AUSTRALIAN native forest is being woodchipped to be burned in Japan.

Japanese power stations are burning the wood to create energy - a practice soon to be banned in Australia.

Boral Timber executive general manager Bryan Tisher said Boral had sold a mix of plantation and native forest woodchips to Japanese power stations to be burned.

The Japanese Government is forcing coal-fired power stations to replace 10-20 per cent of coal supply with "biomass".

"We've done some trials through those stations.

"It was a precursor to a tender for three-year supply," Mr Tisher said.

"I'll be in Japan later this week progressing those discussions."

Mr Tisher criticised the Federal Government for outlawing the burning of wood chips as a renewable energy - burning wood is seen as a form of renewable energy in Japan.

The move to outlaw the practice in Australia was part of the Government's deal with the Greens.

It means the burning of woodchip is not eligible for carbon credits.

Mr Tisher said this forced Boral to send wood waste to landfill, where it created methane.

He had told a parliamentary inquiry that Australia was sending woodchip to be burned in Europe.

A highly placed source at a timber mill said shipments of native forest woodchips had "definitely" been burned overseas.

The chips had come primarily from Victorian and NSW native forests.

South East Fibre Exports spokesman Vince Phillips said his company had not sent shipments intended to be burned.

"Absolutely none," Mr Phillips said.

However he admitted "anything is possible" once the customers received the product.

The company made wood pellets to be burned by industrial users and in homes in Australia, he said.

Mr Phillips said he was aware of a shipment of Tasmanian native forest woodchips which had been burned.