Some historical data on stumpage rates in Nigeria is given in the two tables below.

This method of timber sale can be used to create public awareness, especially in areas without a forest estate. It also encourages the full utilisation of trees because, since all of each tree is paid for, the tendency is that the buyer will use as much of the tree as practicable in order to maximise profit. This, in a way, also has the advantage of protecting the environment by reducing the rate of exploitation of the forest. The tendency to protect the environmental is enhanced further by the use of a specified girth limit to restrict tree felling and ensure that vegetation is not unduly destroyed.

Timber sales based on stumpage value are less costly and easier to administer than other methods and require relatively limited person-hours to complete sales agreement. They also allow for direct public participation in the sale procedure, because the owners consent in writing is a prerequisite for the issuance of harvesting permit. However, this method requires a high degree of honesty on the part of both the buyer and the government officials who are administering the sale.

Fees based on out-turn volume (OTV)

This system is used for concessionaires who fell trees from concession areas without the use of the permit system. OTV requires the measurement and estimation of the actual volume of wood removed from the forest and, as such, is more precise than a per-tree fee, which does not consider differences in height and girth. The fee is based on the estimated volume of each log (calculated using approved tariff tables) in states like Ogun, Ondo, Oyo and Osun. The OTV method is also operated as pre-paid system in some states, where the total amount of fees has to be paid before wood is removed from the forest. This is done to prevent fraud and loss of revenue by the government.

Disadvantages. The main disadvantage of this method is that it is labour intensive and time consuming. For example, it requires a team of thirteen men and several person-days to conduct a proper OTV sale (Wamugimda, 1971). The system also encourages the over-exploitation of high value tree species and under-exploitation of lesser-known species, so it does little to encourage efficient forest management and utilisation. Producers harvesting wood under the OTV system are very selective in what they take in terms of species, size and the shape of trees, leading to under-utilisation of the forest. In addition, the bills for total fees (based on the measurement and estimation of volumes) are sent to the office, where the supervising officer is handicapped by lack of transportation to cross-check field information. This creates room for collaboration between field officers and contractors to defraud government. Many saplings are also destroyed under this system because of the extensive nature of harvesting (i.e. low harvesting intensity) that also often occurs under this system.

Advantages. Despite its shortcomings, the OTV system is easily understood by the seller and the buyer and is used widely in the high forest zone of Nigeria. For instance, in 1987, 66 percent of the total revenue accruing to government from the forestry sector was from OTV sales (Adeyoju and Enabor, 1988). In 1990, the percentage dropped to 60 percent, because of the identification of other sources of revenue and a reduction in the area of forest reserves being exploited. Also, since areas exploited under the OTV system are usually partially opened, it often results in minimal damage to the forest habitat for wildlife. In addition, the trees left over from an OTV sale, particularly the secondary or lesser-known species, help to control erosion and protect catchment areas in swamps and other areas with difficult terrain.

Trends in OTV charges. In the past, particularly between 1960 and 1979, there was only a gradual increase in the tariff rates for timber in the South West, with revisions in: 1969; 1974; 1979; and 1988. In recent times however, there has been a more pronounced increase in OTV fees. These increases might have been caused by the ban on the export of unprocessed logs and high domestic demand for wood for construction. Table 7 and Table 8 show that, while there has been a general increase in OTV charges in local currency (Nairas), these charges have declined in US$ terms. This suggests that these charges should be increased to reflect more accurately the value of the wood in dollar terms.

Among the various species, OTV charges also depend on the grade of wood (see Table 7 and Table 8). The first class woods, such as Afzelia spp, Teak (Tectona grandis) and Cordia, attract high charges, while Triplochiton, Gmelina and Diospyros are sold for lower prices in all states. There are also variations in charges from state to state for a given species. For example, the charge for Teak is as high as N 70 per cubic foot in Ekiti and Taraba states and as low as N 1.50 per cubic foot in Kogi State. The charge for Triplochiton is as high as N 56 per cubic foot in Taraba State and as low as N 3.50 per cubic foot in Kogi State. Even within any particular state, charges vary from one species to another with, for example, Ondo State levying a different charge for each of the main species groups, from N 19 per cubic foot for Diospyros to N 68 per cubic foot for teak (see Table 9 and Table 10).

Sources: data from (FORMECU, 1993) and from the field survey.