Tasmanian native forests and forestry

The management of Tasmanian native forests for paper pulp and conversion to plantations (or pseudo-plantations) gives the impression of being a particularly unsustainable industry, probably Tasmania's greatest value-detracting industry.

The main problems are heavy subsidisation, inadequate reserves for commercial forest types and poor forest practices. The primary source of these problems is allowing next to nothing for any forest values other than timber, resulting in severe under charging for wood taken from government forests and over-logging where logging would not have occurred if full-cost pricing were applied.

Poor forest practices are at least in part due to the underpricing of timber, better practices would result in losses of financial rather than natural capital (for which little accounting is required). The RFA has demonstrated once again that despite all the evidence of how environmentally malign this industry has become, little is done to improve forest practices, and reserves of the best forests remain inadequate. While Australia and Tasmania have made commitments to improve forest practices, to become more sustainable, until there is political will to enforce these commitments, improvement will be very slow and Australia will join the rest of the 'developed' world with minimal primary 'forest' remaining ¹ - Europe has less than 0.8% semi-natural forest and the USA only 1-2% - with the resulting loss of all sorts of environmental and economic values.

---

Subsidies

Dr Dragun's 1995 paper on Victoria's forest industries calculated an effective subsidy (primarily financial + conservation and water filtration losses) of around $300 million for the 1993-94 year (for revenue of $41 million). The NSW Public Accounts committee listed some 20 factors that tended to result in subsidisation of public native forest logging compared to that of private plantations. The 1998 Dept of Environment report on forest values 'makes clear that there is indeed evidence of serious weaknesses in the determination of the financial values of native forest timber. Our analysis indicates the very strong likelihood that native forest timber harvesting, as a commercial activity, is being subsidised . . . , is inefficient . . . and poorly managed.'²

Subsidising resource use is not just a local phenomenon: Norman Myers 1998 report 'Perverse Subsidies' noted that many countries subsidise their native forestry, the US Forest Service managed to show a US$1 billion profit over 1993-95 by the simple expedient of excluding the $2 billion+ logging road costs. Competing on price with other unsustainable industries is a recipe for significant and sustained economic and ecological loss.

Subsidies - Log trucks, like other heavy road transports in Australia are considered to be heavily subsidised. For example, a five or six axle log truck loaded to a maximum 39t (legal max for a standard 5 axle semitrailer in Aust), travelling 80000km a year with a fuel consumption of 2km a litre:
- in N.Z., charges based on cost recovery for road use are (for a maximimum allowable loaded weight of 39t) $NZ698.66 per 1000km or $NZ55893 per year (about $A46000). For lower axle numbers charges are much higher
- in Aust, charges are $4000 (5 axle) or $4300 (6 axle) per year + 18c a litre of diesel or $A11200-11500 per year, suggesting an effective subsidy of around $A34000 per truck year or 40c a km.

If the average trip per load is 100km (+ 100km empty) the subsidy amounts to $80 a load or for an average 30t load, $2.66 per tonne. This is broadly in line with the c1990 Very Fast Train study which calculated road damage at $40000 per heavy road transport per year, and ABARE report quoted in the Examiner early 1997 which calculated the road costs of replacing rail transport at (apparently) somewhat more than this. Note that this takes no account of any other road costs pollution, management and policing, accidents . . .

---

What is the Value of Forest?

A forest can have many different elements of value. Valuing the forest to be logged is an essential step towards determining the economics of the particular logging regime - different logging methods having different environmental impacts will also have differing impacts upon values. As an indication of the potential value of prime forest, government bought back some sections of partially degraded forest in the Daintree area of Queensland to add to the national park at $20000-$50000 per hectare, depending mainly on forest quality.

Initially, a preliminary valuation of the loss of ecosystem values from logging must be performed. These of course can only be approximate, given the sparsity of knowledge (often alluded to in the Tasmanian RFA Ecologically Sustainable Forest Management Report - Report E). In 1995 the federal government produced the introductory guide 'Techniques to Value Environmental Resources'. This emphasises

"By giving a dollar value to the environment, we are forced into more rational decisions that will include a more complete consideration of gains and losses of different resource management options" (p11). Unfortunately this was not used in the Regional Forest Agreement process for analysing the economics of forests. Valuing the environmental aspects and "non-wood" values also seems essential to satisfy two of the Agenda 21 (Ch.8) requirements for 'states': - incorporating environmental costs in the decisions of producers and consumers, to reverse the tendency to treat the environment as a 'free good'; and
- to move more fully towards the integration of social and environmental costs into economic activities, so that prices will appropriately reflect the relative scarcity and total value of resources (quoted in Rubenstein, 1994) I suggest an absolute minimum stumpage rate of around A$30 a tonne. Obviously each proposed logging area must be assessed for value to calculate what return is acceptable - ie. assessing natural values as well as financial development costs. Considering that natural forests, particularly primary forests have many values significantly above those of timber farms (plantations), the timber returns should also be commensurately higher for a logging regime to proceed. This suggests that high quality forest should only be logged at times when returns are very high, especially as pulp prices for native forest pulp are usually around 10% less than for plantation pulp.

Elements of value

A forest ecosystem is a complex structure with many interactions with the world. This ecosystem can provide benefits (or value) to current and future populations in many and varied ways. This is a very rough summary of the more obvious ones.

• Elements of value: 1. Direct Use Values - consumptive or extractive use
  • Timber From RFA reports, eucalypt veneers have a market value of $2300 per tonne, it seems strange that the governments return (before costs) was a mere $53 a tonne.
  • Paper pulp - Value (as at May 2001) around $150 a tonne (dry weight to shipside) versus $10 a tonne stumpage rates.
  • Energy?

• Elements of value: 2. Indirect Use Values - nonconsumptive use.
  • Ecosystem services
    Costanza, et al,³ estimated the value of ecosystem services from the world's forests at US$4.7 trillion or around $US1300 per ha per year.
    
    • Water filtration - Forests clean and moderate water flows and reduce erosion impacts of rain. This factor alone accounted for a substantial part of Dragun's assessment of Victoria's forest industry being subsidised to the tune of $300 million a year.
    • Carbon cycling and sequestration - Soil gradually forms under forest. Nakane modelled an increase of around 0.8t of Carbon per hectare under broadleaf forest. Clearfelling, burning and soil erosion are likely to release a large proportion of the soil carbon as well as all the above soil organic matter. Multiple cycles of logging appear (from several studies) to decrease the net carbon store over time.
    • Biodiversity - Habitat - Habitat retention is the most important factor in preserving biodiversity. Disturbing forest also allows weed spread (probably the second greatest impact on biodiversity). Biodiversity loss is a slow process, extinctions may occur upto 100s of years after the initial clearing. The potential spread of Phytopthera cinamomii (perhaps our most dangerous 'weed') is greatly enhanced with new roads.
    • Climate moderation - The transpiration of forests tends to create more stable micro-climates than surrounding areas.
    • Air filtration
    • Pollination

  • Tourism and Recreation - Natural forests represent some of the most accessible awe inspiring natural experiences in Australia. Considering the lack and continuing reduction of old forests remaining and the steady increase in eco-related tourism, their value will continue to increase.
  • Bioprospecting?

  Elements of value: 3. Option Values - Current logging, particularly clearfelling, closes off many possible alternative uses and substantially degrades others. If left unlogged now, there is still the potential for logging in future as well as other uses that (eg bioprospecting) that are currently little considered.

  Elements of value: 4. Existence Values The knowledge that natural forests or exist is valued by many people.

  Elements of value: 5. Bequest Values - is the value derived from the desire to pass on values to future generations.

Reserves

Although a relatively large proportion of Tasmania's 'forest' is reserved, it depends heavily on the definition of forest. The reserves are heavily weighted towards small non-commercial forest community types like E. nitida and short rain forest. One of the recommendations of the World Commission on Forests and Sustainable Development is 'halting further destruction or degradation of remaining primary forests, in order to secure their environmental services for all societies and species' [p7]

From 1995 Tasmanian pocket year book (ABS), high quality eucalypt forest in reserves amounted to 53 000 ha (11.5% of remaining, perhaps 3% of original) of a total of 474 000 ha. The 474 000ha, from the RFA estimates, appears likely to be about 25% of pre-1750 quantity. Using forest volumes for substantially mature forests as a proxy for 'old-growth' forest timber volumes, gives 41% of remaining in reserves. JANIS criteria requires minimum preservation of 15% of original of each forest type and 60% of extant old-growth of each forest type. See page on wet eucalpyt forests for more detail which shows more than 40% of a non-commercial species are reserved versus less than 8% of the main commercial species.

Sustainability

Forestry practices

Forestry Tasmania, the government body responsible for managing public forests, appears to suffer from 'industry capture' where it becomes an advocate of forest industry rather than of the public, the forest owners. Private profits result from public losses.

Some obvious forest practices that should exist to reduce the impacts of logging are protection of smaller semi-permanent streams, preservation unlogged in perpetuity of a proportion, say 20%, of every logging coupe, steep country logging limits and stricter conditions.

It is curious that even with a very weak forest practices code, there are many breaches of that code. After observing the poverty of progress on forest sustainability despite measures, reports, recommendations, sustainability indicators, one wonders if we have to wait for a generational change before subsidised devastation is no longer the norm? (unfortunately that would mean it is too late for most of Tasmania's 'commercial' forests).

Why is this so? Why can such an industry operate so badly?
To quote from Sutton, et al "We have all grown up in an unsustainable economy so it is very likely that some aspects of our mind sets will not fit that well with the reality of an ecologically sustainable economy."
Or Behan "professional forestry has not changed its fundamental perceptions in more than 200 years".
Or Geoff Carr 'In general, the activities of horticulturalists, agriculturalists and professional land managers are astonishingly compartmentalised and narrowly focussed, a situation which frequently permits short-term economic gains or "cost-effective" environmental management at the expense of irreversible biological devastation'.

2. Estimating Values for Australia's Native Forests, Dept of Environment, 1998

3. The value of the world's ecosystem services and natural capital, Robert Costanza, Ralph d'Arge, Rudolf de Groot, Stephen Farber, Monica Grasso, Bruce Hannon, Karin Limburg, Shahid Naeem, Robert V. O'Neill, Jose Paruelo, Robert G. Raskin, Paul Sutton & Marjan van den Belt , article in Nature

Summary Report World Commission on Forests and Sustainable Development Edited by Ajit Krishnaswamy and Arthur Hanson, World Commission on Forests and Sustainable Development (WCFSD) c/o International Institute for Sustainable Development (IISD) Winnipeg, Manitoba, Canada R3B 0Y4 http://iisd.ca/wcfsd

Behan, RW Multiresource forest management: A paradigmatic challenge to professional forestry in Journal of Forestry 88, p12-18, quoted in David Mercer 'A Question of Balance: Natural Resource Conflict Issues in Australia' (1st ed 1991, 2nd ed 1995, The Federation Press, Sydney)

GW Carr (1993) Exotic flora of Victoria and its impact on the indigenous biota. In Foreman, D.B., & Walsh, G.N. (eds) Flora of Victoria, Vol 1: Introductions. Inkata Press, Melbourne.

The World Bank Economic Analysis and Environmental Assessment, April 1998 Number 23

Tasmanian Public Land Use Commission, Tasmania-Commonwealth Regional Forest Agreement, 'Assessment of Ecologically Sustainable Forest Management Systems and Processes: Independent Expert Advisory Group - Preliminary Report (Background Report Part E)' (PLUC, Hobart, Nov 1996)

- 'Assessment of Ecologically Sustainable Forest Management Systems and Processes: Independent Expert Advisory Group - Final Report (Background Report Part G)' (PLUC, Hobart, Feb 1997)

- 'Options for the Tasmania-Commonwealth Regional Forest Agreement: a strategic approach (Background Report I)' (PLUC, Hobart, Apr 1997)

-------

www.vision.net.au/~rmartin/env/forest.htm
Last updated 25 Sept 2001.