The federal government will provide a $15.1 million freight subsidy to companies transporting logs off Kangaroo Island.
The $15.1 million federal package will provide assistance to freight logs salvaged from bushfire-affected plantations on Kangaroo Island to get to the South Australian mainland and then to mainland sawmills with immediate capacity to process structural timber.
Minister for primary industries and regional development, David Basham said the state government had pledged up to $3 million to bring additional timber to the local housing industry and welcomed the federal government's new support package.
"This will be a game changer for South Australia's housing construction industry and will significantly increase the amount of structural timber currently available," Mr Basham said.
"The South Australian Government is ready to be the first state to sign up to accept the Commonwealth package. The booming local housing industry has been great news for our economy but the increased demand for timber has put real pressure on our supply chains.
"This transport subsidy will maximise the amount of sawmill quality log available to local processors which will boost supply and support local jobs in our regions and across metropolitan Adelaide.
"The community now needs Kangaroo Island Plantation Timbers to open up access to its bushfire affected pine plantations for harvesting and allow local sawmills to get busy."
Federal minister for agriculture and northern Australia, David Littleproud said the government had listened to industry's concerns to keep product moving.
"This will provide vital assistance to businesses impacted by increased demand, global supply chain delays due to COVID-19, and the lasting impacts of the 2019-20 Black Summer bushfires," Mr Littleproud said.
"It expands our successful $15 million Forestry Salvage Transport Measure, to allow for both intrastate and interstate transport of remaining bushfire-salvaged construction grade softwood to mills in any state with capacity to process it."
South Australian Independent Senator Rex Patrick welcomed the federal government funding.
"This is the result of months of work, lobbying, negotiating and collaborating between state and federal governments, the Australian Forestry Products Association, sawmills and myself," Mr Patrick said.
"Finally there's a means to get KI timber to the saw-mills, so it can be processed and used to address severe market shortages for Australians trying to build or upgrade their homes."
The Australian Forest Products Association (AFPA) and South Australian Forest Products Association (SAFPA) also welcomed the funding subsidy to the company.
"This is one critical barrier removed and SAFPA will continue to work with the state government to remove other blockages mainly around the short, medium and long-term transport options to ensure the volume of log can be moved to the mainland with the least disruption to the community and in the shortest time possible," SAFPA CEO Nathan Paine said.