with timber frames. It's quite small compared to the rest of the cost and the cost of trades et cetera. I think you're right in that people would look at that and say, 'Well, there's a small saving on a product, but we've got an issue around conflict timber,' and they would make the right decision. I just wanted to put it in context. Having a small saving there is not a big saving for the cost of a house. It's quite small in that way. In terms of compliance, there is no origin labelling compliance regulation, basically. If you produce to a product standard, you do have to brand it. But, at the moment, the origin is not one of those things that needs to be branded on that product. Mr Hyett : In a house that might be worth $500,000 to $1 million, you might be saving in the order of hundreds of dollars by going to this cheaper Chinese product. While it's expensive, we're losing Australian businesses for a matter of hundreds of dollars. Senator McDONALD: With no guarantee of, as you say, whether or not it meets Australian standards for formaldehyde levels. We have standards for a good reason, don't we? Mr Hyett : Yes. Senator McDONALD: Mr Matthew, what's the impact been on Australian industry jobs and stock levels and pricing? Mr Matthew : Firstly, can I reflect on the first question you asked? Import data's easily available, and where it comes from is easily available as well. As soon as the tariff was put in, we saw that everything that was imported—timber imports from Russia and Belarus—basically went to zero straightaway. It was a red flag for us and should have been a red flag for government as well. That's the first thing. This is not all imports. We're not saying that, and I'm not saying that. It is a small proportion, but the problem with this small proportion in a commodity market is that, if that price is lower, that price defines the price. Price impacts even a small volume of this material, and, over the last year and a half to two years, it's become quite a large volume of material and has had some major impacts on business. The broader market is that we want to be building more houses; we know that. This product is coming in. Mills want to produce. Most of the big sawmills are only at about 80 per cent capacity. At the moment, the yards are filling up. There's been some rationalisation already. A couple of mills have closed, likely never to reopen. Regional jobs have been lost. There's a price and profitability issue. There's also a business issue of closure. In industry, we feel that this is a moment in time when we really need to focus in on this issue. There are other issues, but we're talking about Russian timber today. This is an important issue to get right. Senator McDONALD: I think it's devastating to think of the communities. The world's most renewable product is timber, yet we're discovering that the Australian industry and Australian jobs are being abandoned in favour of products from other places that don't have our high standards, whether they be building codes or environmental standards or workforce standards. I am horrified. What actions, then, are you calling on the government to take? What's the solution? Mr Hyett : We've asked for four things. We'd like to extend the 35 per cent tariff on Russian products to all products containing Russian materials, irrespective of where they're imported from. We'd like to undertake antidumping actions against products containing Russian materials, as they've done in the EU. We'd like to undertake proactive compliance activity to stop Russian timber products being rerouted through other countries and imported into Australia. And we'd like to see introduced country-of-origin labelling requirements for timber so that consumers can make an informed choice regarding what they are purchasing. Senator McDONALD: Will the government have the capacity? I understand the antidumping provisions; there's the commissioner for antidumping and a group stood up to do that work. What about the ability to test and ensure that there is some sort of compliance in understanding what is Russian timber coming through the back door? Has the government got the capacity to do that? Mr Hyett : The government did some testing as part of a pilot in relation to illegal logging, which is in the report that we referred to earlier, but they don't have a system in place to have that ongoing testing, which is a real concern for us because importers know that there is nobody checking. Senator McDONALD: It's a joke, then, isn't it? There is a complete lack of protection for Australian jobs and Australian industry, I would suggest. Wood Central suggested in their submission that, as Europe tightens up, Australia risks becoming the destination market for Russian timber rerouted through third countries. Is that reasonable? Mr Hyett : Chinese businesses have learnt—when the EU introduced sanctions on product going from China to the EU, the mills put a thin layer of softwood on the outside of the product so it would be reclassified, to get around the tariffs, which meant the EU had to introduce further dumping action to stop that as well. They are very quick and agile, and it's very difficult for those frameworks to keep up with that. Senator McDONALD: So has Australia just become a soft target, given that the EU and the US and others have tightened up their approach? Mr Hyett : Absolutely. Mr Lester : If I may add at this point, it's worth understanding that our illegal logging laws are actually very extensive; what they do not cover is conflict timber. That means that, as Mr Hyett mentioned at the start, it's not illegal for Chinese businesses to buy Russian logs. It's not illegal for them, within our system, to take those logs and transform them, and then, under the WTO rules—under country of origin—that becomes a Chinese product in terms of trading regimes, so the tariff does not apply. There is actually nothing illegal about that. Within the Illegal Logging Prohibition Act, due diligence on importers means that they should actually be capturing, as much as they can, information about where the tree was grown and harvested, so all of that information should be captured within our system. What we don't have is coverage of conflict timber, so we then rely on third-party certification, which, unfortunately, the Source Certain report shows can be unreliable in this space, for a number of reasons. That is also an area of potential inquiry. I'd also note that that Source Certain report was not voluntarily made available from the government—it was actually released under FOI—and nothing has happened in response to it either since we've had it. So we're seeing multiple problems at multiple stages. There are different ways—and you've seen this in the submissions—this may be tackled, but, fundamentally, at this stage, there is a problem no-one's checking: we don't actually know how much is Russian. We can tell that it's there, because our testing has shown it. It's still not illegal. Senator McDONALD: To go back to you, Mr Matthew, it's not just that it's conflict timber; we're now talking about the potential for products that would fail Australian standards. Is it a safety issue as well? Could non-conforming engineered products result in a problem for Australian families? Mr Matthew : There is overlap between the issues. If you don't have product information, if you don't have monitoring and testing and checking, then there's the conflict timber issue but there's also a potential issue around that product not conforming to the standards it claims it was manufactured to. This is not everything—it's a small amount of suspect products—but it's still a problem. It's a problem if those products get put into applications that are higher risk—that bear more load or are at the bottom of a three- to five-storey building et cetera. I was going to follow up that conversation, or debate, by saying that we need more technical information on products and we need it on this side of the border as well—either at the border or at the point of sale—and available to builders and certifiers and a whole bunch of different people that ask the right questions. We need testing, monitoring and enforcement for high risk. You don't have to test everything. We do it with biosecurity and we do it with other types of issues. Let's have a program like that. Those two things, together with the obligation to put on the origin labelling, will form a better situation. I'd even add in a bit more education around consumers and builders—those kinds of things—to make sure that the whole system works together. Senator McDONALD: You've just lightly touched on load bearing. As a consumer, I would be horrified if I contracted a builder who hadn't been able to ascertain whether the product that I put into my multistorey family home does meet Australian standards because there are not adequate restrictions on imports. It could now risk my insurance, much less my children and my family. Mr Matthew : What we're saying is that we definitely need to tighten that up. One thing, to mitigate that risk, is that we're talking about a product, and a product goes into a building system, so there's redundancy in design and those kinds of things as well. That gives more confidence around the structure, definitely, but it's a concern, and that concern is not a new concern. That's an old concern, and we need to do better in that area. Senator McDONALD: Mr Hyett, I could see that you were wanting to demonstrate— Mr Hyett : This toilet paper is from the bathroom in Parliament House—FSC certified. Do we know that FSC bans Russian fibre? Do we know that it doesn't have Russian fibre in it? Who's checking? Senator McDONALD: Yes. So we could be wiping our bottoms with conflict fibre. That's a shocking thought. Senator CICCONE: Ouch! Mr Matthew : That does sound painful. Senator McDONALD: Do you want to share the call and come back to me? CHAIR: Yes. Senator Ciccone, you have the call. Senator CICCONE: With your first recommendation around the 35 per cent tariff, do you have any examples that you might be able to draw on, for the committee's benefit, of where countries have successfully proved the use of tariffed imports in goods that have been exported by third countries, like what we are discussing at the moment with Russia? Mr Hyett : As I said earlier, the US, the UK and the EU have done a combination of different factors. The EU is the most recent one. They've used the dumping actions to stop that. But for us, the illegal logging laws provide a mechanism for that information to be there so that it's a reasonably simple process to identify products that have Russian fibre or that are supposed to have Russian fibre, so it should be a reasonably simple process for us to put in place. Mr Matthew : The challenge, previously, has been in being able to identify this fibre, especially in more transformed products. But, as I indicated in my opening statement, the technology has improved out of sight. There's more work to be done in that area to make it more cost effective and more applicable across a range of transformed products, but saying that we can't identify it isn't an excuse. Senator CICCONE: It sounds like we can identify it, and it probably is being identified. Clearly, you've brought something in that shows it is probably mixed in that block. But, from your experience, how has timber generally been checked through our customs when it's been imported? Mr Hyett : So, again, for us, the legal logging requires paperwork, and then there is an audit on the paperwork, but that relies on the governance of the country that the product is coming from being— Senator CICCONE: Explain it to me. Timber comes into the country. There is paperwork that's been certified from the said country— Mr Hyett : Yes, that it's supposed to meet the rules from that country. Mr Lester : Under the Illegal Logging Prohibition Act, an importer has to assure themselves through a due diligence process of a range of things, including where the timber came from and all of these processes. They need to have information systems in place that then capture that information. They make a customs declaration that says that this is how they do it. Senator CICCONE: Is this the importer? Mr Lester : That's right. This is the importer. A regular and systematised approach to actually check whether the product that is in the container matches the paperwork is not happening here. The Source Certain report showed us that 50 per cent of imported product they tested did not match its paperwork. Senator CICCONE: How's it generally been described? Are we talking about slabs of timber? Is how it's described up to the importer or the exporter? Mr Lester : Under the act, there's an extensive list of regulated items. I have not been involved in importing timber, so I'm not familiar with that particular process. As I understand it, importers go through and say, 'Well, we're bringing in this timber. It hits this code. It comes from these places. We're making our declaration,' as opposed to its product claims, taxonomy and provenance. Senator CICCONE: If I'm the customs officer, I'm looking at this and saying, 'Well, this matches the paperwork.' What do we need to do to change that? It sounds to me like, ultimately, the importer has a responsibility to make sure that the exporter is telling them honestly what is being sent across our shores. Mr Lester : Again, under the act, it is the importer's responsibility to make sure that they have complied with our laws, because they're the Australian entity around how that works. As we mentioned, for conflict timber, you could legally say, 'This is timber harvested in Russia and processed in China.' That is not illegal, and the tariff will not apply because that is not captured under the Illegal Logging Prohibition Act. Senator CICCONE: How would Australia get support from other nations to extend tariffs to all products that contain Russian material? How would we tackle this? I don't think this is something we can do on our own. I think this has to be a bit of a global effort with countries like those you identified earlier. Mr Hyett : The issue is that other countries have acted, and we've become a target because we're the easiest route. We can join with other countries to make those changes, but our industry will lose a significant amount of skin or employees in businesses in that process. Senator CICCONE: You mentioned earlier that no-one is checking. When you say that no-one is checking, what do you mean by that? Mr Hyett : No-one is checking that the paperwork matches. We did this pilot where 50 per cent of product was non-conforming. But, no, there is no testing program in place, other than the paperwork and an audit of the paperwork. As you know, supply chains are complex. Products come from different places. A product might change hands any number of times before it reaches the mill, then Australia and then the builder. Importers will be busy and builders will be busy. How much time they have to spend checking that paperwork and following it down through all the different parts of the supply chain to ensure that the products are what they say they are is why we think a risk based testing program would really show up the illegal logging and ensure that that we're getting the products that we say we're getting. Mr Lester : The act does understand that Australian businesses may be constrained about how far back up their supply chain they can go. Some of our major importers are, undoubtedly, doing a lot of due diligence work and are able to reach into their supply chains. We're really talking about a segment of the market that is, essentially, buying product from Facebook Marketplace, which, undoubtedly, has a much higher risk, but it does not seem to generate a higher response. Senator CICCONE: This is probably a conversation that involves a bit more time, but, in terms of the whole supply chain, who has a responsibility or a duty to, as you said, make sure the timber needs to be checked? I'm assuming we have to drill a bit and take it away to a laboratory for testing. The builder should also have some responsibility. Other state authorities that implement building codes need to make sure that the timber that is being used by the builder is also up to code and up to standard. Surely, there's a whole chain here. Mr Matthew : The building commissions in each of the states have that enforcement requirement, and that's around compliance not only to the code but also to the standards they manufacture to. I'll be honest, they're under resourced and they don't do a lot of it—they rely on people making reports to do so. The most activity is probably in Queensland through the QBCC. That's their role; it's a state based role. The department will probably tell you later on today that they do a check of paperwork under the legal logging on a risk basis, and they do it for domestic processes as well. What they don't check is the origin, and they don't do those tests we talked about, grabbing a sample and checking what the origin was. There's a framework there, it's just that extension to a testing program. Mr Lester : Your description also demonstrates, in some ways, what the challenge is here. The department of agriculture has responsibility for biosecurity and illegal logging, Border Force has responsibility for Customs, building regulations have responsibility at state level. So, it is a question: who should be checking? Who has that responsibility? Where does it come through? This seems to be an issue that is falling through the cracks—pardon the pun. Where does that responsibility land? Unfortunately, at this stage the outcome could be and is diminished capacity for our timber manufacturing. Senator CICCONE: I guess what you're proposing is a tariff, but I think it's probably a bit more complicated than just slapping a tariff on it. Are there any specific proactive compliance activities that both federal and state governance can look at to assist, other than what we've just mentioned? Mr Hyett : For me, it is a simple risk based testing program at the border which brings in the state organisations—that's the easiest place to capture it, at the border. Then, if you bring in the state regulation through that, it's much easier to be picked up at the border. We think that is the simplest place. The reason we're saying 35 per cent is we're trying to give effect to what the government has put in place. A ban would be great, but the government has shown that we're not getting timber from Russia, because the 35 per cent tariff is having the impact. We're just trying to put in a process that delivers that tariff to where the product is going. Senator CICCONE: We probably need to support our local industry more, as you know. Mr Hyett : Yes, absolutely. Senator CICCONE: You're a big supporter of our local timber industry. CHAIR: I'll pass the call to Senator Cadell. Senator CADELL: One of the things I'm really concerned about is if I'm an engineer and I'm looking at an LVL, a CLT or whatever, I'm going to engineer it with the timbers I know I can get, not conflict timber. If a builder then goes and gets an online timber lot, who warrants that the building and the timber structure is the same as what was done by the engineer if the paperwork is wrong about what's coming in? Mr Matthew : That's a complex area. Certifiers are the bodies— Senator CADELL: They should be checking too? Mr Matthew : They should be checking, but there is an issue around substitution of products from design to what's built in practice. It's a problematic area, but certifiers are the ones that say, 'That was the design, this is how it was built.' Senator CADELL: They tick the box. Mr Hyett : Of course, timber framing is often behind the wall, so it's not so easy to check. Senator CADELL: That's my real concern; things that are structurally built are signed off by engineers. They wouldn't be considering a lot of the larches or birches, because they are conflict timber, are not meant to be here. So we could be having structures built that are not to spec simply because someone went on eBay or Alibaba or something like that rather than going to a local supplier or even getting it from a properly documented foreign source; couldn't we? Mr Hyett : Absolutely. Senator CADELL: Would your 35 per cent tariff be for all woods declared as having Russian components? Mr Hyett : Yes. I represent members that support timber framing for construction, and that's our primary focus. But I certainly know that it impacts across the systems into furniture and other products as well. Mr Matthew : As well as kitchens, flat-pack kitchens, bathrooms, all the cupboards. Senator CADELL: I wasn't here at the beginning. I apologise to my committee members and you. Do you have a value estimation of how much Russian timber is coming in? I know you put it at about $1.5 billion in their industry. Do we have an estimate? Mr Lester : I could take that on notice and get an actual number. Our estimate is around about 100,000 cubic metres potentially including Russian timber. That is around about six per cent of imports. Senator CADELL: With your testing where you found that 50 per cent contained some, does it destroy it? Could the timber be used? Does it only lose a small amount? Was it drilling? How is it taken out? Mr Hyett : That was done by the department. Mr Matthew : You don't have to destroy the whole beam. You can take a smaller sample to do that. Depending on the type of science, you're talking about putting something under the microscope and then putting it into a machine that either does DNA analysis or isotope trace element analysis. The bits don't have to be big compared to structural property testing, where you have to have more of the beam to actually break it in a machine. Senator CADELL: It wouldn't be hard to allocate risk to certain exporters and/or importers, would it? Mr Hyett : No. It should be reasonably straightforward. As I say, we do it in biosecurity. We do it across a lot of our systems. It's a common approach used by government. Senator CADELL: So we're practically saying, 'Just put a greater magnifier on known wrongdoers or new players and let those with good track records have a little less scrutiny.' Is that all we're saying? Mr Hyett : Yes, and, when we're checking, we know we're going to get less noncompliance because people know they can get caught. Senator CADELL: Thank you. CHAIR: Senator McDonald? Senator McDONALD: Going back to this idea of third-country loopholes in timber imports, is it effectively the same problem that the committee is examining with Russian origin but non-Russian-labelled oil refined through third countries? Mr Hyett : The big problem for us is that it's legal to do it. I can't comment on the legality of the Russian oil circumvention. Our biggest problem is that you can legally bring it into the country after it's been chopped up and glued back together in another country and avoid the tariff. Senator McDONALD: Going back to this testing idea—I've just jumped ahead in my mind—testing systems such as World Forest ID and Source Certain are available. Are they mature enough to be used at the border? Mr Hyett : Absolutely. They were used by the government to test that the process works. That has been demonstrated. It does work. Senator McDONALD: So that was the conversation you just had with Senator Cadell about using a randomised testing of high-risk imports. Mr Matthew : It's more difficult if the product is more transformed. Some board products have very small fibres, so it becomes a lot harder to do so. Solid timber LVL is probably the easiest of the lot and then plywood. It's not to say it's not possible to do, but I think there's a piece of work around identifying the best, making them more and more cost effective as well and also applying them to more and more products. Senator McDONALD: It's interesting, isn't it? It started as a sanctions issue in my mind. Now I've got a better understanding—that this is about building safety, manufacturing, Australian jobs and regional jobs, something that's very close to my heart. I'm worried that Australian families are unwittingly buying product that's not fit for purpose that's certainly from a conflict zone, and the Australian government is not providing any sort of framework or assurance that that's not happening. Mr Hyett : Yes, and we've seen it's having an impact. We've already seen one of our businesses reduce from 1,200 to under 1,000 workers in the last couple of years and close two mills. If this continues, it's going to just escalate. Senator McDONALD: That's shocking. Chair, those are my questions, if you need to share the call. CHAIR: Senator Ciccone. Senator CICCONE: Do we know businesses that are importing this type of stuff? Mr Matthew : The type of import channel has changed a little bit over the last year and a half. We're terming it as a bit of a pop-up importer. There are large importers that have got a big footprint in Australia and have really good systems in place, and then lately, over the last two years, there has been an increase in these pop-up importers. We've also said that they work through Facebook—through social media—direct to builders. They're the concerning area. I can guarantee you, if you go on Facebook and ask for LVL, one of these pop-up importers will appear, and you'll get a few more of them too over time. Senator CICCONE: If there is any of that stuff you can give to us, I wouldn't mind looking at it, even if it's confidentially. But I'm intrigued to see who is behind these businesses. Mr Hyett : And I have any number of brochures from the Sydney build that are Chinese importers promoting the use of larch, which is not grown in China, and also claiming FSC certification that has banned Russian fibre. CHAIR: The isotope testing sounds pretty simple, but is it an expensive thing to do? Mr Matthew : Currently it is. It can be. The initial test under a microscope isn't that expensive, but the isotope—it's about new technology and not being a huge market, if you know what I mean. But that's the area where I was thinking there was more work to be done. The good thing about those types of processes is that you could do it a lot more quickly as well, so I can only see the price going down when there is more demand as well. Mr Hyett : You've got 25 layers in a piece of LVL, so that's 25 tests— CHAIR: Wow. Mr Hyett : because that could be 25 different trees. CHAIR: Understood. I appreciate you appearing as witnesses today. I don't believe there were any questions taken on notice, but, if there were, could you please return responses to the committee by Thursday 9 July. Thank you very much..