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Otago Southland 1BT and Pruning Option

Let’s be honest, most of us have that part of the farm that whenever we drive past we think, “I really should do something more productive with that area”.  Then life gets busy and we put it to the back of our mind again. Well now is absolutely the right time to do something with that area, and that something is most likely to plant trees. The long-term cycle of tree rotations means the best time to plant trees is as soon as you can. We don’t want to miss out on a market opportunity in 28 years’ time because we delayed planting the trees by a few years. The current 1BT planting grants of $1,500 per hectare for exotic species and $4,000 for native tree species are unlikely to be available indefinitely. So, the real decision is which species to plant in which location.

The tried and true exotic tree species in New Zealand is radiata pine. We know how it grows in NZ and more importantly, our major markets for forest produce understand radiata.  With many countries around the world also having significant tree planting programs, one consideration is how to differentiate the timber from your trees. Radiata pine has relatively low density and stiffness, particularly in Otago/Southland, so is often less suitable for structural uses. A way to turn this weakness into a strength and differentiate your timber is to prune your trees. In NZ we are very good at growing large trees that produce clear timber when sawn. Clear sawn timber from New Zealand is actively sought after by large European manufacturers due to its low density and stability.  These manufacturers subject the timber to treatment such as thermal modification (Thermowood) furfurylation (Kebony) and acetylation (Accoya). These treatments make the timber more stable and rot resistant. The lower density of radiata leads to higher chemical impregnation, reducing chemical usage by 20%, as well as better reaction to thermal and pressure processes.

 

 

With the introduction of ‘Carbon Averaging’ you should be able to now safely claim and sell more of the New Zealand Units generated from the carbon sequestration of the trees. This provides an additional revenue stream that assists with covering the costs of pruning and thinning your trees. Carbon Averaging also means if you have a longer rotation (ideal for growing bigger trees with more clear timber) you will also increase your carbon average, meaning you have more safe carbon to sell. You will also support your local sawmilling industry that produces clear boards from the pruned logs.

If you use the 1BT grant for planting radiata those trees are not eligible to enter the NZ ETS for the first six years. Using the MPI look up-tables for Carbon Stock on Post-89 Forest Land and $25 per NZ Unit this means you forego approximately $1,200 and $1,600 per hectare in Otago and Southland respectively.

There are likely parts of your farm that are less accessible and these areas are probably more suited to a longer rotation species for carbon revenue. There will also be areas that are more suited to native tree species.

Will this make a difference to climate change?  Probably not, but very little bit helps and will increase the resilience of your property, as well as improving the aesthetics, water quality and biodiversity in your environment. Not to mention that trees are good for the soul! Every site has different opportunities and risks, so your best option is to discuss your situation with New Zealand’s professional forest management company of choice- PF Olsen.  For more information contact  Julie Hayward, PF Olsen Ltd Business Development Manager, Otago Southland.  021 594713 julie.hayward@pfolsen.com