Tasmania's forest peace talks are at the risk of collapsing after the Thursday walkout of a second forestry group, the Australian Forest Products Association (AFPA).

With the walkout, AFPA joins the Forest Industries Association of Tasmania (FIAT) abandoning negotiations that aim to end the 30-year conflict over the management of production forest. FIAT walked out of the talks on Wednesday.

The walkout was caused by the refusal by the Tasmanian government to guarantee Forestry Tasmania in favour of the creation of a new independent statutory authority. The two groups fear creation of a new agency would expose the forestry industry to political maneouvering.

"We are disappointed that the opportunity to resolve the decades-long dispute over forestry in Tasmania is being threatened by this unnecessary proposal, and we urge the government to reconsider its position in the full context of the outcomes all parties are seeking to achieve through the forest agreement process," AFPA Chief Executive David Pollard said in a statement.

"Forestry Tasmania (is) fairly well acclaimed around Australia and indeed around the world as one of the best forest managers . . . it seems ludicrous to us to remove from them the management control of the production forest estate. I don't see any reason to create a new body," The Mercury quoted FIAT Chief Executive Terry Edwards.

The peace talks, which had been going on for over two years, would unlock $100 million in federal funding if the parties involved could reach an agreement. The deadline for a deal has been extended several times and looks like would need another extension due to the walkout.

Jane Calvert of the Forestry Union said the peace talks will continue even if the two industry groups have walked out of negotiations.