Forestry Tasmania said on Tuesday that declining global demand for wood products has pulled down its profit for 2010 as it revealed that it incurred an operating loss of up to $8 million the recently concluded financial year, following the $9 million gains it posted in the prior period.

Company chairman Adrian Kloeden admitted that Forestry Tasmania went through challenging and difficult times last year as he stressed that at this time, the company's board and senior management were planning to restructure its business operations in order to prepare for the considerable declines seen in the international markets.

Also, Mr Kloeden attributed the retreats to the debilitating effects of the global financial crisis, which he said was further aggravated "by the closure of the north-west mills and the collapse of the managed investment companies."

The company chairman said that Forestry Tasmania's revenues plunged by as much as $21 million in the same financial year though he asserted that despite the worldwide economic downturn, the state-owned company managed to get through the toughest times and came out of the crisis in a much better shape.

Mr Kloeden is optimistic that recovery is underway for the wood products industry as he stressed that increasing Chinese demand would trigger the anticipated boom and sail the industry through future growths.