WOOD supply cutbacks because of Leadbeater’s Possum protection measures, which decimated supply to a Heyfield sawmill, plunged VicForests into the red in 2016-17, according to the company’s annual report. The company’s result after tax was a loss of $3.2 million because of a $6.9 million decrease in the accounting valuation of the area of state forest available for timber harvesting. Profit from operations before tax was $1.5 million. VicForest chief executive Nathan Trushell said it was a good result, considering the operational challenges they had faced. The loss was the outcome of more forest being placed in reserves, and not a reduction in demand for timber. “Due to an increase in conservation efforts, areas previously available to us have been excluded from timber harvesting over the past year,” Mr Trushell said.