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I. Introduction

Within Species Variance

An observation that needs no elaboration is that trees of different species produce wood with different properties. Over time, this has led to consumer expectations based on common or trade names; and certain key species have attained high market value. Teak (Tectona grandis), rosewood (Dalbergia spp.), mahogany (Swietenia and Khaya species), walnut (Juglans spp.), black cherry (Prunus serotina) and redwood (Sequoia sempervirens) are examples of woods that, because of well-known intrinsic properties, command high market prices. In fact, the reputation of these woods is so widespread that other species, often with inferior properties, have been tagged with the same names – for example African teak (Chlorophora excelsa) and Philippine mahogany (various species in the genera Shorea, Parashorea and Pentacme). For this reason, throughout this document all common names are linked with standard botanical nomenclature, or in some cases we simply use the botanical nomenclature alone.

Prior to the last century most wood was harvested from indigenous forests growing from natural regeneration. As a consequence, soil type, moisture regime, climate, forest complexity and tree spacing were little changed over time. It was during this earlier time that commercial woods gained their particular quality reputations. But it should be noted that, even at this earlier period, some variation in wood quality was recognized based on origin of the timber.

In Europe, spruce (Picea abies) from high altitudes was valued differently from that growing at lower elevations. German oak (Quercus petraea and Quercus robur) was highly prized for veneer production because of grain pattern and ease of slicing; while English oak was valued for its greater strength, which lent it great value for shipbuilding - an enterprise that gave the British dominance of the seas for many decades. British colonists found that the pristine forest oaks of North America (Quercus rubra, and others) lacked the strength of British oaks and more closely resembled the weaker oaks of Germany. At the time these differences were ascribed to geographical or species variances, but we now know that the primary factor controlling strength in oaks is the rate at which they grow in diameter. Wider growth rings produce stronger wood in oak and similar woods (Panshin and deZeeuw, 1980; Summitt and Sliker, 1980). In the closed forests of Germany and pre-settlement New England oaks grew slowly, while the mostly hedgerow oaks defining agricultural lands in Great Britain received maximum light for rapid growth. Not incidentally these open-grown oaks also produced large branches that provided the compass timbers needed in shipbuilding.

As we move forward into an era where increasingly our wood supply will be coming from planted forests, the quality of the wood produced may be different from what consumers have come to expect for a particular species (Pandey and Brown, 2000). If this change is too great, market value will fall and market share will shift to other wood or non-wood substitutes. That this is not just a possible scenario for the future is revealed by examining the US construction lumber market during the past two decades. Rapid growth Southern pine (Pinus spp.) and Douglas-fir (Pseudotsuga menziesii) in planted forests are yielding wood that has quite different properties from that previously produced in natural forests (McAlister et al., 2000; Megraw et al., 1998). In this case – unlike the oaks previously cited – the wood produced is weaker and has quite different dimensional stability properties. As a consequence, framing lumber is weaker and studs and rafters twist and warp, leading to popped nails and distorted walls, and in the worst cases wall and ceiling separation. As this situation progressed, galvanized steel studs began to gain greater market share - despite the fact that carpenters needed to learn new methods and buy new tools (Zhang and Gingras, 1998). In recent years the wood industry has regained much of the lost market by producing engineered wood web-beams and studs – but this has been achieved at higher costs to the consumer. Wood technological fixes, as in this case, can solve some planted forest problems, but they are generally not a solution where solid wood product is needed, or demanded for aesthetic reasons.

An examination of recent trends in global forest product export prices from 1990 to 2002 reveals that, since the mid-1990s, wood and paper products have declined in value (FAO, 2005a). During this time the one exception was sawn-wood, which remained high until 2000. Since then, however, sawn-wood has joined the downward trend. It would be premature to attribute a cause for this recent sawn-wood decline, but it coincides with a rapid increase in timber output from planted forests, and it mirrors an earlier more localized trend in Washington State (USA) where declining wood quality reduced sawlog demand (Mittelhammer et al., 2005).

Consumer demand for wood products can often be linked to fickle societal taste changes. For example demand for wood as a flooring material in the US receded after World War-II, as cheaper, more ‘modern’ floor covering materials such as wall-to-wall synthetic carpeting or vinyl or other plastic tiles or sheet-goods came on the market. As those new markets matured, consumers began to see some of the faults of those materials and also yearned for the natural beauty of wood flooring. As a consequence, wood is now the most sought after flooring material in the USA, even for heavy use areas such as kitchens. Natural wood floors in Europe are also on the rise, often, as in Italy, replacing more traditional materials such as stone or terrazzo. Sometimes a new consumer demand leads to expansion of international markets, as in the case during the 1960s and 1970s when the Japanese decided that bowling was a cool new sport and New England suddenly found that it could barely keep up with Japanese demand for sugar maple (Acer saccharum) for bowling alleys, with prices inflated accordingly. For many applications natural solid wood or wood veneer has, and likely will continue to have, very strong appeal, even when other materials could be substituted.

Another factor weighing in favour of wood in the coming decades will be the increasing cost and potential scarcity of petroleum-based alternatives. Planted forests are renewable, capture carbon and help stabilize global climate and provide other environmental and recreational services. This bodes well for the future of wood as a raw material. Weighing against this optimistic view, however, will be loss of consumer confidence in wood, if important quality expectations are not met. Already, some market share has been lost to petrochemical substitutes, although promising compromises are seen in wood-plastic and wood-cement composites for building construction, decking and outdoor furniture (Anon, 2002). Not only are wood products competing with non-renewable products made from petro-chemicals, masonry or metals, but increasingly competition is coming from other renewable plant sources. Within the last few decades bamboo, wheat straw, rice hulls, sugar-cane bagasse, palm fiber and other plant materials have been tested (and in some cases profitably commercialized) as sources for board product that competes with wood (Durst et al., 2004). The challenge, then, is to devise planted forest strategies that actively strive for maintaining or improving intrinsic wood properties, and matching wood quality to anticipated future market demands.

The Global Situation for Planted Forests1

Based on FAO classification, planted forests consist of productive and protective plantations and planted components of semi-natural forests (Del Lungo and Carle, 2005). Between 1990 and 2002, timber plantation area increased an average of 14 million hectares per year, leading to a total of 187 million hectares (Gadow, 2005). According to one source (Leslie, 2003) planted forests will become the primary global source of wood products in the next 20-30 years. Yet preliminary FAO data suggests that this may have happened already. An estimated 7% of forest cover is in planted forests, 4% of which is in forest plantations, and these account for about 35% of global industrial roundwood harvest. When the other 3% of planted forests is added, the total area may approach 300 million hectares and account for about 50% of industrial roundwood supply - and this is projected to increase substantially in the future (FAO, 2005b).

The case for planted forests is controversial. Advocates assert that these reduce logging pressure on natural forests (Barber, 2004); but some case studies do not bear this out (Clapp, 2001). Regardless, the area of planted forests will continue to expand to meet world wood demand as more natural forests are excluded from logging activity - and under ideal conditions intensively managed planted forests can produce between 2 and 25 times more wood biomass per hectare than natural forests. For example, natural forests produce somewhere between 0.1 and 10.0 cubic meters of wood per hectare per year, depending on climate and soil conditions - an average is about 2-3 m3/ha/yr. Carribean pine (Pinus caribaea) plantations in parts of Venezuela are producing 5-20 m3/ha/yr. Some Eucalypt tree species are growing at a rate of 30 m3/ha/yr, and Paulownia (Paulownia tomentosa) - a tree native to China - that can produce 60 m3/ha/yr in Brazil, while Eucalyptus grandis, a native of Australia can produce up to 90 m³/ha/yr in Brazil. These growth rates are being eclipsed annually as new planted forests with improved provenances are established in new areas.

What we do not know is how sustainable these very high yields will be, or what kind of environmental impact they may have (Tiarks et al., 1998). Maintaining wood quality can be a major impediment in plantations with very rapid growth rates or where exotic species are used, but can also be a limiting factor in the success of planted forests with more modest growth rates where small differences in wood properties can spell the difference between success and failure in high-value niche markets.

Because the trend in market prices for wood products has been a declining one since the mid-1990s (FAO, 2005), finding higher-value small-market niches may be a useful solution for matching the quantity output of small-holder planted forests with the size of specialty markets. Examples of such markets include musical instrument companies, boatbuilding cooperatives, furniture designers and builders. These and other similar markets have small annual demand, but may require wood with particular properties and processed to specific requirements. If these requirements are met, market prices can be quite high. Furthermore, many of these specialty wood users in Europe and the USA have strong social and environmental ethics, both for themselves and their clients, and are, therefore, drawn to sustainably-managed wood sources, especially if they are certified. The area of certified forests in the world has increased from zero in the early 1990s to currently more than 176 million hectares; but 90% of these forests are in the temperate zone (FAO, 2005). In the past few years the Forest Stewardship Council (FSC) have modified their standards to include certification of plantations, but despite great potential the number certified in the tropics is very small. The cost of certifying small landholdings can be a significant hurdle, although non-governmental organizations (NGOs) and other sources of support are helping. Exporting indigenous species from planted forests, especially if lacking a certification stamp, can be difficult in some countries that impose export bans on logs harvested from natural forests. Furthermore, as countries, inevitably, strengthen enforcement against illegal logging certification will become an even more valuable asset.

Interim Cost Recovery Strategies

Due to the large initial costs for establishing a planted forest and the annual costs of management for best wood quality, strategies need to be established to offset some or all of these expenses prior to final harvest. Traditionally, early thinnings for lower-value markets, such as firewood, have provided some interim income. But other opportunities also exist. Capturing carbon credits is one possible revenue source. The environmental benefits are particularly strong for short rotation (6-8 years) plantations that produce chips for board products that will be incorporated into houses or other structures. The carbon capture phase is rapid and very high, and the storage phase is quite long. Agroforestry is another option, particularly for growing high value, long-rotation hardwoods. Tea and coffee plantations established with valuable overstory trees can provide annual income as well as longer-term remuneration when the high value trees reach maturity (or provide too much shade). Ecotourism and recreation are other possible sources of revenue. Recent surveys in industrialized countries suggest that the production of wood or other forest products is not the ‘major global value’ that the general public attaches to forests, but rather, they view forested areas primarily as sources of environmental services (Leslie, 2003). Another option is the growing of trees with a “dual” purpose, e.g. wood and latex, as lately with Hevea brasiliensis in South East Asia.

Until recently ecotourism has been focused on natural, often protected, forests, particularly those with high biodiversity. However, more recently, perceptive tourists seeking a different experience are being drawn to other kinds of venues, even those that dramatically reveal environmental damage (for example, coal strip mines in Appalachia, USA). Well-managed community forests could become recreation and ecotourism destinations, especially if local culture and crafted wood and other forest products were part of the package. Sale of local products and guide fees could be a continuing supplementary source of revenue.

1 Forests in which trees have been established through planting or seeding. Includes all stands established through planting or seeding, both of native and introduced species.

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