Summary Economic indicators of the Victorian hardwood sawmilling industry are traced annually since 1986, when the State's Timber Industry Strategy was announced. The Strategy was based on a longterm commitment by government to the industry, but required several reforms, including: reduced log allocations; more value-adding (i.e. processing beyond green sawnwood); higher log prices; longer licence terms; and increased utilisation of low-grade logs. Historical data on these and related items are plotted and interpreted. They demonstrate that all of the Strategy's proposed reforms have been met, at least partially, with assistance from a sustained erosion of traditional hardwood markets by a rapidly-expanding softwood industry. The hardwood industry's resilience and ability to survive and succeed is evident in the data, allowing the conditional expectation that it will continue to evolve as a successful provider of high-grade sawnwood products for specialised domestic and export markets. Two conditions relating to this expectation are (i) that the State maintains its commitment to the industry's long-term future, as its resource base is wholly State-owned; and (ii) if log prices are increased to meet National Competition Policy requirements, the industry can accommodate such increases.