An increase in seedling sales is a positive sign the forestry industry is gearing up for increased production, Forest Owners Association chief executive David Rhodes says. Sources: The New Zealand Herald, The Country
A Ministry for Primary Industries survey of all 28 New Zealand commercial forest nurseries showed stock sales in 2016 for planting this year were 52.2million seedlings, compared with 49.5million the year before.
A recent ANZ Agri-Focus report said a 5% decline in New Zealand’s overall plantation area during the past decade was leading many industry participants to worry about the long-term supply of wood beyond 2030.
It was described as an “unloved” investment class among many landowners, despite the industry experiencing a period of strong returns.
A statement this week from the Forest Owners Association said the rise in the number of timber trees being produced indicated a recent decline in plantation forest replanting might be reversing, even though those being planted now would not be harvested for about another 30 years.
Mr Rhodes said improved log prices over the past year would be one factor, along with the carbon credit value for planting trees under the Emissions Trading Scheme increasing, now there were not “bogus” Eastern European credits in the market.
One important trend was the gradual increase in the number of timber woodlots on farmland. Farmers appeared to be seeing the counter-cyclical value in having profitable timber plantations growing on their properties to balance low meat and wool prices.
They might also have a long-term eye to carbon offsets from their trees if agriculture was ever brought into the ETS, he said.
Production from New Zealand forests would increase over the next five or so years, due to extensive plantings in the past, which peaked at a growth of nearly 100,000 new hectares planted in 1994.
New Zealand Farm Forestry Association incoming president Neil Cullen, from South Otago, was also heartened by the increased sales of seedlings, saying it did not look like a ”one-off”.
The indication from nearly all responding nurseries was that sales for 2017 were going to be the same or better.
However, the new planting rate was still too low. He did not expect a big increase until the Government provided incentives to deliver policies of national importance through more planting, in particular for improved water quality and to offset greenhouse gas emissions.
Of special interest in the nursery survey was the reported sale of 9.8million manuka seedlings, enough to stock 6300ha, which was a reflection of the current high demand for manuka honey, he said.
The survey revealed an increase in the use of Pinus radiata, with 90% of current plantation trees being this species.
Douglas fir was the next most important species, especially in the South Island.
The Pinus radiata dominance appeared to be increasing and the survey indicated it made up nearly 94% of 2016 seedling sales.
A recent NZIER report, commissioned by the New Zealand Forest Owners Association and Farm Forestry Association, found the forestry and logging sector was worth NZ$1.4billion to the national GDP.
Otago-Southland was one of the areas where the forestry contribution to the regional economies was higher than the national average.
MPI forecast New Zealand forest product export returns to reach NZ$6.15billion by 2020, from NZ$5.14billion in 2016. Increasing returns from sawn timber, wood panels, pulp and paper all contributed.
The fact the “very significant” environmental contribution of forestry was not usually factored into its economic value was a constraint on the industry, NZIER said.
It suggested the lack of a ministry or department dedicated to forestry was a constraint. It also recommended the establishment of a satellite account to reflect the growing importance of the sector. Satellite accounts extended existing information on industries to include social and environmental values.
