Woodside Forest: learning and adapting

John Novis, Ian Platt and Alan Griffiths

For 25 years, John Wardle worked as a scientist and senior forest ecologist for the New Zealand Forest Research Institute, with the ecology of beech (Nothofagus spp.) forests as his specialty. During this time, John and his wife Rosalie purchased Woodside Forest, 121 hectares of predominantly regenerating indigenous beech forest, and worked - as time permitted - on a strategy of conserving the forest through active and adaptive management. This coincided with the beginning of an intense, and deeply divided public debate over the future management of New Zealand's indigenous forests.

Dr Wardle is the author of the book, The New Zealand beeches, published in 1984, just before he left the Forest Research Institute to focus his energies on the management of Woodside Forest. The book is regarded as the definitive textbook on New Zealand beech forest ecology, so his change of focus to full-time forest manager put into practice the knowledge gained through those years of research - the ultimate test of his understanding of beech forest ecology.

But the management of Woodside Forest is a family effort. His wife Rosalie, and their younger son, Bruce, are very much part of the family management team. "Rosalie works with me on most forest operations," John explained, "and Bruce, who lives off site with his wife and family, manages the beech forest honeydew honey operation."

Living within their forest and relying solely on income from the forest for their livelihoods possibly makes the Wardle couple unique in New Zealand.

The job has not been easy, despite John's unrivalled research experience. He noted that some of the immediate ecological challenges relate to indigenous beech forests, which comprise a mosaic of age classes, primarily as a result of regular wind damage and windthrow, and the occasional heavy snowfall. Damaged trees are also prone to attack by pests and diseases, particularly pinhole borer (Platypus spp.) and the associated fungal pathogens of the genus Sporothrix.

The Wardles have learned, and continue to learn, how to adapt their forest management to these natural events. According to John, an additional challenge is the successful control of a variety of exotic pests that can cause significant damage to both the flora and the fauna of Woodside Forest.

Woodside Forest

Woodside Forest is now one of the most innovative in terms of forest management in New Zealand. But in the past, it was almost totally devoid of forests.

"Woodside Forest itself was logged between 1895 and 1909. Cut stumps remain today, scattered throughout the forest and pasture, indicating that all of the property was once under forest. Charred stumps show that the area was burned, probably by the 1898 fire," John stated.

Historical records show that the property was managed as a pasture for sheep between 1914 and the 1930s, when it was largely abandoned during the depression years. From 1940 to 1973, the land was managed for summer grazing of about 100 sheep. Pasture grasses were not adequately maintained and beech forest returned in three phases. The first phase began after the initial logging and the 1898 fire. The second phase occurred during the depression years (the early 1930s), and the third phase commenced after the Wardles purchased the property in 1973 and management shifted away from grazing and towards sustainable production forestry.

Today, the majority of Woodside Forest comprises indigenous black beech (Nothofagus solandri var. solandri), but the Wardles have planted a smaller area with exotic species (principally Pinus radiata), and some agricultural land remains. The land and forest are managed as follows: beech production forest (70 hectares), beech forest reserve (14 hectares), exotic plantation (29 hectares) and agricultural and residential areas (8 hectares).

The Forests Act 1949

The sustainable beech forest management of Woodside Forest falls under Part IIIA provisions of the Forests Act, 1949. Part IIIA is an amendment to the Act that applies to privately owned indigenous forest (with a few exceptions), and was one of a number of government initiatives in the early 1990s that addressed sustainable indigenous forest management. Enacted in 1993, it provides for the milling of indigenous timber at registered sawmills as long as the timber is harvested under one of the following options: a Sustainable Forest Management plan; a Sustainable Forest Management permit; or so-called "other provisions" that cover salvage timber, windthrown or dead standing trees, timber felled for a "public work," for a mining operation, for building or maintaining an access way or water impoundment or for scientific research and timber for personal use.

Woodside Forest was the first property in New Zealand to have a Sustainable Forest Management Plan approved. "This occurred on May 18, 1994," John recalled. While this was a notable event, the Wardles have been committed to sustainable forest management since purchasing the property in 1973.

Adaptive ecosystem management

Indigenous forest management

Of the 84 hectares of black beech forest, 70 hectares are managed with timber production as an objective. The remaining 14 hectares are managed as a reserve with no timber harvesting. In addition to forest protection, this reserve provides a baseline against which the effects of silviculture and harvesting in the production area can be assessed.

"The management regime is adapted to work with the ecological processes that naturally determine the structure of the beech forest," John emphasized. Adaptations are refined continually on the basis of observation and experience. The emphasis of the management regime is improving the next generation of trees. "Our harvesting systems are designed to mimic natural stand replacement associated with wind disturbance and regeneration, the major driving force in the ecology of beech forests," John added.

Forest replacement is primarily through natural regeneration, which is usually prolific in harvested coupes and windthrown sites. Where crown fern (Blechnum discolour), an indigenous ground fern that is often dense in shady areas, limits natural regeneration, the Wardles clear the area by hand grubbing small patches of up to one square metre to provide sites for seedling germination. This is usually carried out before the removal of the protective forest canopy. "Seedlings are planted only as a last resort in the event of regeneration failure," John noted.

Initial harvesting strategy

The strategy approved in 1994 under the Sustainable Forest Management plan involved the beech forest component of Woodside Forest being divided into six working blocks. "Each working block was to be partially harvested under 'group-small coupe' management once every six years, over a rotation of 48 years," John elaborated. At that age the average tree diameter at breast height is 45 centimetres, which John considered to be the optimal size for milling and wood quality. Larger trees become vulnerable to pinhole borer and internal rot.

New harvesting approaches

The harvesting strategy, however, has changed over time. As John explained, "Because we've found that the sustainable harvest can be largely sourced from individual or small groups of trees that have been windthrown or are dying, rather than through programmed harvesting. This currently accounts for over 90 percent of the timber harvested."

Where programmed harvesting is undertaken, the Wardles now favour a continuous canopy selection system - a form of shelterwood management whereby the canopy trees are progressively thinned to promote advanced regeneration - over a group-small coupe selection system. As John put it, "Continuous canopy selection affords better protection to regeneration from winter desiccation, and promotes greater stability against wind in stands. It also protects the tree's cambium from the 'sunburn' effect of hot, dry winds." Sunburn is something that John learned about in discussions with Chilean foresters; it results in the death of the cambium with the tree becoming unstable and liable to suffer stem breakage.

Sawmilling and marketing

The Wardles mill the indigenous beech logs on the property using their own portable Varteg mill. With only a small volume of black beech sawn since the early 1900s, John remarked, "We had to learn how to read each log to efficiently cut the best timber, and establish effective drying and storage techniques prior to selling the timber to local manufacturers."

Black beech is not the most highly regarded (commercially) New Zealand beech species. However, the Wardles have established successfully local markets for the highly figured (i.e. with prominent colour and grain variation) timber, which is used for furniture, panelling, flooring, turnery and tool handles. Lower quality wood is sold as fuelwood for home heating in local markets and in Christchurch. In most instances the wood is burned in enclosed "woodburners," which are much more efficient than open fireplaces.

Exotic plantations

When the Wardles purchased Woodside Forest in 1973, a significant part of the property was unimproved pasture. "This land was economically marginal for agriculture and was mostly set aside for the establishment of exotic plantations," John indicated. Some 29 hectares have been planted, predominantly with Pinus radiata, which the Wardles planned to manage on a 30-year rotation. Some enrichment of these stands is being undertaken, especially in areas of poor initial establishment. "Our enrichment plantings are mostly with coastal redwood and Douglas fir, and to a lesser extent, with larch, Mexican cypress, deodar cedar and Cryptomeria," he said. Black beech also seeds naturally in these stands.

Just as the initial strategy for the beech forest has changed, so too has the strategy for the exotic plantations. "Our long-term aim now is to convert the Pinus radiata stands to mixed-aged, mixed-species stands, and to harvest them on a continuous canopy concept (like the indigenous beech forest) using size class, form and spacing as the major criteria for selection," John explained.

This management strategy is unique in New Zealand. The traditional New Zealand plantation forestry model is one of single-species (usually Pinus radiata) stands, and a single age class, clear-felled at maturity. The Wardles' approach reflects a desire to manage their forest in a way that is more consistent with natural ecological processes, albeit applied to exotic tree species.

Initial harvesting trials applying the continuous canopy concept were undertaken in the autumn of 2002. "Results indicate that harvesting costs and damage to the residual stand will be within acceptable levels," John reported. The Wardles predict that ultimately they will be able to harvest 1 100 to 1 200 cubic metres annually on a sustainable basis (about 40 cubic metres/hectare/year).

Beech forest honeydew honey

Associated with beech forests in this part of the country is an indigenous coccid insect (Ultracoelostoma assimile) that infests the bark of the trees. During the intermediate stage of its lifecycle, the insect exudes excess carbohydrate from the tree cell sap. "This is known as honeydew and provides an important food source for various birds, the brush-tailed possum, and the insects that inhabit the beech forests," John noted. "Honey bees use the carbohydrate as an alternative to flower nectar and produce beech honeydew honey, which is similar to maple syrup in texture and properties."

The beech honeydew honey operation on Woodside Forest is managed by John and Rosalie's son, Bruce, and provides valuable part-time employment. "Honeydew production varies from year to year in response to weather conditions, but is generally sufficient in Woodside Forest to support 300 beehives. We limit the number of beehives so there is sufficient surplus honeydew for the resident nectivorous indigenous bird population," explained Bruce. Current production of beech honeydew honey from the property is about 15 000 kilograms/year, or 170 to 180 kilograms/hectare/year. This is exported mostly to Germany.

Pest management

A variety of pests also have a strong bearing on the Wardles' forest management. The pests of principal concern are red and fallow deer, the brush-tailed opossum, stoats, cats, rats and wasps. "All these pests have been introduced to New Zealand, and are not subject to natural control," John lamented. "Predation and competition by these animals and insects have caused a number of extinctions of indigenous birds, reptiles and insects, in and around Woodside Forest over the last 30 years. Deer, particularly, have a major destructive impact by rubbing their antlers on young trees, killing or damaging many trees each year," he added.

The Wardles can control most of these pests on Woodside Forest through their own trapping and well-designed and carefully located poison bait stations. The broadscale application of "10-80" poison (sodium fluoroacetate), commonly used for opossum control in the country, is no longer employed on Woodside Forest. When it was used in the past, even in close proximity to Woodside Forest, the Wardles observed marked reductions in insect and birdlife in the forest. Natural values are accorded high importance in the management of the Woodside Forest.

Recognition of achievements in sustainable management

The Wardles' achievements have not gone unnoticed by their peers. They have recently won the (New Zealand) 2003 Transpower-Landcare Trust Award for Innovation in Sustainable Farm Forestry, and in 1995 they won the Husqvarna South Island (of New Zealand) Farm Forester of the Year award.

Visitors also flock to the Woodside Forest. The Wardles estimate that they commit 15 to 20 days each year to hosting around 200 visitors at Woodside Forest, demonstrating and discussing their methods of indigenous beech and plantation forest management. The visitors have included forestry students from nearby Lincoln and Canterbury Universities, farm foresters and foresters from around the country, overseas groups, members and committees of Parliament, government bodies and the Minister of Forestry. "Recently, delegates attending a United Nations Forum on Forests (UNFF) meeting on forest plantations spent a day here," John smiled.

This is a substantial commitment, but their time is generously given to sharing their experiences at Woodside Forest and furthering people's understanding of sustainable forest management.

Meanwhile, Landcare Research Limited, a New Zealand Crown Research Institute, undertakes research projects on Woodside Forest. Current research is investigating site identification and classification based on physical and vegetative indicators. This information will be valuable in predicting forest composition and performance, and will assist forest managers in making site-specific management decisions.

John Wardle (far right) discussing sustainable beech forest management with UNFF delegates (courtesy Ian Platt).

Furthermore, a Lincoln University student is to visit soon to discuss establishing a research project concerning the growth of Pinus radiata under the Wardles' continuous canopy management strategy.

Conclusion

When the Wardles won the (New Zealand) Transpower-Landcare Trust Grants Award for Innovation in Sustainable Forest Management, the exceptional features of their enterprise were identified as managing a natural New Zealand forest to preserve and enhance its intrinsic values whilst sustainably harvesting a special and limited timber resource; mirroring natural processes in their silviculture and harvesting techniques; adding value to the timber on-site; diversifying from an economic perspective by establishing a supplementary radiata pine plantation, and a range of other species grown for special purpose timbers, experimental and amenity purposes; and promoting and demonstrating conservation of environmental values as part of sustainable management and harvesting by hosting field days, visitors and research.

These achievements, however, are not attained without vision, planning and commitment.

Indigenous forest management has been the subject of much public and political debate in New Zealand over the last 30 years. There has been a strong lobby (from some non-forest owners) against harvesting any indigenous forest. The Wardles, however, have always believed in conservation of indigenous forests through active and adaptive management. This vision was put into practice at Woodside Forest through the development of a long-term plan, dedicated commitment to the vision and plenty of hard work.

About the authors

John Novis, Ian Platt and Alan Griffths are employed by the New Zealand Ministry of Agriculture and Forestry. John is a forest policy analyst, with one of his principal work areas being indigenous forestry. Ian and Alan work for the Ministry's Indigenous Forestry Unit, administering the indigenous forestry (sustainable forest management) provisions of the Forests Act, 1949.

The mini-skidder has minimal impact on the forest (courtesy Ian Platt).

Diamond Raya Timber concession: diamonds are forever?

Bart Willem van Assen

"The Minister of Forestry should cancel the concession permit of PT Diamond Raya Timber and the Indonesian Ecolabelling Institute must revoke its certificate of sustainable production forest management." This demand was tabled in 2002 by the coordinating team of the Forest-Dependent Communities Development Program covering seven villages within PT Diamond Raya Timber's concession area.

Heiko Liedeker, Executive Director of the Forest Stewardship Council, disagreed with the proposition: "Diamond Raya Timber is understood to be one of the most progressive concessions in Indonesia, but there is no pretence that it is perfect."

These statements exemplify the controversy surrounding the certification of Diamond Raya's forest management practices. Several parties have contested the company's certification since the concession first received a stamp of approval from the Indonesian Ecolabelling Institute in 1999, while others laud Diamond Raya for its positive efforts toward forest management. The tension reflects the spectrum of management philosophies, ranging from preservationist perspectives to beliefs that forest conservation must necessarily encompass strong human interaction - including logging.

The forest concession

"The Diamond Raya forest concession is situated along the east coast of Riau Province, about 250 kilometres north of Pekanbaru (the provincial capital). The forest concession currently occupies more than 90 000 hectares of lowland tropical forest, almost all of which is at elevations less than eight metres above sea level," said Arus Mujijat, Production Director of Diamond Raya Timber. "The concession contains small areas of mangrove forest, but about 98 percent is classified as peat swamp forest. The most important timber species we harvest is ramin (Gonystylus spp.)."

Mr Mujijat's description succinctly encompasses two major controversies concerning the Diamond Raya concession. Sumatra's peat swamp forests and the ramin tree have both become endangered during the last decade due to logging (both legal and illegal). Other controversial environmental aspects relating to the concession are the presence of the nearly extinct Sumatran tiger and concerns about susceptibility and proximity to Sumatra's infamous forest fires.

Peat swamp forests

The World Wide Fund for Nature (WWF) classifies Sumatran peat swamp forests as a distinct forest type. Peat deposits were formed when rivers drained into the inland edges of mangrove forests and organic matter and sediments were trapped within the tangle of roots. Over time, the sediment deposits built up and the areas become less susceptible to flooding. Peat deposits may be as deep as 20 metres.

Most peat swamp forests lie along the eastern coast of Sumatra, where a thick layer of decomposed vegetable matter (peat) exists. Peat soils are strongly acidic (with a pH of usually less than 4) and they have a high sulphate content. The soils also have extremely low fertility due to leaching; this necessitates the forest to draw nutrients mainly from recently decomposed dead organic matter. The region's blackwater rivers - named for their cola-coloured waters - contain high levels of tannins and organic acids, and are characterized by their lack of aquatic plants. Peat swamp forests do not support a wealth of terrestrial wildlife and have few endemic species. The number of species and the absolute numbers of animals tend to be lower in peat swamp forests than in surrounding lowland rain forests. Moreover, there is no mammalian species that makes the peat swamp forest its exclusive habitat.

The flora in the forest concession has not been fully documented, but it contains around 40 tree species; among commercial species there are several types of meranti (Shorea spp.) and suntai (Callophyllum macrocarpum).

Large areas of peat swamp forest have been converted to agriculture by the government to support transmigration settlements and development projects, especially in southern Sumatra. Less than half of Sumatra's peat swamp forests now remain, and logging concessions cover almost 80 percent of the remaining areas. Consequently, logging is perceived as a serious threat to habitat integrity and the conservation of sufficient areas representative of this distinctive ecosystem.

Ramin

Representatives of Forest Watch Indonesia contend that the area of Diamond Raya's concession is an important ecosystem for ramin, which should be protected rather then logged. Ramin (Gonystylus spp.) has historically been one of the major export timbers from Southeast Asia and commands premium prices, up to US$1 000 per cubic metre, making it the most valuable timber species found in Indonesia. The light-coloured timber is suitable for interior uses, including mouldings, construction of fine furniture, picture frames, futons, snooker cues and toys, among others.

Although ramin is found from the Malay Peninsula to the Solomon Islands, the main source of ramin timber is Indonesia. High prices for ramin have resulted in an explosion in illegal trade of the timber, mainly routed through Malaysia and Singapore. In August 2001 the Indonesian Government had the species listed in Appendix III of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) to crack down on illegal harvesting and export. This resulted in a ban on exporting ramin from Indonesia - with the sole exception being ramin harvested from its only certified source: the Diamond Raya Timber concession.

According to a recent report released by the London-based Environmental Investigation Agency (EIA) and Telapak Indonesia, the "export ban" has been successful. Currently, illegal logging and trade of ramin have been reduced - but not halted - throughout the country. This contrasts with an EIA report, in 2001, that estimated around 5 million cubic metres of illegally harvested ramin were being smuggled into Malaysia annually. Various initiatives have been established to validate the legality of timber by certifying its origin and tracking its movement. "The Forest Stewardship Council provides a system to monitor the origin of timber through processing to retailing through a system known as chain-of-custody certification," explained Alistair Monument, Accreditation Officer at the Forest Stewardship Council.

Illegal logging

Illegal logging is widespread and systemic in many parts of Indonesia. Estimates of the volume of illegally logged timber run as high as 50 million cubic metres of timber each year, or more, supplying as much as 70 percent of Indonesia's industrial wood. The related economic losses have been estimated at some US$3.5 billion annually.

Some environmental organizations and local people have accused the Diamond Raya Timber concession of illegal logging. The company refutes these claims, asserting that illegal harvesting that is occurring in the area is being carried out by local residents beyond the control of the company.

A 2002 SGS Qualifor Forest Management Surveillance Report noted that Diamond Raya had "taken adequate actions to stop illegal activities in the forest concession. The company has committed to conduct regular surveillance using a helicopter and boats to monitor illegal activities." The same report noted, however, that Diamond Raya "has not developed a revised procedure and action plan for monitoring the concession for illegal activities by villages and staff based on accessibility."

Sumatran tiger

The Sumatran tiger (Panthera tigris sumatrae) is Indonesia's largest terrestrial predator but, as with other tiger species around the world, it is critically endangered. An estimated 400 Sumatran tigers live in the wild, mainly in the five national parks of Sumatra. The Sumatran tiger occupies a variety of habitats, provided these have sufficient food, water and cover. It mainly preys on barking deer, locally named rusa and muncak, and wild pigs. Its exact range is unknown, but the number of tigers in a particular locality strongly depends on the availability of prey.

The Rainforest Foundation, which supports indigenous people and traditional populations that live in rain forests, claimed some years ago that Diamond Raya's timber harvesting was endangering tiger habitat. Forests Organization, Inc., an environmental advocacy group, followed with a statement criticizing certification standards and arguing that logging of endangered tiger habitat was being glossed over as "green" forest management.

Arus Mujijat acknowledged that tigers have been sighted within the concession's boundaries. "But our certifiers concluded that tigers and other wildlife had actually moved into our forest as a result of improved forest management within the concession at the same time that surrounding forests were becoming more disturbed and degraded," he explained. The SGS Qualifor Main Assessment Report notes: "There are important arboreal primates such as gibbons and also Sumatran tigers that are moving into the concession area from the south where their habitat is being disturbed." Furthermore, it remains unclear whether the Diamond Raya Timber concession can sustain a healthy tiger population. Claims that it is a true habitat for the Sumatran tiger have not been scientifically established.

Forest fires

Forest fires have been a serious issue in Sumatra since the infamous smog and haze ("smaze" as some people called it) events of the late 1990s. Riau is one of the more fire-prone provinces of Sumatra, and forest fires occurring here are clearly linked to forest concessions, plantations and land conversion. Smaze disrupted Singapore, parts of Malaysia and even southern Thailand throughout much of the 1990s, with large peat fires in Riau being a major contributor. Most of the fires were deliberately set by land developers to clear forested areas for oil-palm plantations or other agricultural crops. To date, no serious forest fires have occurred within the concession of Diamond Raya Timber. But recently, surrounding concessions, including Diamond Raya's sister company (Sindora Seraya), have been sued for illegal use of fire related to land clearing and for failing to control forest fires. This underscores the need for improved forest fire prevention and management strategies that minimize fire risks.

Within the Diamond Raya concession itself, however, the risk of forest fires is very low. As Arus Mujijat clarified: "Fires in peat swamp forests occur only when groundwater levels are reduced, which allows the peat to dry. We are not undertaking any deliberate drainage in our concession, so fires are very unlikely - much of the forest is growing in swamp water up to a metre deep. Since itslicensing in 1979, there have been no forest fires within the concession."

Forest management

The management of the forest concession is influenced by all of the aforementioned controversies. Arus Mujijat explained: "Logs are extracted by manual labour and light rail systems because the peat cannot support heavy motorized vehicles. A few permanent rails run into the forest, and temporary feeder lines are laid as cutting blocks are accessed. Additional investments are made to safeguard ramin and Sumatran tigers. Also, research and development is ongoing in cooperation with renowned institutes like Bogor Agricultural University, the Indonesian Research Institute and the Ministry of Forestry. For example, efforts are being made to develop effective practices for multiplying ramin through tissue culture."

Diamond Raya Timber's forest management is based on the Indonesian Selective Cutting and Replanting System, generally operating on a cutting cycle of 35 years. Harvesting in the Diamond Raya concession has extended the cutting rotation to 40 years, but has reduced the standard diameter^[28] cutting limits to 40 centimetres for dipterocarp species, and 35 centimetres for ramin, as was authorized for swamp forests in 1996. The annual allowable cut (AAC) - the sustainable level of timber exploitation - is presently set at 79 000 cubic metres, with approximately 2 000 hectares targeted for harvesting each year.

The company constantly reviews the AAC to ensure sustainability. "We have set up 30 permanent research plots throughout the concession, and are planning 30 more," clarified Arus Mujijat. "These plots provide us with information about the annual increment after selective felling, as well as enabling comparison with the dynamics of undisturbed plots. By contrasting these findings, we are able to estimate the impact of our activities." The SGS Qualifor Main Assessment Report (2000) noted that only about two-thirds of the trees allowed under government regulations for felling were actually felled by the concession under its conservative management approach.

Mujijat continued: "We harvest the trees in a designated block based on data obtained from the permanent research plots. An area is opened up for exploitation by installing temporary infrastructure, such as a rail track and the base camp. Then, teams of loggers are trained to conform to stringent logging rules. After felling, the logs are bucked at the felling site and skidded to collection points by manual labour; we cannot use mechanical extraction on peat soils. The logs are transported to the main log yard using the temporary railway. The majority of logs are sold to our sister company, PT Uniseraya, under Forest Stewardship Council/Lembaga Ekolabel Indonesia Chain of Custody certification."

Reforestation is carried out meticulously after logging. Seedlings of the six or seven logged species are grown in Diamond Raya's nurseries and planted in the logged areas. Reforested areas are monitored for their recovery after logging. "From the recovery of these reforested areas," said the production director, "we can conclude that our logging has very little impact on the ecosystem. Permanent damage due to logging and extraction is insignificant. And the long-term canopy opening due to logging is minimal." Vulnerable areas such as log landings are immediately replanted to prevent the invasion of aggressive palm species such as the salak palm (Zalacca spp.).

Arus Mujijat stressed the company's commitment to protecting the biodiversity of the concession: "Apart from the exploitation areas, we've set up various protected areas within the concession. Each year, we set aside 10 percent of the annual cutting block as conservation areas. Observations from these conservation areas and the logged areas indicate that the impact of forest harvesting and other management activities on the wildlife is minimal." Various monitoring efforts are being made to better understand the level of biodiversity and the various interactions of environmental components in the concession. The company recognizes that there is still plenty of work to be done in this respect, but it is working constructively to incorporate existing knowledge into its planning.

Certification

Diamond Raya Timber was sufficiently confident about the quality of its forest management that it applied for certification in 1998. "Certification can provide a guarantee that a product comes from a well-managed forest, as long as the certification is carried out in accordance with a credible system," indicated Daru Asycarya, head of the accreditation and certification office of the Indonesian Ecolabelling Institute.

Currently, two specialist forestry certification schemes are available in Indonesia: the national scheme of the Indonesian Ecolabelling Institute (Lembaga Ekolabel Indonesia) and the international scheme of the Forest Stewardship Council. There are considerable differences between the schemes, and comparisons are ambiguous. Under a Joint Certification Program now in place, both schemes aim to develop a "jointly agreed standard" for certification of natural production forests in Indonesia. Until such a standard is developed, forest concessions must meet both sets of certification criteria to obtain a joint certificate of sustainable forest management.

Arus Mujijat enumerated some of the principal advantages of certification: "The most important benefit is improved access to the timber markets of Europe and the United States of America. The protected status of ramin, under CITES, is also to our advantage," he said. "Diamond Raya is now the only legal producer of ramin timber in Indonesia. In addition, our annual management plans no longer need approval from the Department of Forestry. This is a significant bureaucratic hurdle we are now trusted to bypass." The Ministry of Forestry still requires that Diamond Raya submit the statutory 5- and 20-year plans.

The company had hoped to realize a price premium for certified timber. However, the reality has not met expectations. "When we applied for certification, there were promises and expectations of a premium of around 35 percent above prices for uncertified timber. In reality this premium is presently no more than five percent. This has been a disappointment and strongly reduces the incentive to invest in certification," Arus Mujijat stated.

Certification also encompasses a number of costs and disadvantages. "The environmental and social investments necessary to obtain certification are considerable, and the price premiums hardly justify these investments," explained Arus Mujijat. For instance, at present Diamond Raya Timber is required to employ local people with little knowledge of commercial forest management. This enables the company to meet the social criteria for certification, but does not enhance the economics of the company's operations.

Another significant disadvantage is the market's appetite for cheap illegally felled or exported timber. "The markets accepting illegal timber include Europe and the United States of America. Buyer groups should be more consistent in their demands for legal and certified timber to assure more stable markets for certified products. On the other hand, Indonesian society provides little or no support to concessions that are aiming for certification," Arus Mujijat deplored.

Diamond Raya Timber obtained national certification from Lembaga Ekolabel Indonesia in 1999. Under the Joint Certification Program that followed, it failed its 2000 certification review due to shortcomings in its environmental and social programmes. Among the major areas requiring corrective action were:

• a failure to demarcate sufficient area for conservation of important and endangered species;

• a requirement to provide education on the forest ecosystem;

• a need to resolve disputes over community forest user rights and

• appropriate compensation;

• the number of locally recruited employees was considered too low; and

• insufficient training was provided to employees and local communities.

"Following this disappointment, we worked hard to improve our operations. In 2001, we were rewarded for our efforts with a new, international certificate," reported Arus Mujijat. "Currently, we are the only natural forest concession in Indonesia - out of almost 300 - to receive a stamp of approval from both certification schemes."

Controversy

However, the certification of Diamond Raya Timber remains controversial. Local non-governmental organizations that are considered the "leading voice" of local forest-dependent people, and advocates for sound ecological and social practices in forest management, disagree with the certification. They accuse the concession of inciting land tenure conflicts, provoking disputes over the employment and schooling of local people, implementing illegal logging and working with incomplete management plans for the environment and production. "The certifiers uncritically certified Diamond Raya Timber, meaning the system can be easily abused," said Arbi Valentinus, spokesperson of the investigating team from Forest Watch Indonesia. "This blunder left few incentives for further improvement by the company. It also makes white-washing of illegal timber very easy."

The principal objections to certification of Diamond Raya (illegal logging and social conflicts) result from disputes with local people from surrounding villages. These disputes, relating to the boundaries of the concession and the way the company has dealt with local communities, surfaced in the 1990s. Arus Mujijat stated: "There are no land tenure disputes in the Diamond Raya Timber concession according to the provincial governments." The SGS Qualifor Assessment notes that "the level of social impact on the local communities is low, there are no villages within the concession boundary and access to non-timber forest products is not restricted."

But many advocacy groups disagree. "As an organization concerned principally with the rights of indigenous forest people, we are particularly concerned about land tenure issues in the Diamond Raya concession area," announced Simon Counsell, Director of the Rainforest Foundation. The controversy is not limited to Diamond Raya operations, but rather is a national issue. A letter by 134 Indonesian non-governmental organizations in 2001 disputes the entire concept of forest concession certification in Indonesia, as it is "counterproductive to securing indigenous and community rights to forest land." The letter, therefore, "reiterates the call to Lembaga Ekolabel Indonesia and the Forest Stewardship Council for a halt to all (certification) activities with concessionaires."

Martua Sirait, a researcher from the World Agroforestry Centre, clarified the argument: "Due to incongruities in implementation of Indonesian legislation, the majority of forest lands have been improperly classified as state land. Also, concessions are granted for a period of 20 years, whereas at least 35 years are necessary for effective implementation of the Indonesian Selective Cutting and Replanting System. As a result, forest concessions granted by the department lack the necessary land tenure rights to properly implement sustainable forest management."

The reforms proposed by environmental and social advocates include delineation of indigenous lands, modification of the forest concession system and promotion of community-based forest management. In advocating the use of certification to achieve a more democratic system of land rights, yet another controversy has been added to forest management in the Diamond Raya concession.

Lately, the disputes among these long-term adversaries have subsided. However, new groups have gained prominence in the controversy. For instance, the Ministry of Forestry recently shut down a certified concession, which many believe has seriously undermined the certification movement. However, while the various roles the Indonesian Government plays in certification have yet to be fully analysed, it is clear that the actions of such a prominent stakeholder will add further uncertainty to the situation.

Future of certification

Meanwhile, Arus Mujijat compared certification to a difficult variation of panjat pinang. Pinang - the Indonesian equivalent of pole climbing, consisting of a 10-metre high, greased pole with generous gifts at the top. The normal version is staged during national festivities, and players aim to work together to reach the prizes at the top. Arus Mujijat wryly remarked that the certification variation did not include cooperation between the players: "Every time you almost reach the prize, someone will pull you down again."

Undoubtedly, this perception of certification is now common among forest concessionaires in Indonesia. In fact, most forest companies do not consider certification as an opportunity. "Certification is presently laden with disincentives for forest concessionaires in Indonesia," acknowledged Daru Asycarya from Lembaga Ekolabel Indonesia.

But despite myriad criticisms, accusations and distrust, Diamond Raya Timber continues to improve its management practices. As Arus Mujijat emphasized: "We have to uphold our long-term commitment to the management of the concession. Our first priority was to improve the production aspects up to certification standards. Now we focus on improving the environmental and, particularly, the social aspects of concession management. We actively cooperate with several NGOs to improve the social standing of our company."

Clearly, Arus Mujijat has little doubt that the company is capable of sustainable forest management in the concession, and will continue to be certified in the long term. "Diamonds are forever," he grinned.

Bibliography

Forest Stewardship Council. 2003. An FSC analysis of the Rainforest Foundation report "Trading in Credibility". Forest Stewardship Council, 27 February 2003.

FWI/GFW. 2002. The state of the forest: Indonesia. Bogor, Indonesia, Forest Watch Indonesia, and Washington, DC, Global Forest Watch.

Rainforest Foundation & WALHI. 2001. Environmentalists challenge "ecotimber" go-ahead for logging in endangered tiger habitat; Important test case for Forest Stewardship Council; consumers could be misled by 'green' scheme, press release of 11 July 2001.

Selected internet sites

5Tigers: http://www.5tigers.org/AllAboutTigers/Subspecies/sumatran.htm
CITES: www.cites.org/eng/notifs/2001/040.shtml
Forests.org: www.forests.org/recent/2001/fsccertt.htm
ITTO: www.itto.or.jp/newsletter/v10n1/2.html
WWF: www.worldwildlife.org/wildworld/profiles/terrestrial/im/im0160full.html

About the author

Bart W. van Assen studied tropical forestry at Larenstein International High School and Wageningen University. He was formerly the regional representative in Southeast Asia for the Dutch Institute for Agro-Technological Research (ATO). Later, he worked for various firms on long- and short-term assignments, including the Indonesian Ecolabelling Institute (Lembaga Ekolabel Indonesia), the Seram Development Corporation (Indonesia) and SBW Consultancy & Research (Netherlands). He is currently on assignment with Global Forest Watch, based at the World Agroforestry Centre in Bogor, Indonesia.

Low-impact timber harvesting in the PT Diamond Raya Timber concession (courtesy Herman Syah, Arus Mujijat).

High-technology approach to forest plantation characterizes the forest management of the Timbercorp Forestry (courtesy Ian Bail).

Timbercorp Forestry: attention to detail pays off

Jacki Schirmer

Aaron Soanes, Treefarm Operations Manager for Timbercorp Forestry, walked between rows of one-year-old blue gum (Eucalyptus globulus) trees while a strong wind blew overhead. "They're growing well," he said of the trees, most of which were already far taller than himself. He was visiting this property to examine the health and growth of the trees, and to discuss leasing further areas of land from the property owner for future tree farm expansion.

This tree farm is near the town of Hamilton in southwest Victoria, and there are many others like it nearby. They have been established on land previously used for other agricultural enterprises, primarily grazing. In both the "Green Triangle" region of southwest Victoria and southeast South Australia, and in the southern part of Western Australia, large areas of blue gum have been established over the past 10 years by a number of companies.

Plantation companies have had to develop many skills since tree farms began being established on a large scale in the early 1990s. As one of the leading plantation companies in Australia, Timbercorp has been continuously developing improved establishment and management methods, as well as learning how to be a good neighbour in the rural communities where it establishes tree farms. The seemingly innocuous rows of trees Mr Soanes was examining have been the subject of considerable controversy in many rural communities, where the introduction of tree farming has not always been viewed favourably.

"I guess that, before tree farming was introduced to agricultural landscapes, foresters in Australia didn't often interact with rural communities. We've had to learn a lot very quickly about being a good neighbour," Mr Soanes stated.

Timbercorp Ltd.

Timbercorp Ltd is currently Australia's largest agribusiness investment management company. It raises capital from investors through managed investment funds, and uses the money to establish and manage tree farms, olive groves and almond plantations on behalf of its investors. Timbercorp Forestry, a subsidiary of Timbercorp Ltd, establishes and manages blue gum tree farms in southwestern and southeastern Australia. Timbercorp has expanded rapidly from its first planting of 1 000 hectares of blue gums on farmland in 1991. The company currently manages over 70 000 hectares of blue gum plantations.

In January 2003, Timbercorp began harvesting its first eucalypt plantations, producing woodchips for export to Japanese customers. This first harvest was a milestone for the company.

"Our investors have long awaited this event," said Robert Hance, the Chief Executive Officer of Timbercorp. "It demonstrates in the most tangible way that Australian plantation hardwood chips are in demand and that projected investor returns can be achieved."

Since the early 1990s, the area of eucalypt plantations established by the private sector in Australia has expanded considerably. This has been a result of policies such as the 2020 Vision for Plantation Forestry - a joint agreement between Commonwealth and state governments and the forest industry launched in 1997 - which sets a goal of trebling the area of plantations in Australia by 2020. Plantations have also expanded because many view them as a "green" environmentally friendly investment which helps to revegetate previously cleared land.

Timbercorp has aimed to be a leader in the field of eucalypt plantation management in Australia, since it started planting trees in 1991. When Aus Industry - the Australian Government's business assistance agency - awarded Timbercorp an "Innovation Certificate" in 2002, this was recognition of the company's commitment to research and development. "This Innovation Certification acknowledges the multi-million dollar investment Timbercorp has made in research and development to improve the returns to our growers and shareholders," Mr Hance explained.

Best practice

Timbercorp promotes plantations as a sustainable investment option to prospective investors - and the company has to ensure it lives up to this promise.

It needs to produce an economically competitive product that provides investors with a financial return, as well as ensuring it does so in a sustainable manner. This requires that Timbercorp constantly updates its practices - to reflect changes in knowledge and understanding of what constitutes "best practice." Learning from experience, and changing practices when existing methods are shown to be outdated or inadequate, have been core parts of the company's approach to improving plantation management. The company's approach to achieving best practice is centred on sound and appropriate technology.

"New technology is something all our staff are involved in - and it's a key part of doing the best for our investors each day we're out on the farms," Mr Soanes said.

Timbercorp uses a combination of staff training, research and innovation, and independent certification of practices to achieve management improvement. The focus is on developing technological solutions to solve management challenges in an economically efficient, environmentally sustainable and socially acceptable manner.

In particular, Timbercorp's management strategies are based on the principles of precision farming. Precision tree farming can be defined as the matching of the application of resources and silvicultural practices with site attributes and the requirements of the tree crop, as these vary within and between farms. In other words, precision tree farming means applying the right management at the appropriate scale.

To understand Timbercorp's approach to best management practices, it is necessary to look at the practices employed at the various stages of growing and harvesting a tree farm.

Seed collection

The seed used to grow Timbercorp's trees is grown and collected in seed orchards owned and managed by the company. The Southern Tree Breeding Association (STBA), a cooperative research group of which Timbercorp has been a long-term member, produces the seed being used.

Timbercorp decided to own and manage its own seed orchards because of the importance of high-quality seed for overall operations. Ian Bail, project manager of Timbercorp Technologies, a division of Timbercorp, believes this degree of control is necessary. "This is an area that requires long-term investment and direct management, to make best use of advances in tree breeding and production," he stressed.

Once seed has been collected, cleaned and graded for size and specific gravity, it is delivered to nurseries that are contracted to grow the seeds into seedlings. The nurseries are provided with detailed specifications on how the seedlings are to be grown. Regular quality assurance checks are carried out to ensure seedlings are being grown to specified standards. Plants are rejected if they do not meet defined standards for factors such as height, diameter, root development and nutritional status.

Timbercorp uses the latest research to improve the specifications given to nurseries. In 2000, for example, Timbercorp conducted a collaborative research trial with the Cooperative Research Centre for Sustainable Production Forestry on physical and nutritional aspects of blue gum seedlings. While all seedlings grown in the trial met current "industry standard" quality specifications, there was wide variability in actual seedling quality. The study examined the differences and found that initial nitrogen status and the container type used to grow seedlings significantly affected growth. Timbercorp decided to incorporate this knowledge into its seedling production.

"We incorporated the new specifications as part of our requirements for contracting nurseries," noted Mr Bail. "In the field, seedlings selected based on these new specifications showed a significant increase in growth - sometimes up to 40 percent volume growth over those planted previously."

Selection of sites for planting

Careful selection of appropriate land for its tree farms is one of Timbercorp's priorities. The company has developed a land selection process based on a combination of scientific knowledge, spatial mapping and flexibility.

To be eligible for use as a Timbercorp tree farm, land must have been cleared of native vegetation for at least five years. This restriction aims to ensure Timbercorp does not provide incentives for landowners to clear native vegetation. Timbercorp also has a policy of leasing land, rather than purchasing it outright, wherever possible. "It's better for us financially and better for the community," Mr Bail pointed out.

Members of some local communities have expressed concerns about new tree farms being established in their areas. These have ranged from concern over the social impacts of plantations replacing other agricultural enterprises, to apprehension over aerial spraying of chemicals on plantations. Concerns over loss of population have been expressed where land has been purchased, rather than leased, since it is common for previous owners to move off the land when it is sold for tree farming. When only part of a property is leased, the landowner often continues grazing or cropping on the remainder.

When landowners call Timbercorp, to enquire if their land might be suitable for tree farming, the company uses a careful screening process. Timbercorp has developed a spatial mapping system in which a range of characteristics relevant to tree farming - including climate, geology, topography, existing vegetation, and distance to port - are mapped. These characteristics are used to determine a land-capability rating which identifies areas that meet Timbercorp's land criteria. The initial investment in developing this spatial system has rapidly resulted in savings by reducing the amount of time spent investigating land. Up to a third of enquiries are rejected immediately because the land is located in an area classed as unsuitable according to Timbercorp's criteria.

If the land is not rejected at the initial screening stage, Timbercorp sends staff to physically inspect the property. Timbercorp employs several soil scientists and they work to identify various soil types on the property. The productivity of different soil types is calculated and averaged across the property to determine whether overall productivity is sufficient, and whether the land is otherwise suitable for tree farming. This rigorous site-selection process ensures Timbercorp can grow the highest quality plantations and thereby maximize returns to its investors.

Once land has been chosen for tree farming, the operational planning for establishing the tree farm can begin. One of the first priorities for Timbercorp is to talk with the people who previously managed the land, to find out as much as possible about potential land management issues that may be faced. A simple conversation with the previous land manager can result in significant cost savings.

Plantable land

One of the first priorities is to identify the "plantable land" on each new tree farm. There are usually areas that will not be planted with blue gums. These may be areas where planting is not allowed under government legislation, or under voluntary management guidelines such as those established by the Forest Stewardship Council, an international organization that sets standards for certifying forest management practices. Non-plantable areas include remnant patches of vegetation, which the company protects and actively manages to preserve habitat and environmental attributes. Riparian zones must also be protected by establishing buffer zones between the edges of the tree farm and any waterways that pass through.

Once the plantable area has been identified, Timbercorp maps out individual "woodlots" (ranging from 1 to 1.2 hectares in size) that are identified as "belonging" to individual investors. The plantable area is identified on a map - with woodlots demarcated - to facilitate the process of obtaining necessary planning approval.

The types of activities for which permission is required vary between local governments. For example, in some regions Timbercorp might need to seek approval to establish the tree farm. In others, it may need only to have a fire management plan approved by relevant authorities.

Initially, Timbercorp had no formal policies or staff training for interacting with local government and other authorities. The company did not actively communicate with local governments about its activities until required to by planning processes. Over time, however, Timbercorp has learned a great deal about improving communication and interacting with local government, effectively turning the situation around.

Various concerns

A lack of effective communication initially contributed to a sometimes combative and aggressive atmosphere in which disagreements occurred between Timbercorp and local authorities. Local governments were hesitant to give approval to activities that were causing considerable concern in the local community, and believed Timbercorp was not adequately responding to community concerns.

Mr Bail reported that Timbercorp did not realize how difficult it was for local communities to get information about the plantation industry: "Ignoring people and assuming they know all about forestry is a really bad plan. We didn't realize it, but people didn't know or understand enough about what we were doing. If you want to be a long-term manager you need to invest in getting community understanding of forestry."

Bill Luke, a Shire Councillor for the Victorian Shire of Moyne, in western Victoria, when Timbercorp began establishing tree farms in the region, has firsthand experience of the problems. Members of his local community brought him many concerns about plantations, but he found it difficult to get information that would help him analyse and come to a decision about plantation impacts. Meanwhile the local government felt it was not adequately consulted about what constituted a major land-use change in the region. "Local government felt disadvantaged - we seemed to have little or no control," he explained.

As communities expressed concerns through the local media and at local meetings, Timbercorp became aware that its lack of adequate communication was contributing to poor community perceptions of its business. Since that realization, the company has actively incorporated a range of communications initiatives and actions into its management programme.

Improved communication

At the local government level Timbercorp has worked to build relationships with representatives that allow exchanges of views in a productive, rather than combative, manner. Timbercorp ensures it gives local government advanced information of activities and plans - inviting local government for discussion sessions to review its plans and answer questions about particular issues. By taking local government representatives and employees into the field and explaining the rationale behind its tree-farming activities, Timbercorp is improving knowledge and understanding of its business. Local government, in turn, is enabled to make better-informed decisions about the tree farm industry.

Better communication has been effective in improving relations and has resulted in improved management. Mr Luke has seen this change clearly: "There are still a few ups and downs, but Timbercorp has been prepared to acknowledge and address issues and I think the community and local government have responded in kind."

Mr Bail agreed: "We tell people why we're here, we tell them what we're doing and we demonstrate that we're here to stay. Now that we're doing this, people are prepared to ask us questions first - rather than just criticize."

Timbercorp has learned that good management is not just about implementing the best practices in the field - it is about ensuring people are informed so they understand the company's business objectives and practices. This allows others to make informed decisions about Timbercorp's business, as well as to suggest areas for improvement.

"It's a two-way street," Mr Soanes noted. "We learn a lot of methods for improving our practices from other organizations, and opening ourselves up to that is very important."

Internal planning

Timbercorp's operating procedures are specified in a Standard Operating Manual (SOM) that prescribes best practice guidelines for all aspects of tree farm establishment and management. The SOM ensures that existing knowledge about best practices is communicated to all staff, and consistency of standards is achieved right across the company's plantation estate.

SOM procedures are applied to all of Timbercorp's operations nationally, and thus need to be flexible enough to adapt to the range of situations where Timbercorp establishes plantations. Every tree farm has unique management challenges and Timbercorp's plantation estate is spread across three different states - Victoria, South Australia and Western Australia. Each state has different land management legislation and regulations. Moreover, individual local governments also apply different planning regimes.

The SOM has been designed so it can be constantly updated to reflect the latest knowledge on best-management practices. Mr Bail is closely involved in ensuring that the SOM is adaptable. "The way that we carried out Quality Assurance checks three years ago was different to procedures two years ago - and different again, last year. We are constantly looking at new research and the results of our field practices, and changing systems where needed."

For every operation on every tree farm, a job-safety analysis and an environmental impact assessment (EIA) are undertaken. The job-safety analysis identifies all potential safety risks for operators on the property. The EIA identifies all the environmental sensitivities on the property that need to be taken into account in operations. All staff and contractors are made aware of - and are required to sign an agreement to manage the tree farm with regard to all health and safety hazards and environmentally sensitive areas on the property. Quality Assurance checks are used to ensure compliance.

Quality control

The company's Quality Assurance systems apply both to contractors and to activities undertaken directly by Timbercorp. Contractors are trained in Quality Assurance approaches and are required to self-check their own activities, while also being monitored by Timbercorp staff.

For example, Tony Roache and Mick Fallon are the owner-operators of Accurate Agriculture Pty Ltd, a company that currently derives approximately 75 percent of its revenue from contracts for weed control with Timbercorp. "Timbercorp is very demanding with its contractors," Mr Roache explained. "The company's quality control systems are first class, ensuring that we work to tight guidelines with a high-quality result."

Once site preparation activities are completed, it is time to plant. Planting is a critical moment, as Mr Soanes observed: "The 2 or 3 seconds it takes to plant a tree can make all the difference 10 years later."

Mr Bail agreed: "We spend a lot of time ensuring we have the highest quality seedlings and highest quality site preparation. The time when we bring these together - at planting - is critical."

Planting contractors are carefully trained in tree-planting techniques, and self-check their work. Timbercorp staff then conduct Quality Assurance on the tree planting. Timbercorp ensures it discusses with contractors not just what it wants them to do, but why it is important. Mr Soanes indicated that the best systems for Quality Assurance will not work unless all staff and contractors know why it is important to do things in a specified way.

"When people can see a better result from implementing a new practice, they are willing to keep doing it - and to keep looking for innovation. You have to make sure the people are the most important part of the system, not the technology," said Mr Soanes.

Once the tree farm is planted, it must still be managed for 10 years before being harvested for woodchips. A first task is to ensure that there is adequate seedling survival. The newly planted tree farm is inspected at a minimum of every seven days after planting, and two months after planting a survival count is done. Any necessary replanting is undertaken.

To achieve a high quality final crop the trees must be monitored and, where necessary, treated to manage pests and nutrition during the 10-year rotation. Timbercorp has developed a system for monitoring and managing its plantations that combines the latest technology, research and development, and staff training.

To achieve maximum growth rates, the trees need correct nutrition. One year after planting, leaf samples are taken from farm stands and analysed to check if the trees have adequate levels of key nutrients such as copper. This nutritional sampling is a key component of Timbercorp's Quality Assurance process. It identifies any nutrient deficiencies at a point in the growing cycle where these can be easily treated with fertilizer applications, so that growth problems can be corrected.

Timbercorp has developed a highly innovative system for collecting and analysing nutrition information. This system has been so successful that Timbercorp has since expanded its use to a range of other field-based activities.

Geographic positioning system

Timbercorp staff are issued with hand-held Palm^TM personal digital assistants (PDAs), which are linked to hand-held geographic positioning system (GPS) receivers that can provide spatial coordinates for any geographic location. Field staff locate sampling points with exact geographic coordinates given by the GPS receivers, and record these in the PDAs. Leaf samples are collected and taken for analysis. Back at the office, data are uploaded from the PDAs into the central computer system. The data are automatically entered into a database linked to a spatial mapping system. Once the results of the sampling are produced, it is possible to display on a map the nutrient status of all the sample points.

Intensive management of tree farms produces impressive yields (courtesy Ian Bail).

Pest management

Timbercorp has also made use of the new technology in its pest management programme. Using the PDAs, and results of the latest research on pest populations and management, Timbercorp has developed decision-support software to determine the type of pest management needed. Staff regularly carry out sampling surveys for particular pests. At each sample point, they enter any signs of pest activity into the PDAs. The software processes the information and provides instruction on whether more sampling should be carried out, or if management to reduce pest activity is needed. The system is very cost efficient and greatly reduces the time spent on pest management, both in the field and in the office. It also ensures pest control is undertaken only when necessary.

Methods of pest management in plantations have been a controversial issue in some regions, with local communities expressing concern about the use of aerial spraying of insecticides in particular. Timbercorp is responding to concerns about the use of chemicals by funding and undertaking research into alternative methods of pest control. Using systems that reduce or eliminate the need for chemicals is an important goal for the company for both environmental and economic reasons. Timbercorp is working towards certification of its operations by the Forest Stewardship Council, whose principles and criteria for sustainable forest management include an ultimate objective of no chemical use.

Timbercorp has had success in developing new pest control methods in conjunction with the Commonwealth Scientific and Industrial Research Organisation (CSIRO), Australia's main scientific research agency. For example, in Western Australia, the African black beetle is a common pest of young seedlings. The beetle, which effectively "ring barks" the seedling by eating away at its base, has caused hundreds of thousands of dollars of damage to young eucalypt plantations each year. Timbercorp originally applied insecticides to control the beetle. However, research trials undertaken by Timbercorp and CSIRO found that placing a small mesh sleeve around the base of each seedling prevented beetle damage in almost 100 percent of the seedlings.

"This is a very exciting outcome!" exclaimed Dr James Bulinski, a member of the Timbercorp Technologies group and one of the key researchers on the project. "It means we now have a very effective way of stopping beetle damage without having to use chemical insecticides."

He also believes using research partnerships is a valuable way of achieving practical research outcomes. "People often don't realize that commercial tree farming companies like Timbercorp are working with research organizations such as CSIRO and really putting a lot of effort into developing cost-effective alternative approaches to pest management."

Land management

While Timbercorp has improved consultation with local governments, it has also worked to improve its consultation and interaction with its neighbours. Timbercorp works collaboratively to ensure its activities do not have adverse impacts on neighbouring landholders. Timbercorp maintains a database of the types of land management activities undertaken on land neighbouring its tree farms. Where neighbouring enterprises may be sensitive to particular activities, Timbercorp tries to find mutually acceptable management solutions. For example, Timbercorp will use a different chemical regime on tree farms bordering aquaculture enterprises, because some chemicals have the potential to adversely affect the fish. Before any operations are undertaken, neighbouring landholders are informed, and given contact details of Timbercorp staff to call with any concerns or queries.

Timbercorp has found that early consultation and discussing the company's plans with neighbours has reduced concerns about its activities. For example, Timbercorp uses aerial topdressing to apply copper because young trees absorb the element more readily through leaves rather than roots. Timbercorp's consultation policies now inform neighbours ahead of time about planned aerial fertilization and it has noticed a sharp drop in the level of expressed concerns. Consulting and informing before activities are undertaken have helped the company build trust in the local community.

Linkages with other organizations

Timbercorp and Greening Australia, a revegetation organization, have joined forces on one tree farm in western Victoria. The Nigel Tree Farm has a large riparian zone, which had very little native vegetation cover when Timbercorp established the tree farm. Timbercorp and Greening Australia combined efforts to use direct seeding to achieve revegetation with a mix of native plant species in the riparian zone. This project allows Timbercorp to manage an area of land that might otherwise have become invaded by weeds; to develop the area to provide wildlife habitat and corridors; and to keep the waterway in good condition.

"The work forms part of the Greater Glenelg Biolink, a Natural Heritage Trust-funded project, which is connecting remnant vegetation across the landscape," explained Dave Warne, of Greening Australia. The Natural Heritage Trust is a government-funded trust that provides funding to help restore natural vegetation across the Australian landscape.

On another property, Timbercorp has restored a wetland area by rebuilding a natural dam in an area that was drained by the previous land manager and assisting regeneration of native vegetation.

Timbercorp is currently revegetating 300 hectares with native species in a number of areas. The company prefers to work on revegetation projects in partnership with other organizations. These include local Landcare groups, which are groups of land managers and members of the rural community that undertake environmental improvement.

Harvesting methods

After 10 years of growing and managing blue gums, the first harvesting began in January 2003. The company has placed a strong emphasis on the development of harvesting systems that are sustainable and that maximize returns to investors. An in-field processing system that has been co-developed by Timbercorp provides a good example of the use of research and development to address economic, environmental and social challenges in plantation harvesting.

Timbercorp faced two highly significant challenges in developing its harvesting system:

• Plantation growers have traditionally sold trees as unprocessed logs. Timbercorp recognized that if it developed a system to process logs into woodchips before sale, this would increase returns to investors. The challenge was to develop an economically efficient woodchipping system.

• Log transportation was another challenge. Establishing a network of roads within a tree farm to support harvesting is very expensive. It was, therefore, extremely important that the harvesting system minimize the extent of road construction within plantations, while also reducing impacts on external roads.

Timbercorp has developed an on-site woodchipping system to meet these challenges, as well as ensuring the entire harvesting system utilizes best practices to minimize negative environmental impacts.

When trees are harvested, the bark, leaves and small branches are left at the harvest site as slash. This allows recycling of the nutrients back into the soil. It also enhances soil stability and reduces post-harvest erosion risks.

Logs are left in whole-tree lengths and taken by a forwarder to the edge of the plantation, where a specially designed machine chips them directly into storage containers. The closed containers are transported by truck to port, ready for export. About 120 trees can be harvested and chipped every hour.

Tim Browning, General Manager of Forestry for Timbercorp, indicated that the efficiency gains are significant. "This harvesting system adds 40 percent to grower returns over conventional systems," he observed.

Robert Hance explained the advantages of a mobile in-field chipping system: "Each time we install a chipping machine it works flat out from day one. A million-tonne static mill takes many years to become efficient and over time gets further away from the forest. Our operation is efficient from day one."

By taking on the harvesting process itself, Timbercorp has captured another stream of revenue for its investors that otherwise would have gone to external contractors.

Timbercorp is committed to using external certification processes to achieve best practices. In 2001, its Forestry Division's environmental management system was accredited under ISO14001. ISO certification focuses on ensuring that the management processes used are appropriate, and Timbercorp was able to improve its Quality Assurance systems significantly through the accreditation process. The process also encouraged development of improved consultation and communication with the community.

Currently, Timbercorp is working towards achieving certification under the Forest Stewardship Council (FSC) programme. FSC certification is granted after an audit process to assess a company's ability to maintain a well-managed forest. A pre-certification "gap analysis" has been completed for Timbercorp's operations, and has identified areas needing improvement before FSC certification can be granted. The next stage entails an audit by an FSC-sanctioned certifier to determine that the identified improvements have occurred. Gaining FSC certification will be an important verification that Timbercorp is achieving sustainable outcomes in its tree farm management.

Future challenges

Timbercorp faces a number of challenges as it expands to harvesting operations. The issue of road maintenance and safety is becoming particularly challenging. Rural communities are worried about the increasing number of log trucks on the roads.

Bill Munro, the Mayor of Glenelg Shire in Victoria described community concerns: "They are worried about the potential for damage to the roads, their own safety on the road, and about the potential for noise and pollution. This is a problem faced not just by Timbercorp, but by the plantation industry in general."

The town of Portland, from which woodchips are exported overseas, is in Mr Munro's Shire and, as tree farm harvesting expands, he has to plan for increased truck movements on both major and minor roads.

Local government is also concerned that it has to allocate scarce funding to upgrade roads used by the plantation industry. Developing solutions to the challenges of road maintenance requires negotiations among local government, the plantation industry and other road users.

Similarly, there are other large-scale issues with the tree farming industry that are still to be resolved. These include ensuring that local government has the appropriate skills and resources to effectively monitor the management activities it is required to regulate on tree farms. These types of challenges cannot be solved by Timbercorp on its own, but require a consolidated approach from the entire industry and other stakeholders.

"For some of these issues there are no easy answers," said Mr Bail. "We need to work together to develop answers to some of the challenges that result when a new industry grows as rapidly as this one has."

Aaron Soanes, inspecting the one-year-old tree farm near Hamilton, is confident that Timbercorp will find solutions to existing and future challenges.

When asked what the key elements of Timbercorp's future success will be, he affirmed: "As long as we have the right processes in place, and we're willing to listen to people within and outside the organization - we'll keep on improving and changing when we need to."

About the author

Jacki Schirmer is a researcher at the School of Resources, Environment and Society of the Australian National University. She has worked for several years examining the ways in which improved processes can be developed to productively transform conflicts over the management of plantations in Australia, the United Kingdom and Ireland.

Forever Beech Limited: forest management at the cutting edge

Chas Perry

How do people set about cutting and marketing indigenous timber when it seems nearly everyone in the country is opposed to the harvesting of natural forests? This is the challenge that has faced owners of natural forests in New Zealand since the 1990s.

Forever Beech Limited (FBL) was established as a private company in July 2000, on the West Coast of the South Island, specifically to tackle this daunting challenge.

"FBL was formed to provide the necessary infrastructure and knowledge to enable private landowners to manage their indigenous forests sustainably," explained Kit Richards, Forever Beech's business support manager and former director of the original company, Forever Ltd. "This was subsequent to the government's decision to halt all indigenous timber harvesting on publicly-owned (Crown) land," he added.

At present, more than 99 percent of New Zealand's timber harvest comes from exotic species plantations, with only very small volumes of indigenous timber such as beech (Nothofagus spp.) and rimu (Dacrydium cupressinum) being harvested from privately-owned natural forests. FBL was formed to ensure that private owners of natural forests could continue to cut and harvest indigenous timber by applying the highest standards of management.

Critical to the vision behind FBL was the recognition that the country would continue to consume high-value timber (for furniture, cabinetry, etc). Such wood would have to be imported unless a recognized and credible process - from the forest to market - could be established for the use of indigenous timber. FBL recognized that sustainable management of beech forests on private land was in its infancy; forest owners lacked the necessary skills and had little experience. There was also a general lack of understanding of the concepts and practices of sustainable selection forestry techniques in a nation where the focus of timber production has been on exotic plantation forestry for many years.

The founders of FBL wanted to create a leading-edge entity, specializing in high-quality beech timber produced from privately owned forests, under government-approved sustainable management systems. The idea was to establish a small pool of experts with proven experience and knowledge in managing beech forests to provide advice to forest owners who lacked knowledge, skills and the necessary capital to implement sustainable harvesting in their tracts of indigenous forests.

"When we went to the landowners initially, we had little more than a concept to offer them," said Mr Richards, who has 25 years of experience in both exotic and indigenous forestry on the West Coast - and the backing of other highly experienced colleagues with similar backgrounds.

Turning the concept into reality has not been an easy process and there are still major challenges, especially in the branding and marketing of the timber products. Despite these challenges, FBL has the potential to lead the rebirth of sustainable indigenous forestry in New Zealand.

Brief forest history

To understand fully the potential and size of Forever Beech operations, it is necessary to have some knowledge of the forest industry in New Zealand. During the 1920s and 1930s, the New Zealand Forest Service started planting large-scale forests of exotic trees to supplement indigenous timber supplies. Planting continued over the years - both by the government and the private sector - to the point that by 2000, more than 1.7 million hectares of exotic plantations had been established. Changing attitudes, increased environmental awareness and the presence of these substantial exotic forests led to increased public opposition to the commercial harvesting of publicly-owned indigenous forests.

The harvest from indigenous forests has declined from 1.6 million cubic metres of logs per annum in 1960^[29] to about 41 000 cubic metres in 2003.^[30] More than 82 percent of the country's 6.3 million hectares of indigenous natural forests are now in strict conservation reserves. Following major structural changes in the New Zealand forestry sector from 1987 onwards, the West Coast of the South Island was the only region of the country in which logging of publicly-owned indigenous forest was taking place. In September 1999, the government finalized its indigenous forest policy, which brought an end to all logging of publicly-owned indigenous forest, including the limited logging in the West Coast.

Consequently, FBL was established in a commercial environment in which the vast majority of forestry expertise and production was concentrated on plantation forestry. The pattern for the past 30 years was one of declining natural forest harvests and increasing regulation - eventually leading to the government's total withdrawal from commercial harvesting. The fledgling FBL had expertise, enthusiasm and a vision of sustainable and profitable indigenous forestry, but equally, it was short on capital and faced with the daunting challenge of re-igniting an industry that had been in decline for a long time. The new company was struggling when the West Coast Development Trust lent a helping hand.

West Coast Development Trust

In 2001, the gover nment provided the West Coast region with a NZ$120 million (US$70 million) "Adjustment Package" in recognition of the loss the region would suffer as a result of the government's decision to stop timber production from publicly-owned indigenous forests.

From the package, NZ$92 million (US$53.5 million) was vested with the West Coast Development Trust, while NZ$7 million (US$4 million) was given to each of the region's four local authorities. New enterprises were invited to seek funding from the Trust for the establishment and development of businesses in the region.

The West Coast Development Trust invested NZ$3 million (US$1.7 million) into Forever Beech as one of its regional development initiatives and became the major shareholder. The company also has seven individual minority shareholders.

"The original company had been seriously undercapitalized from the outset," explained Frank Dooley, the West Coast Development Trust Chairperson. "Our investment injected enough capital to move forward, to hire experienced staff and to purchase a specialized mill for sawing beech logs. We are now confident that the industry has a real chance of succeeding on the West Coast."

The Trust appointed three outside directors to FBL, including its Chairperson - Auckland entrepreneur, Peter Coakley. FBL is expected to sustain heavy losses in 2003 before turning a profit in 2004.^[31] This is because of the time required to dry and season beech timber, and a measure of the marketing challenges facing FBL.

For many New Zealanders, beech timber is a new product and it will take time for it to gain acceptance in the market. Beech has long been recognized as a fine timber, but it is only with recent advances in technology and research in sawing, drying and finishing that beech has become competitive in the fine timber marketplace. A distinguishing feature of beech timber is its exceptional dimensional stability. The tightly grained wood is tough and durable, making it ideal for feature flooring, decorative applications and furniture.

Forever Beech performs key roles in bringing together interested stakeholders and coordinating forest management, harvesting, processing and marketing operations. Stakeholders include the landowners, government departments, local authorities, local communities, helicopter and transport operators, sawmillers, timber-drying companies, architects and the purchasing public.

The coordination of these numerous relationships and operational requirements by one company is a complicated task. Figure 1 shows the diverse spread of operators and stakeholders in relation to company operations.

Figure 1. Forever Beech Ltd. operations and stakeholders

Forest resources

Selected landowners were approached by FBL after an extensive filtering process. Satellite imagery, combined with cadastral mapping and local knowledge, was used to develop a shortlist of landowners whose forests were believed to meet criteria considered important for successful management.

A fully documented proposal was then formulated and presented to the landowners individually to determine interest and support. The selection process took two years, during which time the top 10 percent of eligible landowners were identified. Various issues were discussed and resolved, legal agreements concluded and landowners enlisted to ensure that adequate forest resources would be available to sustain the proposed enterprise. Most of the landowners who were approached to join the effort, eventually decided to participate.

Today, Forever Beech coordinates the management of a forest resource encompassing 22 landowners and a forested area of 5 600 hectares. About 80 percent of this area (4 500 hectares) will be used for wood production. The individual tracts of forest range in size from 48 to 580 hectares, with the average being about 250 hectares. As the concept has developed, several additional forest owners have expressed interest in becoming involved.

The forests are located in the districts of Buller and Tasman in the northern area of the South Island. They form a matrix of old growth and second growth beech forests strategically positioned between productive agricultural lands on the one side and large publicly-owned conservation (protected) areas on the other.

Important issues for landowners

Landowners stress that Forever Beech has provided them with an opportunity to add another dimension to their farming businesses and to earn additional financial returns. In an interview with The Nelson Mail, Russel Bailey of the Tutaki Valley near Murchison said the project would give him a chance to make a little bit of money out of land his family had been paying taxes on for 80 years.

Discussions with landowners highlight three key factors in building willingness to join the Forever Beech initiative. The first is the development of mutual trust between the staff of FBL and the landowners. This is extremely important, as the initiative entails long-term commitment by both parties, and the forest management, harvesting and marketing operations all require people with specific skills and experience. The second factor is assurance that the forest structure will be maintained with little or no visual change. This is achieved through helicopter logging and removal of only small volumes of logs. The final positive factor is that there is no up-front cost to the landowner. FBL provides all the inputs and expertise for preparing the requisite Sustainable Forest Management Plans, which include explicit prescriptions for managing landowners' forests.

Management plans

Each forest is managed individually under its own specific Sustainable Forest Management Plan, approved and registered in accordance with New Zealand's forest law (Part IIIA of the Forests Act, 1949). The plan specifies biodiversity conservation requirements, silvicultural approaches, harvesting plans and monitoring systems. These are all incorporated into a legal format and recorded with the District Land Registrar against the title of the property for a period of 50 years. This important measure demonstrates the long-term commitment of the landowners to sustainable management of the forest. FBL and the landowners also established "Registered Forestry Right" agreements covering 20 years. These agreements outline the rights of both parties with respect to management operations, access to forest areas, the level of royalty and timing of payments, reporting requirements and clauses relating to mediation and arbitration.

The landowner (not FBL) owns the plan, but it is developed by FBL staff who are experienced in the Part IIIA provisions of the Forests Act. The Act is administered by the Ministry of Agriculture and Forestry (MAF) and includes a requirement to consult with the Department of Conservation (the lead government agency responsible for conservation and biodiversity protection). FBL also consults with local authorities to ensure that all requirements for indigenous forest management activities under the Resource Management Act, 1991 are met.

Regional Department of Conservation staff in Nelson and Westland describe the management plans produced by FBL as detailed and demonstrating good understanding of ecological principles. Officials summarize that the FBL plans are of excellent quality and the best that the Department of Conservation has received; they set the standard.

The costs of all the initial management planning and forest assessment work add up to tens of thousands of dollars. The company recoups part of these costs at the time of the first harvesting operation.

Forest management

FBL forest management concepts arise from the experience gained by its staff as key participants in the development of sustainable forest management systems for the rimu and beech forests of the West Coast. As Kit Richards pointed out, "These management techniques, including helicopter harvesting, were developed and applied to publicly owned indigenous forests on the West Coast, prior to the decision to end indigenous logging on public lands."

The dominant forest species in the forests managed by FBL are red beech (Nothofagus fusca), silver beech (N. menzeii) and hard beech (N. truncata). FBL has focused on the red and silver beech forest associations, as they know from experience that seedlings of these species readily regenerate after harvesting and natural disturbance. Small proportions of podocarp species are also present, but landowners are being encouraged not to harvest these species for biodiversity reasons.

FBL's objective is to manage the forests using techniques and practices that retain the forest's natural structures, while at the same time producing a sustained annual yield of timber from the many landholdings involved. This will in turn provide a continuous flow of raw material for processing and marketing.

"Our approach is to mimic what happens in nature, where trees die singly or in small groups forming a naturally occurring gap in the canopy. This allows the new, light-demanding beech seedlings to grow," observed Jon Dronfield, Officer-in-Charge of Forest Operations for FBL. If the natural regeneration is judged to be insufficient, there is provision in the plans for planting seedlings to replace the harvested trees. Second-growth forests are usually simpler in composition and structure than old-growth forests.

Based on the forest structure data collected by FBL, experience and silvicultural objectives, decisions are made on which trees are to be retained and which are to be removed from within the harvest site. A specified number of old trees per hectare, especially those with dry cavities, are identified and reserved as "habitat trees." These are retained as an integral part of the forest structure and provide a crucial habitat for cavity-nesting birds. Trees hosting native mistletoe (Peraxilla spp.) are also retained and banded with sheet aluminium to protect this rare plant from browsing opossums.

Introduced pests such as opossums represent a major threat to the forest, so pest control programmes have been incorporated into several FBL plans.

The trees selected for harvest are all classified according to their reason for removal. For example, a tree may be harvested to create a gap ("a gapmaker") or selected as a harvest tree ("selection harvest"), or because it is already an "uprooted or windthrown" tree. Strict adherence to directional felling requirements for each tree harvested is protection against damage to existing seedlings and adjacent trees.

Only the marketable trunks of harvested trees are removed from the forest and these represent about 60 percent of the total biomass of the trees felled. The branches and foliage are left on the forest floor. Defective sections of logs are also left in the forest to provide valuable elevated sites that facilitate seedling establishment in areas of dense ground (fern) cover. On average, FBL removes 1.4 cubic metres of wood from the forest per hectare each year, while the total volume felled per hectare is approximately 2.3 cubic metres per year.

Helicopter harvesting

Helicopters are the primary harvesting tool of FBL and are also one of its key conservation tools. Helicopters have eliminated the need for roads within forest boundaries and their flexibility means non-target trees and reserve areas can be avoided. Reserve areas (not exceeding 20 percent of the total forest area) may be set aside as representative sites where logging is not permitted. With helicopter logging, there are almost no negative soil or water impacts, and the threat of pests entering forests along access roads is eliminated.

The use of helicopters and small-group-selection silviculture methods means that there is minimal visual change to the forest. This is because the helicopter enables very small areas to be harvested and allows the absence of access roads.

The average flying distance from the forest to landings in farmers' paddocks is only about 800 metres. Helicopter harvesting is, however, an operation where safety issues are always paramount. "It is critical that each log is accurately measured and the weight is correctly calculated," Jon Dronfield stressed. "The helicopters we use have a maximum lift of 1.5 tonnes, and we aim to consistently achieve 85 percent utilization or an average payload of 1.3 tonnes."

Mr Dronfield added that some helicopters have an electronic load cell to weigh each log, but it is still his job to ensure the logs are a safe weight. FBL has developed its own volume-to-weight conversion tables for the individual beech species, which relate to the areas they are harvesting. The use of pilot-operated grapples rather than ground-based attachment of strops has also increased safety during harvesting operations, as ground support staff do not have to be in close proximity to the logs being extracted.

To help pilots locate the felled logs to be transported, each log is painted with a large, bright red square. An experienced helicopter pilot can locate the logs and attach the grapple, while hovering as close as 10 metres above the tree canopy. The log can be extracted from the forest within a matter of minutes.

It took two years before landowners Brian and Marie Webby saw the first of their logs removed by helicopter. "At last we could see it all happening," recalled Mrs Webby. "We could not have gone through this long process ourselves and needed the experts to manage the forest and market the timber."

The couple describe themselves as semi-retired farmers who love their forest. They watched the Iroquois helicopter with its 30-metre wire strop and self-loading grapple pluck the prepared logs out of the small (0.03 hectare) clearing in the forest and deliver them onto the farmland below.

Every log sold can be traced back to its source tree and its location in the forest, because all logs are numbered and all stumps are tagged. The stumps are referenced carefully to a Global Positioning System (GPS) record.

FBL acknowledges that there is a range of views expressed by nongovernmental organizations on their operations. Some are very supportive of FBL's management approach, methods and conservation efforts, while others continue to oppose all harvesting of indigenous forests under any circumstances.

Data collection and monitoring

As part of the development of a Sustainable Forest Management Plan, FBL establishes permanent sample plots.

"These plots initially provide baseline data on forest volume, species and structure to guide management of the forest; they will be monitored at regular intervals over the duration of the registered plan to provide an ongoing picture of the outcomes of management," indicated Jon Dronfield.

FBL has also developed a register system for Flora Conservation Activity by Forest by Species. FBL's register sheets identify the forest, the important species found, relevant GPS coordinates, conservation status, the dates of visits to the site and prescribed conservation activities.

Annual logging plans are submitted to MAF for approval before work in the forest commences. FBL provides annual harvest reports to MAF and the landowner. The reports elaborate the allowable harvest of each species of tree, actual harvest, statistics on the height and diameter of trees harvested, the presence and height of regeneration at the time of harvest and full details on the number of gaps created, their size and their combined area.

"FBL's aim is to set the standard for the detail and quality of data it collects and makes available to the landowners and MAF. This data is used as part of the auditing of our operations and will be used in the future to monitor the growth dynamics of the forest," Kit Richards explained.

Forever Beech perceives one of its roles as helping people to learn about and understand their approach to forest management. The company has hosted a number of visits to their operations. These have included ecology students from the United States of America and students from the Canterbury University School of Forestry in New Zealand.

As the administrator of forest law in New Zealand, MAF has the primary role in approving management and logging plans and monitoring all forest operations. All forests are inspected prior to their Sustainable Forest Management Plan being approved. Post-harvest auditing of reports on species and volumes removed - along with in-forest inspections - are completed to ensure that operations have complied with the requirements of the Forests' Act.

Processing and marketing

In late 2002, there were major changes in the processing operations of FBL. The company's new Board of Directors decided to close down an old sawmill and milling operations were consolidated at the Blue Spur Road sawmill on the outskirts of Hokitika. This second-hand re-sawing mill was built in February 2000 specifically to process beech timber. Fine kerf sawing enabled the achievement of conversion rates from log to sawntimber of about 47 percent.

The newly sawn timber is transported 260 kilometres over the Southern Alps to Belfast Kilns Limited, near Christchurch on the east coast of the South Island. Here, it is first air-dried then brought down to around 10 to 12 percent moisture content in kilns. This process takes around four-and-a-half months for 25-millimetre timber, and up to nine months for 40-millimetre timber. It is then further processed into a full range of products including veneers, a range of lumber grades, mouldings, flooring, edge-glued panels and outdoor landscape products. The lengthy drying period is a major financial challenge, because considerable resources are tied up in drying stocks. However, this process ensures the timber produced is extremely stable when it reaches the market and is therefore suitable for a wide range of high-value, precision uses.

Future vision, opportunities and obstacles

Forever Beech is now in a position whereby it has secured a viable forest area to enable it to achieve its vision.

The landowners express faith in the approach being taken and the quality of the FBL staff. One landowner, Gary Basher, has 400 hectares of beech forest under a Sustainable Forest Management Plan and has had his first harvest completed by FBL.

"I like the professional approach of FBL, the experience they offer and the concept of looking at the whole forest system," Mr Basher stated. He recognized that FBL is still at the stage of getting started and is satisfied with the long-term approach being taken. Landowners recognize that FBL needs time to develop its markets and therefore have accepted a lower level of harvest in the initial stages.

But, the company is fully aware of the risks involved in developing a "sunrise" industry. FBL needs to move quickly to develop and expand niche markets if its survival is to be ensured.

"There are three challenges for the future: marketing, marketing and more marketing. We're happy with the forest management side of our operations and now marketing is where we need to focus our efforts," Mr Richards claimed. FBL has already reached the stage where it has a full range of product lines available. This is a major milestone.

Recently, FBL has developed a comprehensive Web site^[32] that provides details of their operations and products. The marketing team has demonstrated the products to architects, furniture manufacturers and building suppliers to promote awareness of the properties of beech compared with other species, and to reinforce the quality aspects of the timber.

The future is dependent on markets being aware of Forever Beech's products and having confidence in their use. The company's aim is to ensure the quality of the products is maintained and that the product will be available when required. The biggest obstacle is changing perceptions that beech is a low-quality, unstable timber - a legacy of the use of poorly dried beech timber in the past.

FBL is acutely aware of the challenges ahead. These include the high costs associated with helicopter logging (which are about eight times those for ground-based harvesting of plantations in New Zealand); transport costs; lengthy drying times; and the difficulties associated with marketing and promotion of a lesser-known timber. On the optimistic side, however, the company is producing a premium product derived from a natural resource with no establishment costs. Thus, the expectations of landowners regarding their returns reflect the early development stage of the operation.

The company's "search of excellence" includes forest management, environmental management, processing and marketing. All will need to reach a level of excellence for the business to be sustained "Forever."^©

About the author

Chas Perry is a Senior Policy Analyst with the Ministry of Agriculture and Forestry in New Zealand. He has experience in commercial plantation forestry, indigenous forest management and resource management planning. As a regional analyst, he provides the link between rural communities, the forestry sector and the government.

Red beech (Nothofagus fusca) (courtesy Ian Platt).