• Forestry Home
• Illegal Logging
• Indigenous Forestry
• East Coast Forestry Project
• Crown Forestry
• Permanent Forest Sink Initiative
• International Forestry
• Publications
  • Forestry Production & Trade Statistics
  • National Exotic Forest Description (NEFD)
  • Wood Supply Forecasts
• Timber and Wood Products Procurement Policy
• Forestry Contacts

Plantation Forest Development Prior to 1870

Up to 1840 the New Zealand timber industry depended on the harvesting of Māori-owned indigenous forests. The provincial government in the Canterbury region of the central South Island provided the first encouragement for tree planting, passing the Planting of Trees Ordinance in 1858. This was mainly to encourage the development of on-farm wood resources on leased land in a region that had significant treeless areas. The ordinance permitted tenants to plant trees on their land and provided for reimbursement for the trees if the leases were terminated.

Summary Table

Year	Description	Purpose	Funding Source	Target Group	Cost	Impact on plantation development
1858	Reimbursement of costs if lease terminated	On-farm wood supply	Regional government	Landowners	Unknown	Low

Initial Recognition of Plantation Forestry and the Beginning of the Learning Curve (1870 to 1918)

By 1870 concern was developing over the rate at which the indigenous forests were being depleted. Some politicians recognised that the supply of industrial wood from the indigenous forests was not inexhaustible and future needs would have to come from imports or plantation forests.

Notwithstanding this growing realisation, the government’s primary objective of promoting European settlement and rapid economic development took precedence over any concerns about the rate of deforestation. Most of the land clearance by Europeans took place from 1870 to 1920.

Legislation

Two reports submitted to the government in 1870 did recommend incentives for the planting of trees and provided the initiative for the Forest Trees Planting Encouragement Act 1871. This was particularly targeted at the treeless Canterbury Plains and Central Otago in the South Island, where planting was needed to provide for building materials, railway sleepers, fuel and shelter for stock and crops. Under the provisions of the Act, farmers were entitled to a free grant of two acres⁵ of waste land for every acre of freehold land planted with suitable trees. The government also encouraged tree planting on state land by reducing the rents of lease tenants who planted trees on their leaseholds. The Act was never fully implemented, was not particularly popular with farmers, and by 1877 had resulted in only 622 acres being planted in Canterbury compared to 1300 acres that had been planted outside the Act on private land by 1871.

The first Forests Act in 1874 was an attempt to halt the indiscriminate destruction of indigenous forests and establish a forest department specifically focused on ensuring a long-term supply of (indigenous) timber. It provided for £10,000⁶ for 10 years to be spent on forest management, which included planting. However, the first conservator of forests, appointed in 1893, saw only a small role for the government in plantation forestry. Government forestry was also seen to be in conflict with settlement aspirations, and the legislation failed after three years.

Under the State Forests Act of 1885 the revenue from the harvesting of indigenous forests was placed in a dedicated "State Forests Account" from which the costs of plantation forestry could be drawn. The legislation also offered subsidies to local government for establishing plantations. Once again, however, the brief interest in forestry did not endure and the State Forest Department was disestablished in 1887.

Local Level Afforestation Assistance

From about 1871 large grants of government land were made to district councils for afforestation purposes. In return, the councils were expected to provide the seedlings and fund and undertake forest establishment, which were difficult to achieve. It was eventually agreed that planting should be gradual and that the areas where planting was deferred could be leased to provide revenue to defray some of the costs. Provincial governments also sought to increase private planting by the issue of a land order of ₤4 to anyone who successfully planted one acre with any type of tree. This scheme lasted for 20 years. It was particularly popular in Canterbury and Otago where the establishment of shelterbelts to provide protection from the prevailing northwest winds was valuable to farmers. Some of these plantations were up to two or three hundred acres of largely radiata pine or Cupressus macrocarpa. Continuous, small-scale planting, partly funded in this way, provided the foundation for the Canterbury Plantation Board to become New Zealand’s first plantation forest management agency.

Tree planting subsidy schemes had stopped in the early 1890s, but by this time the planting that had already been carried out had identified species with superior yield potential including several pine species, Douglas-fir, eucalypts, cypresses and, in particular, larch (Larix spp).

Trade initiatives

Despite the earlier legislative failures the government was still keen to assist the development of the industry as two examples in the early 1890s illustrate. In 1892 the Victorian government in Australia imposed a duty on imports of dressed timber but not on "baulk" lumber. The New Zealand government responded to industry pressure and countered this by introducing a counter-veiling duty on raw timber exports. The unintended side effect of this was to force those small operations involved in bulk timber export to have to sell domestically to the large companies. Then, in 1894, the government attempted to sponsor a timber trade with the United Kingdom, but this also failed.

Government Leadership and National Co-ordination

A turning point came in 1896 when the government convened a national timber conference, gathering together timber industry representatives, conservationists and farmers. This was significant for the conclusion reached that, because of the demand for timber, attempts to conserve indigenous forest would be futile without the establishment of plantations. Recommendations included:

• that it is desirable to at once commence the planting of lands unfit for agricultural or pastoral purposes;
• that experimental grounds be established….for the raising of various trees and the supply of trees at nominal cost to those willing to make plantations for timber purposes only;
• that advice and direction be afforded by government to assist private planting for forestry purposes.

These submissions were well received and adopted.

Government Afforestation

The Government responded in 1896 by establishing an afforestation branch within the Lands Department, and the first government organised afforestation commenced.

On the basis of the early trial results the government implemented an annual planting programme that focused on land in the central North Island volcanic plateau considered deficient for farming. The first tree nurseries were also established. Fifty-four acres were planted in 1898 and numerous trials were established to compare indigenous species with exotic species and determine the most suitable for plantations.

Nursery work and forest planting were labour intensive. Initially labour constraints hindered the expansion of plantation forestry, but tree-planting prisons were established and prison labour was used until 1920. By 1904 afforestation was up to about 1000 acres of new planting per year. Planting was focused on government land near railway lines where there was little existing adjacent forest.

By 1908 there were 9465 acres of plantations established. These plantings illustrated that exotic plantations were technically feasible, although the cost of establishment by the government was high. The average figure was ₤20 per acre (approximately $5,970 per hectare at December 2001).⁷

Government Supply and Demand Analysis

In the early 1900s it was reported to government that the quality and quantity of indigenous timber were diminishing rapidly and it was estimated that the supply was likely to be exhausted in less than 70 years (Kensington, 1907). Demand for wood was also growing rapidly. Between the turn of the century and 1908 imports had increased five-fold despite indigenous timber production doubling over the previous ten years.

A Royal Commission on Forestry set up in 1913 recognised the limitations of the indigenous forest for future timber supply, the unsatisfactory fragmentation of forestry administration, and a lack of interest in afforestation by the administrators. The Commission suggested that indigenous species, and even the most commonly planted exotic at that time – larch, were unsuitable for plantation purposes, but did note that Pinus radiata was being raised in quite insufficient numbers. The strong performance of pine species in New Zealand was becoming evident. Its roles in controlling erosion and stabilising sand dunes were also recognised.

Government Subsidies

In 1908 the government responded to industry lobbying by introducing reduced rail freight rates for timber, which had first been called for at the 1896 Timber Conference. The estimated cost of this to the government was between ₤25,000 and ₤35,000 (approximately $3.0 to $4.2 million at December 2001). Forestry was given a considerable stimulus when the government began supplying seedlings to settlers at cost price for farm planting as early as 1916, and assisted further through the provision of extension officers to give advice on planting.

The repatriation of First World War soldiers, an increase in the marriage rate, higher wage rates and a general feeling of prosperity, all led to high demand for wood for housing. This situation was fuelled by substantial government subsidisation of housing for returned soldiers. During, and for some years after the war, discharged soldiers were also eligible for grants of forest trees for farm purposes.

Indigenous Timber Controls

The growing awareness that New Zealand’s forests were being depleted resulted in the government introducing wide-ranging regulations in 1918 to control timber milling and exports. The Minister of Forestry was empowered to fix the maximum sawn timber production at each mill, to require millers to report on their activities, and to impose a system of export and domestic price control. Later, export quotas were introduced and permits were required for timber exports. The intention was to control domestic prices with the aim of "conserving New Zealand timbers for New Zealand use".

Period Summary and Conclusions

The period was notable for the gradual change from viewing the indigenous timber supply as inexhaustible to a realisation that without action to conserve indigenous forests and establish plantations, timber supplies would be inadequate to meet the country’s future needs. Accordingly, increasing government involvement in the forest industry took place.

Development and implementation of forest policy and legislation were severely hindered by the European pioneering attitude that saw forests as obstacles to settlement and the development of agriculture. While land settlement reached its peak around the turn of the century, forestry continued to be seen as appropriate only where settlement (agriculture) was uneconomic.

The government made several attempts to address these issues, but overall political support was weak until the end of the period. The principal direct means of encouragement of plantation forestry was grants of public land. Initial steps by the government to develop a viable industry and knowledge on afforestation, and the gradual refinement of cost-effective planting techniques, provided some indirect incentives. It can be argued that there was considerable subsidisation involved in developing the publicly owned state forests given the economics involved at the pioneering stage. By 1918 a toehold of some 13 000 hectares of plantations had been established, most of it government encouraged, but not government owned.

Government also impacted on the timber industry through duties and tariffs, adjusting rail freight rates, and establishing new wage bargaining procedures. These were generally ad-hoc responses to either crises in the timber industry, the increasing cost of production, or the increasing competition from imported timbers. The First World War resulted in the introduction of export price controls and quotas in an attempt to provide cheap raw materials for post war construction. Whilst this policy achieved its objectives it also meant that even greater incentives were required to attract private individuals into establishing new plantations.

The conclusions from this period regarding incentives for plantation forestry development are:

• a fundamental and long-term need by the country for wood was accepted;
• plantations could readily substitute for natural forests to satisfy nearly all this need;
• to avoid exhausting the natural timber resources when demand exceeds supply the early implementation of plantation strategies and incentives, if appropriate, are required because of the time lag between establishment and maturity;
• in a pioneering environment dominated by short-term objectives the New Zealand government had an important role in demonstrating and developing the management for a new land use, plantation forestry (based on exotic species), with a long pay back period;
• incentives will not succeed where they are at odds with the prevailing attitudes, and their success will be significantly impeded if other policies are not consistent with the objectives of the incentives;
• the reasons and objectives that led to the introduction of incentives must be clearly understood by all parties (governments, landowners, businesses and the population at large) for the incentives to be successful and to ensure an enduring commitment by all parties;
• fragmentation in government administration hinders the development and implementation of effective policy for a land use and industry that comprise a number of interrelated components.

Summary Table

Year	Description	Purpose	Funding Source	Target Group	Cost	Impact on plantation development
	Incentives
1871	Grants of land, reduced rentals, or land orders	Local timber supply and shelter	Central and regional government	Landowners	Unknown	Low
1870s	Grants of government land	Regional timber supply	Central government	District government	Unknown	Medium
1896	Establishment of afforestation branch of Lands Department	Conservation of indigenous forests via plantations	Central government	Central government	Unknown	Low
1986	National conference	Develop strategy	Central government	All stakeholders	Low	Medium
1915	Seedlings provided at cost price	Promote afforestation	Central government	Landowners	Unknown	Medium
1918	Indigenous timber controls	Limit depletion of native forest	Central Government	Indigenous industry	Zero	Low
	Disincentives
1874	Focus on indigenous forest management with some afforestation	National timber supply	Central government	Lands Department	£10,000 for 10 years	Low
1870 - early 1900s	Lack of political commitment to forestry					Medium

---

5 One acre is equal to approximately 0.4 of a hectare.
6 The New Zealand currency was pounds, shillings and pence until 1967 when dollars and cents were introduced at the rate of ₤1 to $2.
7 All inflation adjusted figures in this paper are based upon a Consumer Price Index (All Groups) regular survey that commenced on 1914. Where the original figure pre-dates 1914 the inflation adjustment for the intervening period is based upon an estimate of CPI trends from a 1912 Royal Commission report that detailed food and rent prices in New Zealand's four main centres from 1891.

 

Contact for Enquiries

Policy Analyst - Forestry
Innovation and Research
MAF Policy
Ministry of Agriculture and Forestry
PO Box 2526
Wellington
NEW ZEALAND

Tel: +64 4 894 0100
Fax: +64 4 894 0741
Contact this person