June 26th 1999

The future for forestry

By Hugh Scanlan

"At present, forestry is not an alternative or competing land use activity and the structure and administration of the EU direct payment system, to the year 2006, means that farmers will be even more reluctant to consider it."

This is the view of Jim Reidy, National Forestry Development Officer with Teagasc, speaking at the recent forestry conference jointly organised by the Irish Forest Industry Chain (IFIC) and Teagasc.

He made the point that, from a simple economic viewpoint, more landowners should plant land over the next few years, than have done so over the last three. However, there are a whole plethora of social, farm size, administrative, legal, planning, pension and economic factors outside of the farm gate, which will also infringe on the levels of planting. In attempting to make an income comparison between forestry and traditional farming, he assumed a net figure of £200 per hectare (£80 per acre) from forestry, which ignores the growing value of the timber asset, on the basis that short term cash flow is the crucial issue for most farmers.

Jim concluded that, in 1997, there were 37,600 cattle and sheep farmers who had a family farm income of less than £200 per hectare and this figure is projected to rise to 43,000 by the year 2000. From a national economic point of view, a substantial amount of land could be planted with trees, without any negative impact on agricultural production. However, the increased suckler cow and cattle payments, as well as the new incentives for more extensive farming and payments under REPS, will force farmers to fill their quotas and retain land for agriculture. The reality, according to Jim Reidy, is that the new CAP reforms are not compatible with the national strategy to double forestry acreage.

He produced figures to show that it will not make economic sense for the typical 60 acre drystock farmer, who does not have an off-farm job, to divert land to forestry.