Barnaby Joyce is pushing for the conservation status of the critically endangered Leadbeater’s possum to be downgraded to open up areas of protected forests in Victoria for logging, in an effort to save 250 jobs at the Heyfield sawmill.

Joyce wrote to Victorian premier Daniel Andrews on Sunday criticising the decision to reduce the sawlog quota offered to Heyfield mill operators Australian Sustainable Hardwood from 155,000 cubic metres a year to 80,000 cubic metres in 2017-18 and 60,000 cubic metres in 2018-19 and 2019-20, in order to protect habitat used by the possum.

People before possums. There's 21,000 forestry families who will lose their jobs because of Victorian Labor. We... https://t.co/VQhstNZmqj — Barnaby Joyce (@Barnaby_Joyce) March 26, 2017

He said the decision “will cost jobs and ruin the forestry industry”, and suggested that an increase in the number of sightings of the Leadbeater’s possum in the past five years indicated that its numbers had recovered.

“Given the large amount of recent evidence regarding Leadbeater’s possum colonies detected in the central highlands region, including in forest types other than ash and snow gum and in regrowth areas (including areas burnt as recently as the 2009 bushfires), I have asked the minister for the environment and energy, the Honourable Josh Frydenberg MP, to review the threatened species status of the Leadbeater’s possum,” Joyce wrote.

He said: “While I understand the conservation of the Leadbeater’s possum is important, forestry is not the principle threat to the population and I consider the livelihoods of 21,000 Victorian forest industry employees, and their families, deserving of greater consideration and thought by your government.”

The possum was declared critically endangered in 2015. At the time, the threatened species scientific committee, which advises the federal environment minister, said the “most effective way to prevent further decline and rebuild the population of Leadbeater’s possum is to cease timber harvesting within mountain ash forests of the central highlands”.

A spokesman from Frydenberg’s office said he was not able to unilaterally change the status of any threatened species but was open to asking the expert advisory committee to assess conservation status “when new information becomes available.”

“The minister expects the advice he receives on the listing of threatened species to be based on the best available science and information, including population size, trend and distribution,” he said.

Last year the Victorian government’s Leadbeater’s possum advisory group, which was established after 45% of the possum’s habitat was destroyed in the 2009 Black Saturday bushfires, announced that concerted survey efforts had resulted in confirmed sightings of more than 200 new colonies, increasing the number of known individuals to 1,500.

The director of the central highlands environment group MyEnvironment, Sarah Rees, said the increase in sightings did not mean the population had recovered, and said the accepted population figure remained around 3,000.

“We haven’t found new colonies, what we have done is identified colonies where we already thought they were,” she told Guardian Australia.

Even if there had been a slight rise in population, Rees said, it would not justify changing the threatened species status, which is determined by exposure to threats such as habitat loss.

It would basically guarantee the extinction of the species Steve Meacher

“If the case is that we can lose 45% of its primary habitat in two hours on Black Saturday, then we need to take account for that risk in how we manage its habitat and how we mitigate that risk through forestry practices,” she said. “If we keep logging at the rate we are going, this animal is one fire away from being extinct.”

Australian Sustainable Hardwood has said that the three-year supply deal offered by state-owned VicForests is not enough to keep the mill operational and announced this month that it would close by mid 2018.

The company says it needs 120,000 cubic metres a year to break even and has requested the Victorian government release its entire 2017-18 allocation by January 2018 to keep the mill operational for another 12 months, buying time to come up with another solution.

Joyce urged the Victorian government to bring forward supply. He said Victoria should also allow logging of at least 10,000 hectares of state forest set aside for conservation, designated as special protection zones, to offset the loss of production forest to further Leadbeater’s possum habitat protection, and said the federal government was “prepared to immediately approve” such a move.

About 1.2% of previously harvestable mountain ash forests have been designated possum buffer zones since 2014, making them unavailable for logging.

In a confidential report to Australian Sustainable Hardwood’s parent company, the Hermal Group, in 2014, VicForests said the major reason for the reduction in sawlog volume was the 2009 Black Saturday bushfires and dismissed industry claims that protection of Leadbeater’s possum had caused the “supply crisis”.

In a statement, the Victorian government said Joyce’s proposal was “reckless” and “would put the entire forestry sector at risk”.

“Mr Joyce would be better served learning the basics of the forestry industry such as how timber volumes are measured, rather than offering false hope in an area he knows little and has limited commonwealth responsibility for,” the statement said.

“The government believes that the Heyfield mill has a future and has requested the management at [Australian Sustainable Hardwood] work with us to facilitate the sale of the mill to a new operator to save local jobs.”

Australian Sustainable Hardwoods spokesman James Lantry said Joyce did not speak to the company before writing to Andrews. The company was in talks with the Tasmanian government to establish a new hardwood sawmill in Burnie, north-west Tasmania.

“We had always intended to do it, it was going to be in addition to Heyfield but now it appears as though it’s not going to be in addition to,” Lantry said.

A spokesman for Friends of Leadbeater’s Possum, Steve Meacher, said the organisation would oppose any logging in protected mountain ash forests and was taking advice on mounting a possible legal challenge if the transfer went ahead.

About 30% of remaining Leadbeater’s possum habitat is in areas that are currently logged, and Meacher said opening up more areas for logging would have a devastating effect.

“It would basically guarantee the extinction of the species,” he said.