The cellulose story · how a grant nearly killed it
The Australian cellulose industry, and the grant that nearly wiped it out
Cellulose wasn’t a fringe product. For decades it was an established, well-regarded Australian insulation, made by small local manufacturers around the country. What knocked most of them out wasn’t a fault in the product. It was government policy: the 2009–10 pink-batts grant boom-bust. Cellulose was never banned and never found unsafe.
I’m Peter Johnson. I’ve been in this trade since 1986, and I watched it happen. Here’s the straight story: the bits anyone can verify, the bits I saw with my own eyes, and why we’re putting cellulose back on the map through franchising.
Made in Australia since 1986
a good product, killed off by a policy
Plain fact
Cellulose was a normal, well-regarded choice for an Australian roof.
Before the pink-batts years, insulating an Australian ceiling was already common. The Australian Bureau of Statistics found 61% of Australian dwellings were insulated by 2008. Cellulose had its own place in that market, not the biggest seller, but a proven, respected product with a long track record in this country.
You can see how seriously it was taken by where it sat when the whole industry was put under the microscope. When the Home Insulation Program was examined at the Royal Commission, cellulose was treated as a distinct, separately-represented segment of the trade (as reported at the time by The Fifth Estate): its own product, with its own makers, not lumped in with batts.
I’m not going to tell you cellulose ran the market. It didn’t. Glass and mineral-fibre batts always outsold it. The point is simpler: it was a good Australian product, made by real people here, and it earned its place on merit. That’s what makes the rest of this story so frustrating.
Cellulose packed evenly between roof trusses, the same product, made the same way, that Australian homes have relied on for decades.
Made here, by Australians
Local makers, around the country, going back decades.
Cellulose wasn't an import gimmick. It was manufactured in Australia by businesses that had been at it for a long time. Several of them still are.
Cool or Cosy, Adelaide
Established 1984 and still going. It describes itself as the largest cellulose manufacturer in Australia. coolorcosy.com.au
Insulfluf, Melbourne
A Melbourne cellulose maker that says it has been manufacturing for over 50 years. insulfluf.com.au
Insulsafe, Brisbane (our line)
Our own cellulose lineage traces back to Insulsafe in Brisbane from around 1986, which is why we say “since 1986”. Today we make it at our Tiaro factory.
In my experience(and this is my own first-hand recollection, not a figure off a register) there were at least five cellulose manufacturers in Brisbane alone before the grant, several more spread up the Queensland coast (including Townsville), a swag of them in Sydney, plus franchised operators running right across the country. Names like Queensland Insulation Co / Natracel here in QLD and Insul-Guard in NSW were part of that picture. It was a proper little Australian industry, and most of it is gone now. I’m telling you what I saw, not quoting a count from a database. Nobody published a tidy national tally of cellulose makers, and I’m not going to invent one.
What actually happened
The pink-batts grant: a boom, then a bust that cleaned out the little makers.
In 2009–10 the Federal Government’s Home Insulation Program offered free ceiling insulation to millions of homes. It poured money into the trade overnight, and then pulled the rug out just as fast.
- 1
The trade explodes
Almost overnight the number of insulation retrofit businesses jumped from roughly 200 to about 8,300, chasing the grant.
- 2
Cheap imported stock floods in
With demand exploding, a flood of cheap imported insulation came into the country to feed the scheme, squeezing the local makers who'd built their reputation on quality.
- 3
Tragedy, then the brakes
Foil insulation was suspended on 9 February 2010 after deaths and fires; the whole program was halted on 19 February 2010 and formally cancelled on 22 April 2010.
- 4
Targets missed, stock worthless
Around 2.7 million homes had been targeted; only about 1.1 million were done. When it stopped, small operators were left holding stock and unpaid work that was suddenly worth nothing.
These figures are on the public record, from the Royal Commission into the Home Insulation Program, the Australian National Audit Office, and The Conversation. A scheme meant to help the industry ended up gutting the smallest, most careful end of it.
It wasn't the product that failed
The multinationals had the balance sheet to survive. Many small makers didn't.
The deaths and fires that ended the scheme were tied to foil and to untrained workers laying batts in an unregulated rush, never to cellulose. Cellulose was never banned and never found unsafe. It was collateral damage.
The small local cellulose makers
- Left holding worthless stock and unpaid jobs when the grant stopped dead.
- Undercut by a flood of cheap imported stock during the boom.
- No multinational parent to absorb the loss, so many simply closed.
The mineral-fibre multinationals
- Big batt makers held roughly 60% of the market through their industry council (ICANZ).
- Deep enough pockets to ride out the bust and keep trading.
- Came out the other side with even fewer local competitors.
In my own experience, the grant specifically decimated the small cellulose makers and left the multinationals standing, that’s the bit I lived through, and I’ll say it plainly rather than dress it up as a statistic. The product never let anyone down. The policy did.
Why we’re doing this
We’re bringing cellulose back, through franchising.
A good Australian product shouldn’t vanish just because a policy mistake thinned out the people who made it. We’ve kept making cellulose the whole way through (in Tiaro, Queensland) and now we’re rebuilding the network region by region.
Here’s how I read it: the multinationals would rather you keep buying batts (and replace them when rodents move in or they slump and gap in the roof) than have you switch to a seamless product that lasts the life of the house. Franchising lets us put local makers and installers back on the map, with our factory behind them.
Second generation already on the tools. A family business rebuilding an Australian product the multinationals were happy to see disappear.
Straight answers
Questions I get about the cellulose story.
Was cellulose insulation ever common in Australia?+
Yes, it was an established, well-regarded part of the Australian insulation trade for decades, made by a number of small local manufacturers around the country. Ceiling insulation generally was widespread well before the pink-batts scheme: the Australian Bureau of Statistics found 61% of Australian dwellings were insulated by 2008. Cellulose was a distinct, separately-represented segment of the industry. It was treated as its own product category when the Home Insulation Program was examined at the Royal Commission. It wasn't a fringe product; it was a normal choice for an Australian roof.
Was cellulose insulation ever banned in Australia?+
No. Cellulose was never banned and was never found to be unsafe in Australia. The deaths and house fires that triggered the 2009–10 Home Insulation Program Royal Commission were tied to foil insulation (which was suspended on 9 February 2010) and to batts being installed by untrained workers in a rushed, unregulated industry, not to cellulose. The product that got the worst headlines wasn't ours. Cellulose makers were collateral damage of a policy, not the cause of the problem.
If cellulose was so good, why did the local makers disappear?+
Government policy, not product merit. The 2009–10 Home Insulation Program (the 'pink batts' scheme) offered free ceiling insulation and the number of retrofit businesses exploded from roughly 200 to about 8,300 almost overnight. A flood of cheap imported stock came in. When the program was abruptly halted in February 2010 and cancelled in April 2010, small operators were left holding worthless stock and unpaid work. The big multinational mineral-fibre makers had the balance sheet to ride it out; many of the small local cellulose makers did not.
Did cellulose ever dominate the Australian insulation market?+
No, and I won't pretend it did. Glass and mineral-fibre batts were the bigger sellers. The multinationals behind them held roughly 60% of the market through their industry council. Cellulose was a respected, separately-represented segment of the trade, not the biggest seller. The point of this story isn't that cellulose was number one. It's that it was a good, proven, locally-made product, and the small businesses that made it were knocked out by a grant scheme rather than by anything wrong with the product.
Who makes cellulose insulation in Australia now?+
A handful of Australian makers came through and are still going, for example Cool or Cosy in Adelaide (established 1984) and Insulfluf in Melbourne, which has been at it for over 50 years. Our own line traces back to Insulsafe in Brisbane from around 1986, which is why we say 'since 1986'. We make ours at our factory in Tiaro, Queensland. There are far fewer makers than there once were, which is exactly why we're rebuilding the network through franchising rather than waiting for someone else to.
Why are you bringing cellulose back through franchising?+
Because a good Australian product shouldn't disappear just because a policy mistake thinned out the people who made it. The multinationals would rather you keep buying batts, and replace them when rodents move in or they slump in the roof, than switch to a seamless product that lasts the life of the house. Franchising lets us put local makers and installers back on the map, region by region, with our factory in Tiaro behind them. If you want to be part of that, have a look at our franchise page.
Had cellulose in your home for years and want to back a local product? Tell people.
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Want a roof done in a proven Australian product, made by the family that pumps it in?
We’ve made cellulose since 1986 and we never stopped. Send me your address and roof type and I’ll give you a fixed-price quote for seamless ceiling insulation, or, if you’d rather help bring it back, take a look at our franchise.