Prices of ground for planting forestry has increased significantly over the last decade.
However, in the last two years, hold ups within the forestry services have resulted in a back log at both planting and felling licence stage. Auctioneers report strong prices for this land but a multitude of issues has seen buyers hold back until the dust settles.
“Demand for forestry is very good at the moment,” says Maurice Stack of Sherry Fitzgerald Stack, Abbeyfeale.
Presently, Stack has about 35 forestry plantations of different acreages on the books.
“Our main clients would be Coilte, different large-scale funds looking to invest and, also, there are private investors buying small plantations as a pension. Prices vary from €3,200/ac to €6,000/ac depending on the yield class.“
The challenge with forestry is waiting for licences
Further south, Dunmanway-based auctioneer, Daniel Lehane handles a lot of sale of forestry-type ground and but has seen movement in forestry land reduce over the last two years. He says: “The challenge with forestry is waiting for licences. Before you could sell land subject to approval for planting and there was an eight- to 10-week wait, which could be six to nine months or more now. There’s a scarcity of land coming up with buyers standing back until department issues are resolved. Until the approval time is back to two or three months, that scarcity will continue.”
Barry Lenihan of SWS Forestry agrees with Lehane’s sentiment.
It’s unfortunate because we’re not able to deliver approved land fast enough for our clients
“Waiting on a decision is a difficulty there is no doubt,” Lenihan says. “It’s unfortunate because we’re not able to deliver approved land fast enough for our clients. If approval could be guaranteed within a reasonable time frame of three to six months, there might be more of it sold.”
Despite current hold ups regarding planting and planning, the last decade has seen a rise in prices for forestry ground. Lenihan said:
“Back around 2012 or 2013 we would be advising clients to budget around €3,500/ac if they were looking to buy forestry ground. That crept up to about €4,500 prior to the changes in forestry policy in 2015. Now, you’d be advising a budget of €5,500/ac for decent-sized parcels with no access or productivity issues. Market forces are driving this.
Three of the main drivers of this increase have been:
Changes to the forestry scheme in 2015. Among the changes was the removal of the requirement to hold a herd number. This opened the door to more non-farmers and they have become very active in the land market. Premiums are available to all for the same length of time now, the bonus for farmers is they can now retain their Basic Payment Scheme (BPS) on planted ground. The after effects of the global financial crash was another significant driver in investment in forestry. Lower interest rates and poor returns from deposit accounts saw forestry provide a solid return for private/institutional investors. More recently the rise of the green economy has seen more looking at forestry as a way of investing money and at the same time doing their bit for the environment.
Possible solutions
“Better geographical distribution, environmental scrutiny and landscape level planning must be achieved to avoid the perception that some parts of the country are sacrifice zones.”
Those are some of the issues to be overcome according to Ray O’Foghlu. He is involved with the environmental education unit with An Taisce engaging with landowners. His role on the LEAF (Learn About Forests) programme allow him to understand the reasons why forestry has become a divisive issue in some localities. From this engagement on the ground, he feels there are workable solutions.
“In parts of the west and northwest, planting land or selling land for planting has come to represent a last resort for those who feel they, or their children have limited options. For landowners who wish to continue farming in these areas, high land prices driven by forestry investment vehicles make land acquisition difficult.
I don’t think deregulation of land will be well received in the current climate
“This adds to the collective feeling of a lack of control of their community’s future. In areas with good-quality land, forestry is seen as less of a threat to the farming way of life.”
The need for over all forestry cover to increase has been held back in recent times due to a high level of bureaucracy. Proposals for quick-fix solutions have seen calls from some quarters for deregulation of designated land. O’Foghlu had other suggestions.
“I don’t think deregulation of land will be well received in the current climate. One way of avoiding licencing and regulations difficulties would be to devise a nature-based scheme whereby natural regeneration is harnessed to expand woodlands that already exist. Gorse and other scrub are the first stage of young woodland. Currently, they fall victim to land eligibility rules.
“A native woodland expansions scheme whereby farmers are incentivised to move the fences out a few metres from old woodlands would be a good start. From a biodiversity perspective, these woodlands would be superior to ones planted on greenfield sites.”
Farmer buy-in
Ray’s view is forestry must be a proactive choice for farmers and not something forced upon them. He says:
“Ultimately, farmers want to farm. Any forestry scheme targeting farm land must acknowledge that reality. To achieve this, policymakers must create an easily integrated farm forestry scheme whose benefits are obvious to landowners.
At the very least we need a system that allows farmers push on with these small-scale native woodlands with minimal administrative burden
“I believe there is an openness here to incorporate trees into farm systems in the form of linear and riparian woodlands, agroforestry systems or woodlands in difficult corners or hillsides. The issues in these areas seems to be lack of awareness of the schemes available and an unwillingness to engage in the bureaucracy of the system. At the very least we need a system that allows farmers push on with these small-scale native woodlands with minimal administrative burden.”
Prices of ground for planting forestry has increased significantly over the last decade.
However, in the last two years, hold ups within the forestry services have resulted in a back log at both planting and felling licence stage. Auctioneers report strong prices for this land but a multitude of issues has seen buyers hold back until the dust settles.
“Demand for forestry is very good at the moment,” says Maurice Stack of Sherry Fitzgerald Stack, Abbeyfeale.
Presently, Stack has about 35 forestry plantations of different acreages on the books.
“Our main clients would be Coilte, different large-scale funds looking to invest and, also, there are private investors buying small plantations as a pension. Prices vary from €3,200/ac to €6,000/ac depending on the yield class.“
The challenge with forestry is waiting for licences
Further south, Dunmanway-based auctioneer, Daniel Lehane handles a lot of sale of forestry-type ground and but has seen movement in forestry land reduce over the last two years. He says: “The challenge with forestry is waiting for licences. Before you could sell land subject to approval for planting and there was an eight- to 10-week wait, which could be six to nine months or more now. There’s a scarcity of land coming up with buyers standing back until department issues are resolved. Until the approval time is back to two or three months, that scarcity will continue.”
Barry Lenihan of SWS Forestry agrees with Lehane’s sentiment.
It’s unfortunate because we’re not able to deliver approved land fast enough for our clients
“Waiting on a decision is a difficulty there is no doubt,” Lenihan says. “It’s unfortunate because we’re not able to deliver approved land fast enough for our clients. If approval could be guaranteed within a reasonable time frame of three to six months, there might be more of it sold.”
Despite current hold ups regarding planting and planning, the last decade has seen a rise in prices for forestry ground. Lenihan said:
“Back around 2012 or 2013 we would be advising clients to budget around €3,500/ac if they were looking to buy forestry ground. That crept up to about €4,500 prior to the changes in forestry policy in 2015. Now, you’d be advising a budget of €5,500/ac for decent-sized parcels with no access or productivity issues. Market forces are driving this.
Three of the main drivers of this increase have been:
Changes to the forestry scheme in 2015. Among the changes was the removal of the requirement to hold a herd number. This opened the door to more non-farmers and they have become very active in the land market. Premiums are available to all for the same length of time now, the bonus for farmers is they can now retain their Basic Payment Scheme (BPS) on planted ground. The after effects of the global financial crash was another significant driver in investment in forestry. Lower interest rates and poor returns from deposit accounts saw forestry provide a solid return for private/institutional investors. More recently the rise of the green economy has seen more looking at forestry as a way of investing money and at the same time doing their bit for the environment.
Possible solutions
“Better geographical distribution, environmental scrutiny and landscape level planning must be achieved to avoid the perception that some parts of the country are sacrifice zones.”
Those are some of the issues to be overcome according to Ray O’Foghlu. He is involved with the environmental education unit with An Taisce engaging with landowners. His role on the LEAF (Learn About Forests) programme allow him to understand the reasons why forestry has become a divisive issue in some localities. From this engagement on the ground, he feels there are workable solutions.
“In parts of the west and northwest, planting land or selling land for planting has come to represent a last resort for those who feel they, or their children have limited options. For landowners who wish to continue farming in these areas, high land prices driven by forestry investment vehicles make land acquisition difficult.
I don’t think deregulation of land will be well received in the current climate
“This adds to the collective feeling of a lack of control of their community’s future. In areas with good-quality land, forestry is seen as less of a threat to the farming way of life.”
The need for over all forestry cover to increase has been held back in recent times due to a high level of bureaucracy. Proposals for quick-fix solutions have seen calls from some quarters for deregulation of designated land. O’Foghlu had other suggestions.
“I don’t think deregulation of land will be well received in the current climate. One way of avoiding licencing and regulations difficulties would be to devise a nature-based scheme whereby natural regeneration is harnessed to expand woodlands that already exist. Gorse and other scrub are the first stage of young woodland. Currently, they fall victim to land eligibility rules.
“A native woodland expansions scheme whereby farmers are incentivised to move the fences out a few metres from old woodlands would be a good start. From a biodiversity perspective, these woodlands would be superior to ones planted on greenfield sites.”
Farmer buy-in
Ray’s view is forestry must be a proactive choice for farmers and not something forced upon them. He says:
“Ultimately, farmers want to farm. Any forestry scheme targeting farm land must acknowledge that reality. To achieve this, policymakers must create an easily integrated farm forestry scheme whose benefits are obvious to landowners.
At the very least we need a system that allows farmers push on with these small-scale native woodlands with minimal administrative burden
“I believe there is an openness here to incorporate trees into farm systems in the form of linear and riparian woodlands, agroforestry systems or woodlands in difficult corners or hillsides. The issues in these areas seems to be lack of awareness of the schemes available and an unwillingness to engage in the bureaucracy of the system. At the very least we need a system that allows farmers push on with these small-scale native woodlands with minimal administrative burden.”
This is a subscriber-only article
SHARING OPTIONS: