Friday, March 29, 2024

Forestry seedling sales at six-year low

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Sales of forestry tree seedlings at New Zealand nurseries fell in 2015 to the lowest level in six years, according to the Ministry for Primary Industries’ latest survey.
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Tree stock sales fell to an estimated 49.5 million seedlings in 2015, from 50.8m in 2014, the lowest level since 2009, MPI reported in its annual provisional estimate of tree stock sales and forest planting, which is based on sales from 28 forestry nurseries.

Sales of exotic tree species for forestry planting have fallen from a peak of 72.5m seedlings in 2012, following the collapse of carbon prices under the Emissions Trading Scheme, the end of a five-year Government afforestation grant scheme and as many landowners convert forestry land to dairy in search of higher returns.

Most of NZ’s exotic tree planting takes place in winter from May to July and MPI estimates 46,000 hectares was planted in 2015, including 3000ha of new planting.

“The area being harvested in the past few years is probably significantly more than has been replanted,” John Novis, who undertakes the survey at MPI, said.

The Emissions Trading Scheme initially helped drive new planting, although a subsequent slump in carbon prices had a major effect on planting, he said.

Carbon prices soared as high as $21.50 a tonne before slumping to $1.45/t and recently traded at $9.20/t, according to OMF.

The price needs to rise to between $15 and $20/t to make investment in agricultural land for forestry planting affordable, according to a report from Professor Bruce Manley at Canterbury University’s NZ School of Forestry.

The conversion of forestry land to dairy, particularly in the central North Island and Canterbury, has also impacted forest planting, MPI’s Novis said. Investors would also be weighing up the commercial returns from timber, which had fluctuated.

Some Maori landowners in Northland were allowing regeneration and other forest owners may be waiting for more information before making a decision on planting, he said.

“There are a range of things happening as to why people are not necessarily immediately replanting harvested areas – it’s not to say they won’t – they might sit on it and think about it for a couple of years and see how some of these things like manuka go and make a decision.”

While manuka planting had become more popular on erosion-prone land, the survey didn’t cover any indigenous species, but focused instead on exotic commercial species such as radiata pine, douglas fir and eucalyptus.

The survey asked nursery managers whether they expect sales in 2016 to be similar to, lower, or higher than 2015. Of the 22 nurseries that responded, five indicated they expected sales to be lower, 10 expect sales to be at similar levels, while seven said they expected sales to be higher.

The Canterbury University report noted nursery capacity could take time to build should demand pick up as nurseries were cautious after a sharp drop in demand led to them having to plough nursery beds full of seedlings after investors changed their minds following the previous slump in carbon prices.

MPI publishes a more detailed description of New Zealand’s planted production forest in its annual National Exotic Forest Description.

The latest report showed at April 1, 2015, New Zealand’s net stocked planted production forests covered an estimated 1.72 million hectares, 16,000ha less than the year earlier.

Harvested areas awaiting either replanting or a land-use decision increased by 9300ha.

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