Valued by the UK’s Office of National Statistics at over £8.5 billion, the forestry and timber products industry comes 18th in the list of over 120 major industries in the UK.

This is an industry which touches everyone’s life – from the responsible harvesting of timber, downstream to sawmill, wood processor, manufacturer to the distributor, merchant, joiner or retail outlet, the timber supply chain comprises a vast number of operations.

Many of these require equipment adept at handling heavy, often irregular loads in tough environments – and most of this equipment is diesel powered.

Some of the major manufacturers in this space include Hubtex, Bulmor Lancer, Combilift and Manitou, and one of the major challenges facing them and others are the EU emissions standards for non-road diesel engines – and the potential costs that could result.

Emissions Reduction
Since the introduction of the first standards, known as Stage I, back in 1996, the regulations have become steadily more onerous for manufacturers. The new standards – Euro-Stage IIIB for all diesel engines over 37kW and Stage IV for over 55kW – require Nitrogen Oxides (NOx) Hydrocarbons (HC) and Particulate Matter (soot) exhaust emissions in new engines to be reduced by an enormous 90% compared to the Stage III standards they replace. Engines are also required to use Ultra Low Sulphur Diesel.

These standards bring EU emissions legislation into line with the latest US regulation (Tier 4) to reflect the global nature of non-road products.

The harmonisation of emission regulations spreads the cost of developing new products over the largest possible geographical market, assisting with high development costs in a market with relatively low production volumes.

Because engine manufacturers have a two year period during which they can still supply engines produced prior to the legislation date, there are still plenty of compliant trucks on the market, but eventually the compliant equipment will be all that is available.

Buy or contract hire?
Staying with costs, the choice between buying trucks and other equipment outright, or looking at the various contract hire/ leasing options available, from companies like Investec, is another issue that operators have to consider.

Such options usually offer fixed monthly payments, which have the advantage of simple budgeting without unexpected surprises. These deals are also tax efficient, as each rental payment made within the financial year can be offset against company tax liability.

Also, as contract hire is a service, VAT is payable ‘as you go’, not as a single lump sum, as usually applies to cash or lease purchase deals. However, of course, you never actually own your vehicles.

Contract hire and leasing options are increasingly popular and have also worked their way through to the world of private family car, but they are not the answer for everyone and need to be looked at carefully.

No train no gain
It is understandable that in recent years companies have been focused on keeping their heads above water so training and recruitment has been low on the agenda.

But as the recovery strengthens problems associated with an ageing workforce are now beginning to emerge in the materials handling sector, where the skills loss caused by retirement is beginning to bite, with potentially far-reaching implications.

Technological advances in forklift truck design and the development of advanced warehouse storage and retrieval systems, also require engineers to gain new skills.

To address this, trade bodies the British Industrial Truck Association (BITA) and the Fork Lift Truck Association (FTLA) have come together to create a single apprenticeship scheme covering the whole UK to bring more young people into the growing materials handling industry, including timber trades.

For those already in the industry but who need to update their skills, the RTITB offers a wide range of courses and at IMHX 2016 they will again host the Operator of the Year regional heats.

The pressure of meeting new emissions targets, decisions on buying or leasing, and the need to train a new generation of materials handlers and logisticians – and upskill those already in the industry, certainly means plenty of challenges for the timber trade, in 2015 and beyond.