Farm forestry in the South Island high country: A case study

Abstract

Production forestry is a minor land use in the South Island high country. The limited extent of forestry is because of perceived market returns, the attitudes and knowledge of the present landholders, and institutional factors.

Present institutional restrictions are based on the historical perspective that pastoralism in the best high country land use rather than on an assessment of the relative costs and benefits of farming and forestry.

The study investigated the constraints to, and the implications of, the development of production forestry in the South Island high country. The emphasis of the study was on forestry developed in conjunction with pastoral farming.

South Island high country has been described, and its historical and present use has been reviewed. Factors which may influence the adoption of production forestry as a high country land use have been discussed.

Biological constraints limit some species and some management regimes, but ample opportunity exists for development of production forestry.

A financial analysis of a development programme on one farm was undertaken to explore the economic implications of forestry to the farmer. Advantages and disadvantages of forestry to the farm operation were considered.

Under the assumptions of the study, financial returns were not favourable. The uncertainty of future prices and the particular sensitivity of the analysis to price assumptions seriously lessen the worth of financial analysis as a criterion to justify planting (or not planting) trees.

In spite of the uncertain financial return, farm forestry was considered to be worthwhile because of benefits which were not included in the analysis (for example, shelter).

Future development of forestry may be encouraged by research into the costs and benefits of farm forestry, and by extension of existing information.

Institutional controls at both regional and national level restrict forestry. Farm forestry is the only feasible development option under present policies.

Implications of forestry development throughout the high country have been examined through consideration of three scenarios of forestry on different scales. The magnitude and nature of environmental, economic and social changes depend on the extent and rate of forestry development.

Cost benefit analysis is not an adequate means for assessing the net benefits of forestry development. The technique fails for two reasons. Firstly, the uncertainty of future prices makes resource use comparisons based on market returns of doubtful value. Secondly, many costs and benefits are not adequately described or valued by traditional cost benefit procedures.

In the absence of the data and methodology to enable more comprehensive analysis, forestry development decisions will continue to be made on a subjective assessment of costs and benefits through regional and national planning mechanisms.