A vision for the future - forestry's strategy review

By Donal Magner

27 March 2004: The review of the Government's forestry strategy is underway. Minister Joe Walsh has asked Peter Bacon and Associates to carry it out. The announcement coincided with a major conference ‘National Forest Strategy: A Vision for the Future' organised by the Irish Forest Industry Chain (IFIC).

In his opening address to the conference, Minster of State, Noel Treacy said: "The review will focus initially on the 1996 strategic plan ‘Growing for the Future', and will examine areas such as funding mechanisms and structures, national and international environmental and market developments, and changes in land use which will be brought about by the Mid-Term review of CAP.''

The review, which will be presented to Government next September, will, according to Minister Treacy "include wide stakeholder consultation''. The aim of the conference, which was held in Enfield, Co Meath, was "to inform the debate and process leading to the review'' said George McCarthy, chairman, IFIC. Co-hosted by COFORD, the Irish Timber Growers Association (ITGA) and the Society of Irish Foresters, the conference addressed a range of issues which Bacon and his team will need to tackle over the coming months.

Finnish view

Dr Aarne Reunala, Secretary General of the Department of Forestry in Finland, made the opening presentation, ‘Finnish forest vision - formulating and resourcing the national strategy'. Finland has a forest area of 23 million hectares which is 76% of the land area, compared to 9% in Ireland. A quarter of all Finland's exports are from forest products and the industry employs 96,000.

Environmental and multi-purpose benefits - including the public's right of access - play a major role in influencing society's attitudes towards forests. Over 60% of forests are private and most of these are owned by 400,000 growers, with an average forest size of 34 hectares. On the face of it, there are few similarities between the forest industry in Finland and Ireland, particularly in relation to economies of scale.

In the early 1960s, when the annual harvested cut exceeded the increment, the state increased investment into silviculture and research which, Dr Reunala maintained, was crucial in optimising the worth of the forest industry.

As a result, the annual forest increment which was at 55 million cubic metres in the mid-1960s increased to 80 million cubic metres over the following 30 years. Dr Reunala maintained that state investment was the stimulus to creating the climate for private investment. For every €10 million invested by the state annually since 1991, private forest owners responded with an additional increase of €40 million.

A key element in the success of Finnish forestry is the role played by the 158 Forest Management Associations (FMAs). These provide a range of services to their 280,000 members, including silvicultural advice, timber sales and management planning. In Finland, there is an obligatory forest management fee for owners of more than four hectares. This, in addition to consultancy fees, funds the FMAs which are administered by a staff of over 1,000 with an annual turnover of €50 million.

Importance of National Forest Programme 2010

Dr Reunala outlined Finland's National Forest Programme (NFP). The current programme, which runs to 2010, places strong emphasis on sustainable forest management. However, the NFP goes well beyond the forest and aims for a market-oriented industry, driven by Finland's cutting edge technology. This, according to Dr Reunala, ensures that "Finnish forestry know-how is top class by international standards''. He also made repeated references to the multi-purpose role that forests play in the lives of the people: "Forests have cultural benefits including invigorating spiritual and cultural effects.''

The NFP was government-approved in 1999 and there was wide consultation during its preparation. It included an action plan with concrete targets which are measurable and monitored regularly (see table).

Scottish experience

Cedric Wilkins, director of the Scottish Forest Industries Cluster, outlined a number of key issues which the cluster was currently addressing and which could be applied to Ireland, especially given the forecasted increase of small volume logs coming on-stream from private growers over the next 10 years. The cluster is a partnership between the forestry and forest products industries and Scottish Enterprise. Mr Wilkins maintained that a "fibre supply chain needs to become more efficient to successfully host major new investment and that private growers must engage better with their markets''. Mr. Wilkins also believed that "Government policies, especially in bio-energy, need to become more supportive to the commercial forest industry.''

He outlined a number of priorities facing the Scottish cluster.

He maintained that promotion of opportunities for inward and indigenous investment in energy, paper, and added value timber products should be prioritised. He advocated the "promotion of the role of timber in sustainable construction such as joinery and laminated structural timber''.

New answers?

Frank O'Dea, global managing partner of Accenture, believed that the upcoming review was an opportunity to shape an industry which, he believed, would be international in its outlook; an industry that would emulate the Kerry Group and major multinationals such as IKEA.

He questioned the role that the State would play in the future development of forestry and the forest products sector, including the role of Coillte and State agencies. He advocated a number of initiatives, including a timber marketing board and forest enterprise fund which would part-fund start-up enterprises.

Externalities

Professor Frank Convery, Heritage Trust Professor of Environmental Studies in UCD, presented a paper on ‘Internalising the externalities - a key component of future forest strategies'. Externalities provide social and environmental benefits but, as yet, provide little or no monetary benefits. Externalities include recreation, visual landscape, biodiversity, habitats and carbon sequestration.

The problem according to Professor Convery is that since externalities are "usually not traded, it is difficult to derive appropriate prices through which they can be valued''.

Last year, Bacon addressed the externality of carbon sequestration in his report and will no doubt return to it during the upcoming review.

Bacon recommended that there should be a move by Government "to recognising and compensating for the CO2 externality by promoting the development of green credit markets to internalise this value''. This would "incentivise growers to maximise the social value of the forests rather than just the commercial value of the timber''.