Opportunities in Farm Forestry through both new Plantations and Utilisation of existing Private Forest Resources

Ross Garsden
Forestry and Farm Planning Consultant
'Bilongup' Fairy Hill NSW 2470
and
Robert Dyason
Grazier, sawmiller and tea tree oil producer
PO Box 316 Casino NSW 2470

Abstract

Farm Forestry, whole farm and catchment planning, sustainable land management and conservation of bio-diversity are all high on the list of concepts being promoted at both national and state levels. A growing awareness and understanding of the role played by native vegetation in maintaining the ecology of the natural landscape has lead to a re-appraisal of the commercial and ecological values of many native species. Diminishing availability of timber from the public forests has seen a significant rise in royalties in recent times. Australian timbers rank among the finest in the world and it is likely that there will continue to be strong demand for quality sawn timber, let alone pulp and paper. Opportunities exist for landowners willing to embark upon joint-venture agreements, or establish and manage private plantations. Improved management of the existing private forest resource has the potential to generate substantial returns. Native species have the potential for providing a diverse range of alternative sources of 'non-wood' income.

Introduction:

Now is definitely the time to seriously examine the potential for producing real income from timber derived from Australia's prized native timber species. Most Australian schoolchildren these days learn of the early timber-getters who sought the 'red gold' of Australia's forests, the prized timber of Red Cedar. It is not uncommon for people to still comment on what a marvelous timber it is. What is surprising is that such romantic accolades are given to a single species, one of the hundreds of excellent specialty timbers that Australia is so fortunate to be home to. Unfortunately, recognition of Australia's timbers (not to mention the host of other native species that have other non-timber values) and the potential for commercialisation has almost always been realised offshore. The reason for this lack of recognition is simple. There has never been a real need to commercialise the timber resources on private land as there has invariably been easier and quicker alternative income opportunities from more traditional farming practices. The need has been greater elsewhere.

1. The global scene.

Simply, world demand for timber, pulp and paper (in fact all forest products) is increasing and at the same time supply is decreasing. Whilst substantial plantations are being developed in many countries, Australia is sadly lagging behind in this activity.

2. The domestic scene.

Primary agricultural industry in Australia has been locked in a paradigm dominated by sheep, cattle and crops. Where landowners were fortunate enough to hold tracts of land with significant timber resources, these forests have generally been considered as a sideline to the 'real' farming activities. Whilst the forests provided a steady flow of cash at times when it was needed, the owner would rarely have declared the farming occupation as timber production, first and foremost. It has traditionally been a sideline at best. Yet, if you consult the timber industry players they will readily declare that a substantial supply of their timber resource comes from private property.

Private owners have undervalued the standing timber resource as a consequence of artificially deflated timber royalties which have prevailed. Public forests in Australia have been managed by State agencies that have generally ignored the specialty value of our native timbers, selling enormous quantities of premium timbers for conversion into low value products such as scantling. A farmer would therefore have no chance of selling timber at a higher price than that which was being paid for similar timber from the public resource. In this climate, harvesting has been opportunistic, professional management has been lacking and the private resource has been progressively degraded in many places. Unlike other farm enterprises, forests are not as easily assessable for health, vigour, productivity and profitability due to the difference in time taken to realise a return. As such, landowners have had little knowledge or understanding of the growth being achieved, nor the incentive to invest in professional management.

In a well managed eucalypt regrowth forest, yield (timber volume) could achieve 15m3/ha/yr. In many north coast forests that have received little or no silvicultural improvement the stand has stagnated and growth is frequently less than 1m3/ha/yr. Private forestry has aptly been described as Australia's 'sleeping giant.' (Dickenson, 1994).

There could not be a better time than the present to invest in timber plantations. There are several reasons for the timeliness of plantation investment. These are:

3. The Farm Forestry Program

The 1990's, declared as the 'Decade of Landcare' has seen a number of national initiatives aimed at improving productivity and sustainability in the rural landscape by developing a 'healthier' rural ecosystem. The significance of native vegetation is being recognised and a better understanding of the natural systems is emerging. Concepts such as Catchment Management, Conservation of Bio-diversity, Sustainable Agriculture, Whole Farm Planning and Farm Forestry are all on the national land management agenda. The DPI&E Farm Forestry Program aims at integrating trees for commercial timber production into the farming landscape, with a focus on establishment of demonstration sites on previously cleared agricultural land. Along with the trees, there comes a range of other non-wood values such as reduction in wind velocities, reduction in soil erosion, protection and shelter for livestock, improvement in water quality, aesthetic appeal, fauna habitat, streambank stabilisation etc.

One significant achievement of the program has been the provision of a Farm Forestry training course for extension personnel. This course, offered through the University of Melbourne School of Forestry is providing a useful link between sound forest management principles and state agencies who have little or no understanding of some of the basic fundamentals of forest management. For too long it seems that forestry has been the preserve of the foresters and forest management has not been an issue for private interests.

4. State Agencies

It is clear that state land management agencies have been quick to take up the initiative to promote establishment of new timber plantations with some states leaps and bounds in front of others in terms of experience, expertise and extension services. In NSW a joint venture approach has been adopted with landowners able to have State Forests undertake the establishment and management of the tree crop; returns to the landowner are determined by the proportional input from both parties in the joint venture.

5. Plantations and native forests

It is easy to get enthusiastic about tree planting when the potential is clearly there. However, from the outset there must be suitable land available. The national farm forestry program has targeted cleared agricultural land, much of which is unproductive for agriculture. Landowners however have been reluctant in some areas to take up opportunities for establishment of plantation forests. In NSW there are substantial areas of degraded and underutilised cleared country, however in the absence of 'resource security' State Forests have had some difficulty in taking plantations to the people.

It can only be hoped that following the extraordinary haste of reservation of existing crown forests in New South Wales, there will be still in existence a vigorous, competitive timber industry able to take advantage of all these plantations we are going to plant. There is a considerable risk that a valuable industry with huge potential based on well-managed (and they generally are) native forests has been sacrificed on an environmentally-correct altar, with as-yet indeterminate benefits to rural society, the environment and Australia's balance of payments.

In other parts of the country, private forestry is forging ahead especially where recognised and established markets are in place.

6. Royalties

The bottom line to the potential forest grower is going to be the return for the various products which can be derived from the plantation. Traditional markets include woodchip, sawlogs, poles, veneer logs, posts and fuelwood. Developments in timber conversion technology have seen a steady growth in the reconstituted wood products and some exciting processes are showing promise. 'Scrimber' from South Australia is one of particular interest.

For a private producer, maximising the opportunities for generating income from the plantation is essential. A grower would therefore consider species with a variety of end uses in preference to one with restricted uses. Substantial gains are also possible by on-farm processing or 'value-adding.' New technologies in dealing with smaller diameter materials have made previously unmerchantable thinnings into a valuable resource.

7. Species

Matching species to site is the province of a trained professional. Once established it is not likely that a grower will rip it out and start again. Too often we see farmers who have wished to plant trees for a variety of reasons become thoroughly disappointed with their efforts. Reference is often made to species being grown 'off site' or removed from conditions where they would naturally occur. The response has been varied with some species showing spectacular growth whilst others fail.

8. Provenance

The quality of the planting stock is critical. Selection of the appropriate provenance (or genetic stock) is not easily achievable for the small grower and this is where competent advice should be sought. Unless planning and trials have taken place it is possible that suitable species may be obtained yet maximisation of the site potential is not achieved.

9. Genetic improvement - myths and legends

We are barely at breakfast on day one of the journey of exploration into the potential for significant improvement in growth, form and vigour of our native hardwoods. Many species which were previously dismissed as slow growing are now being re-examined with some real promise emerging. It is likely that spectacular improvements are possible.

10. Other opportunities

Some tree species have potential to produce valuable seed crops whilst on their way to maturity as trees for timber. Black bean (Castanospermum australe) and Bunya Pine (Araucaria bidwillii) have dual purpose utilisation.

Acacias, Casuarinas, Banksias, Boronias, Melaleucas and of course Eucalypts all have particular specialty uses, be it tannin, fuelwood, charcoal, cut flowers, seed for revegetation, essential oils, essences, perfumes etc. One of the most outstanding new opportunities is Backhousia citriodora or lemon myrtle which is under examination as a new bush food flavour.

11. Networks and co-operatives

One of the stalling points in the early stages is that potential growers feel isolated. Their future resource contribution, whilst substantial for their farm is seemingly of little consequence in the regional context. It is not uncommon for growers of small stands of timber to receive little or no return when trees are harvested. Previous farm woodlot schemes have seen stands of trees established with no follow-up maintenance. Such stands are crowded and un-productive. Silvicultural management is an essential component in the private forestry equation. Yet from an industry point of view, the collective contributions of many small holdings is what provides a substantial regional resource. On the NSW North Coast it is not uncommon for timber to be hauled several hundred kilometres to feed mills further afield.

There are networks being established across the country, usually with a specific regional focus. It seems that co-operatives have the potential to provide support to growers at the establishment stage and then continue to assist in collective bargaining later on. The Subtropical Farm Forestry Association is one such organisation with a focus on trees from the subtropical region of eastern Australia.

12. State-Run Versus Private Initiative

Private enterprise has an essential and pivotal role to play in the conservation of rare and threatened fauna and flora. Indeed, there is a growing body of evidence to suggest that the real saviors of Australia's endangered species will not be the large tracts of National Parks and reserves set up for the purposes, but will be hard-working, efficient, successful private enterprise. It is private enterprise alone which, by breeding, nurturing and selling the products of our spectacularly diverse and economically valuable Australian native species, will ensure the future survival of species and the habitats which protect them.

Sadly, the system of government reserves, both present and those to be declared in the future, lacks the vital essence and spark which will ensure the survival of endangered species. That vital missing spark is, of course, the placement of a value (other than pure altruism) on the species' survival. By their very character, they are less able to promote the continued existence of rare species by other than passive means.

It is now recognised that many rare and threatened species have great economic value. The timber, essential oil, natural alkaloid, bush food and ornamental horticulture industries have already initiated the retrieval of many plant species from the brink of extinction, without publicity or large-scale land reservation. Financial reward is the initial reason for such retrieval projects. One effect of making rare species (and their habitats) valuable by commercializing them is to improve their prospects for survival. This is done by breeding, cultivating and harvesting a profitable product. Could we apply such a philosophy to the Koala, that most distinctive of our threatened forest products?

Conclusion:

Excessive speculation of projected returns has been deliberately avoided as such figures are of little value unless they can be translated into reality. It appears to be quite certain that prices for timber and other forest products are set to rise and that demand for forest products will continue to exceed supply for the foreseeable future.

The key issues a potential grower must consider are site, species, provenance and quality of planting stock, planning and preparation, silvicultural management, markets and end uses.

The prospects for landowners to gain real returns from investment in timber crops are good and the linkage with the land in a long term venture provides another dimension to land management.

References and further reading:

Brown, A. & Hall, N. (1968) 'Growing Trees on Australian Farms' Comm. Govt. Printer

Dickenson, I. (1994) 'Keynote Address' to the Faces of Farm Forestry Conference, Australian Forest Growers, Launceston, Tasmania. Note: The whole of this publication is essential reading.

Eldridge, K. et al (1994) 'Eucalypt Domestication and Breeding.' Oxford Science (Pub)

Kerruish, C. M. & Rawlins, W. H. M. eds (1991) 'The Young Eucalypt Report' CSIRO

Kremer, K. W. ed (1990 ) 'Trees For Rural Australia' Inkata Press

McDonald, M. W. & Maslin, B. R. (1995) ' The Environmental and Social Utilisation of Australian Acacias.' in IFA Newsletter Vol 36, No 2 April 1995

Neilson, D. (1995) ''The International Perspective for Australia's Native Forest Industry' Background Paper for the National Forest Industry Strategy Conf.

Oates, N. & Clarke, B. (1987) 'Trees for the Back Paddock.' Goddard and Dobson (Pub)

Richards, B. N. (1991) Chairman, National Plantations Advisory Committee Report 'Integrating Forestry and Farming.'

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