Deforestation and the degradation of native forests account for an estimated 20 per cent of Australia’s annual net greenhouse-gas emissions. Most of the degradation occurs via chip exports, with the plantation sector having captured 80 per cent of wood processing in Australia. Being perfect substitutes for native forest chips, Australia’s maturing hardwood plantations present a major opportunity for mitigating climate change. But this opportunity will not be realised with ‘business as usual’ forest-policy frames and policy information, which are steering Australia to perverse outcomes favouring investment in an inferior sequestration strategy (plantations) and handicapping the economically superior plantation-processing industry. A major review of the Australian forestry industry in the context of climate change is needed.