The Role of Plantations in World Forestry by Jacek P. Siry, Frederick W. Cubbage, and Robert C. Abt 1

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1 The Role of Plantations in World Forestry by Jacek P. Siry, Frederick W. Cubbage, and Robert C. Abt 1 Abstract As forest decline continues, more and more attention is devoted to plantation management, which has the potential to ensure continued wood supply and prevent deforestation. A number of forest statistics are examined to assess the current state of the world s forests and forest plantations in order to help assess present and future roles of plantation management in world forestry. Plantation coverage is estimated at 230 million ha out of the total 3.4 billion ha of the world s forests in They provide as much as 35% of global roundwood production. High growth rates achieved by forest plantations can reduce the area of natural forests that have to be harvested to provide the same amount of wood. The importance of plantations will grow as their area and growth rates are increasing. It is estimated that by 2020 plantation wood production will increase by 50%. In a longer term, the significance of plantations will depend on government policies, technological progress, market conditions, land availability, industry globalization, and environmental issues. Introduction Despite growing environmental awareness and conservation efforts, forest decline continues. It is estimated that between 1980 and 1996 about 200 million ha of forests were lost, which represents an area larger than Mexico or Indonesia (Abramovitz 1999). On average about 13 million ha of forests were lost annually. Forest decline has a broader meaning that goes beyond forestland loss and encompasses the degradation of existing forests, the extent of which is largely unknown. Major causes include growing populations and income resulting in ever increasing demand for wood and land for agriculture and for development. In 1998 global population was estimated at nearly 6 billion. It is predicted to grow to 8 billion in 2025 and 9.4 billion in 2050 (FAO 1999). These population trends indicate that human pressure placed on the world s forests will continue. A range of solutions has been proposed to prevent deforestation and ensure continued wood supply. Demand side responses include population policies, consumer awareness campaigns, and certification programs. Supply side solutions include increased recycling, better wood residue utilization, improved harvesting and processing technologies, and intensified forest management with its prime example--forest plantations. This paper attempts to assess the role of forest plantations in world forestry and examines trends regarding plantation coverage, growth, production, and trade and their consequences for forest sustainability. World Forests Data on the extent of forests in the world differ considerably. Estimates depend on how one defines forests, the year data were collected, the source of the data, and the organization compiling the information. In this paper we use forestland area estimates drawn from FAO (1998, 1999) and other sources described subsequently. Table 1 summarizes the findings including world land, forest, and population statistics. Each of these relatively simple statistics is only moderately accurate and reliable, but they are the best available data. The FAO (1999) estimates that there are 3.4 billion ha of forests as of South America and the Russian Federation have the largest total forest cover in the world, at 871 million ha and 764 million ha, respectively. Africa (520 million ha), led by the Democratic Republic of Congo (109 million ha), follows next in total area covered by forests. Asia has 503 million ha, including Indonesia (133 million ha) and China (133 million ha). North America has 457 million ha of forestland, with 245 million ha in Canada and 212 million ha in the United States. About 3.2 billion ha of the forests were of natural origin. These areas comprised about 93% of all forests. Forest Plantation Coverage Data on world plantation coverage are sparse and incomplete. The FAO (1999) data enumerate total forest area and natural forest area. The difference between these data, when available, was computed to estimate the total plantation area reported in Table 1. However, the natural forest area figure was not reported for most major developed countries, including all of Europe, Canada, the United States, 1 Research Assistant Professor, Professor, and Associate Professor, respectively, Department of Forestry, North Carolina State University, Raleigh, NC

2 Japan, New Zealand, and Australia. Data for plantation area for these countries was thus taken from other sources, including Brooks (1993), Flynn (1996), Edwards (1996), Brown (1998), Cubbage et al. (1996), and our own current timber supply estimates. In total, we estimated that there are about 230 million ha of total plantations in the world, or about 6.7% of the total forest area. Europe has more than one-half of the total plantation area in the world, and Asia has almost one-third. North America has about 10%. The amount of industrial wood plantations also is difficult to quantify exactly, based on the general shortcoming on plantation data and the definition of industrial. Nevertheless, for this analysis we assumed that industrial plantations included all those grown on industrial or nonindustrial private or on some public forestlands that could be used to grow and harvest industrial roundwood for manufacture of forest products. We further added a subset of these to include fast-grown industrial wood plantations that were based on exotic or native species with growth rates of about 5 to 10 m 3 /ha/yr or more, and common rotation lengths of less than 30 years. Tables 1 and 2 summarize our different estimates of total forest area, natural forest area, and fast-grown industrial plantation area according to these criteria. Table 2 summarizes our estimates of forest area, industrial wood plantations, and exotic plantations for Europe separately, which includes a large share of the planted stands in the world, managed either extensively or intensively. In several countries in temperate and boreal regions, especially in Europe, it is difficult to distinguish between plantations composed of native species and natural forests. Historically, only areas planted with exotic and/or fast growing species are called plantations in Europe. There are about 5 million ha of this type plantations. However, most of European forests have been planted and then clearcut to provide wood for industrial purposes for decades, if not centuries. They cannot be considered natural forests and they mostly resemble a hybrid of plantations and natural forests. What distinguishes them from a pure plantation is a rather long rotation period. In order to assess the area of those forests, we assume that planting, clear cutting, and industrial wood production confer a plantation status on forests composed of native species. We approximated that area by calculating the number of hectares of exploitable coniferous forests. This is because most of coniferous stands are planted monocultures and produce industrial wood. While some of those stands may be naturally regenerated or have nonindustrial uses, they would be more than just offset by deciduous plantation forests. Regarding the former Soviet Union (including European and Asian parts), we were more conservative due to low planting survival rates and assume that only 15% of exploitable coniferous forests are plantations. This approach indicates that there are about 125 million ha of plantations in Europe, with 81 million ha in European countries excluding the former Soviet Union, which accounts for another 44 million ha. Flynn (1996) and Edwards (1996) provide relatively accurate estimates of industrial plantation areas for the southern hemisphere; Cubbage et al. (1996) do the same for North America. Brooks (1993) estimates broad classes of industrial plantation area for Japan, as does Yin (1998) for China, but probably only a fraction of this could be considered wholly for industrial production purposes. Most of the Japanese, Chinese, Indian, and African forest plantations probably cannot be considered industrial wood plantations because they were established for watershed protection, fuelwood, or desertification protection. In addition, the plantations often were not very successful; industrial timber harvests may be excluded by higher recreational or development uses; and the accuracy of the data is modest. For selected countries in Asia major and in Central America, we assumed that about half of the total reported forest plantation area would be devoted to fast-grown industrial wood production. Most planted stands in Europe, however, have such long rotations that we excluded them from the fast-grown category. In total, then, we estimate that there are about 230 million ha of forest plantations in the world. Europe contains the largest area of planted stands, with 125 million ha or about 55% of the world total, but only about 5 million ha are in fast-growing exotic species. The United States contains about only about 8% of the world s planted stands, but about 45% of the fastgrown industrial wood plantations. The U.S. South alone would contain about 33% of the fast-grown industrial wood plantations per our definitions, with 13.5 million ha. The Southern Hemisphere of the world contains the most fast-growing exotic plantations, with approximately 16.8 million ha. This comprises about 42% of all industrial plantations, but a greater and increasing share of industrial roundwood production. The industrial wood plantation area of about 40 million ha, or 1.2% of the world s forests, represent the minimum area that is actually subject to traditional or modern forest harvesting regulation

3 techniques. Probably much of the other planted stands in the world, many of which are in Europe, are also managed actively and subject to sustained yield timber regulation and management. The 230 million ha of planted stands (6.7%) are the most actively managed forests in the world. The remaining 93% of the world s forests are managed in natural stands, left to grow naturally, or are reserved from commodity production entirely. It is also of interest to compare our findings with other forest plantations studies. This paper identifies 230 million ha of forest plantations. Other studies generally are more conservative. Abramovitz (1999) estimate global plantation coverage at 180 million ha, Solberg (1996) 130 million ha, Brown (1998) 120 million ha, and Jaakko Poyry (1999) 111 million ha. These differences primarily arise from broader plantation definitions applied in this paper and the inclusion of European and Russian Federation forest plantations. Forest Plantation Growth, Production, and Outlook Data regarding plantation growth rates and production levels are even harder to obtain than their area information. Available sources indicate that tropical and sub-tropical plantations are primarily composed of eucalyptus and pines. The faster growth rates for these industrial plantations may average 30 to 40 m 3 /ha/year. Temperate and boreal plantations are primarily made of spruce, pine and fir, and average 10 to 15 m 3 /ha/year. These are average operational results for well managed industrial plantations. Growth rates on experimental plantations indicate that these rates can be exceeded using new technologies. Globally, 70% of plantations are made of softwood species and 30% of hardwood species. There are few estimates of annual forest plantations harvests. Brown (1998) estimated that plantations supply 25% of global industrial roundwood production, or 370 million m 3. Jaakko Poyry (1999) estimates are even higher and indicate that plantations supply nearly 35% of global roundwood production, or 624 million m 3. As far as product mix composition is concerned, data from New Zealand, Chile, South Africa and Europe indicate that plantations supply sawtimber and roundwood in equal proportions. Irrespective of disparate estimates of plantation coverage and production, the role of plantations in meeting future wood demand likely will grow. Plantation coverage is increasing and so are their growth rates. It is estimated that approximately 4 million ha of tropical and subtropical plantations are established annually (Brown 1998). Nearly 20 million ha of plantations are less 5 year old and 45 million ha less than 15 year old. These plantations will be coming into their production phase within the next two decades. Consequently, it is estimated that the current plantations industrial roundwood production will increase 50% by 2020 and double by 2040 at the latest. Since international trade data generally do not distinguish between wood coming from natural forests and plantations, it is quite difficult to determine how much of plantation wood is traded. This information, for example, would help to assess whether wood can be produced in areas characterized by favorable growing conditions and shipped to major demand centers experiencing wood deficits. Wood is a bulky commodity, and only 6% to 8% of world industrial roundwood production is traded. Global wood trade, however, has increased by about 30% in volume and 75% in value during the past 25 years and this trend is expected to continue. Trade data indicate that regions known for their effective plantation programs such as North America, South America, and Oceania lead industrial roundwood exports. This may indicate that plantation roundwood may increase its importance in global trade and help to mitigate wood shortages where wood deficits are common. While forest plantations represent an efficient approach to the production of wood fiber, they require modern management and advanced technologies that need to be applied for long periods before harvest can take place. This is expensive and raises questions regarding the profitability of forest plantations. Empirical evidence and recent studies (Siry et al. 1999, Yin et al. 1998) suggest that even very intensively managed plantations are profitable and generate competitive financial returns. While economic issues are important for making plantation investment decisions, the most heated debate surrounds environmental and social effects associated with forest plantations. Forest plantation advocates argue that plantations reduce pressure on the remaining natural forests. Environmental advocates on the other hand express their concerns that plantations replace natural forests. While this outcome cannot be entirely excluded, there is plentiful evidence that plantations primarily are established on degraded and agricultural lands (Sedjo 1995, Sedjo et al. 1997, Yin 1998). And

4 while compared to natural forests plantations are characterized by lower biodiversity, without a doubt they are far more biologically diverse and generate many more environmental benefits than agricultural or degraded lands. The role which fast grown plantations may play in carbon sequestration should also not be overlooked. Finally, it must be noted that in developing countries where large rural population livelihoods depend on forests, the impact of plantations on local populations is an important issue. While plantation investments may provide some employment and infrastructure that will benefit local people, they also may reduce access to forests. In a longer run, the future extent and role of plantations depend on a range of factors including government policies, technology advancements, new markets, industry globalization, land availability, and environmental issues. Plantation investments usually have a long time horizon and therefore closely depend on political stability and government subsidy and private investment policies. The profitability of plantation investment also depends on technological advancements in tree growing technologies that would allow growing trees faster and cheaper while minimizing negative environmental effects. Advancements in wood processing technologies can also help to develop new, better products with innovative applications. Reconstituted wood products, such as OSB and MDF, can serve as example of improved products that can be substituted for and effectively compete with steel, plastics, and concrete. Without a doubt, the extent of plantations will depend on the extent and access to natural forests and the availability of good quality land for planting. Environmental issues such as certification, sustainability, and carbon sequestration clearly will continue to play an important role in the future of forest plantations. The ability to strike a workable balance between productive and protective roles of forest plantations will determine investment returns as well as public acceptance. The future of plantations also will be affected by the globalization of wood processing industry, especially pulp and paper. It must be recognized that progressing globalization intensifies competition and induces increasingly efficient production, which hinges on an ample supply of homogenous, low cost fiber inputs. Producers strive to achieve the cost efficient scale of processing plants and try to minimize the cost of log transportation. This may lead to an accelerated plantation and processing capacity establishment in developing countries, where land and labor costs generally are lower. While economic, environmental, and social concerns are important factors in shaping the future role of plantations, it is apparent that well designed polices can reduce the negative impact of plantations while still capturing significant benefits. Conclusion World forests coverage is estimated at 3.4 billion ha as of Forest area is decreasing by an estimated 13 million ha annually. The continued decline of forest resources has renewed old concerns about wood shortages and negative environmental consequences. Forest plantations appear to effectively address many of these concerns. Forest plantation coverage is currently estimated at 230 million ha, or 6.7% of the world s forests. Only 40 million ha, or 1.2% of the world s forests constitute industrial fast growing wood plantations. It is estimated that all forest plantations produce as much as 35% of global roundwood supply. Plantations coverage and growth rates are increasing, indicating that their role in global forestry will grow as well in the future. Since plantation growth rates exceed those of natural forests, plantations allow for concentrated wood production on a smaller area and help reduce wood harvest pressures on remaining natural forests, providing better opportunities for their sustainable management. When established on degraded or agricultural lands, plantations generate substantial environmental benefits in addition to wood production. Fast grown plantations also play a positive role in carbon sequestration efforts. While environmental and social concerns surrounding plantations are important, well designed plantation programs can produce wood efficiently while also generating substantial positive environmental and social benefits. In a longer run, the role of plantations in global forestry will depend on government policies, technological progress, markets, land availability, industry globalization, and environmental issues. Today and even more likely in the future, forest plantations represent an efficient approach to land use and an effective response to wood supply and forest decline concerns.

5 Literature Cited Abramovitz, J.N Forest decline continues. In: Vital Signs, Linda Starke, Editor. New York, WorldWatch Institute. W.W. Norton & Co. p Brooks, D U.S. Forests in global context. General Technical Report RM-228. Fort Collins, CO: U.S.D.A. Forest Service, Rocky Mountain Range and Experiment Station. 24 p. Brown, C Global forest products study: thematic study on plantations. Consulting Report for: Food and Agriculture Organization of the United Nations. Rome. mimeo. Cubbage, F., W. Dvorak, R. Abt and G. Pacheco World timber supply and prospects: models, projections, plantations, and implications. Paper prepared for speech presented at: Central American and Mexican Coniferous Resource Cooperative Meeting. Bali, Indonesia. October 21-23, Edwards, M The South African forestry and forest products industry: a synopsis. In: Proceedings of the International Woodfiber Conference. Omni Hotel at CNN Center. Atlanta, GA. May 13-14, Published by the Pulp&Paper Report, Miller Freeman. looseleaf; 36 figures. Flynn, B Latin America: the future of fiber exports. In: Proceedings of the International Woodfiber Conference. Omni Hotel at CNN Center. Atlanta, GA. May 13-14, Published by the Pulp&Paper Report, Miller Freeman. looseleaf; 6 p., 10 figures. Food and Agriculture Organization (FAO) State of the world s forests, Obtained from World Wide Web site, July 1999: Rome, Food and Agriculture Organization of the United Nations. Food and Agriculture Organization (FAO) Forest products 1996, FAO Yearbook. Rome, Food and Agriculture Organization of the United Nations. p Jaakko Poyry Global outlook for plantations. Canberra, ABARE Research Report p. Kussela, K Forest resources in Europe. Cambridge University Press. Nilsson, S., O. Sallnas, M. Hugosson and A. Shvidenko The forest resources of the former European USSR. IIASA, Laxenburg, Austria. Sedjo, R The potential of high-yield plantation forestry for meeting timber needs: recent performance and future performance. Discussion Paper Washington, D.C., Resources for the Future. 30 p. Sedjo, R., and D. Botkin Using forest plantations to spare natural forests. Environment 39(10): Siry, J., A. Malmquist and F. Cubbage Potential impacts of increased management intensities on planted pine growth and yield and timber supply modeling in the South. In: Proceedings of the 1999 Southern Forest Economics Workshop, April 18-20, p Solberg, B Long term trends and prospects I world supply and demand for wood and implications for sustainable forest management. Research Report European Forest Institute. Yin, R Forestry and the environment in China: the current situation and strategic choices. World Development 26(12): Yin, R., L. Pienaar and M Aronow The productivity and profitability of fiber farming. Journal of Forestry 96(11):

6 Table 1. World Land, Forest, and Population Statistics by Region and Selected Country, circa 1995 Total Total Natural Total Fast-Grown Total Population Region/Country Land Forest Forest Plantation Industrial Population, Density, Area Area Area Area Plantation Area (people per (000 ha) (000 ha) (000 ha) (000 ha) (000 ha) (million) sq. km.) Africa 2,936, , ,455 4,782 2, Congo, Dem Republic 226, , , Ethiopia 100,000 13,579 13, Kenya 56,914 1,292 1, Nigeria 91,077 13,780 13, South Africa 122,104 8,499 7,204 1,295 1, Other Southern Africa 630 Sudan 237,600 41,613 41, Zimbabwe 38,685 8,710 8, Asia 3,073, , ,278 68,723 4,214 3, China 932, ,323 99,523 33,800 1, India 297,319 65,005 50,385 14, Indonesia 181, , ,666 6,125 3, Japan 37,652 25,146 14,946 10, Korea, Republic 9,873 7,626 6,226 1, Malaysia 32,855 15,471 15, Myanmar 65,755 27,151 26, Philippines 29,817 6,766 6, Thailand 51,089 11,630 11, Turkey 79,963 8, Viet Nam 32,549 9,117 7,647 1, Oceania 849,084 90,695 88,161 2,534 2, Australia 768,230 40,908 39,828 1,080 1, New Zealand 26,799 7,884 6,406 1,478 1, Papua N.G. 45,286 36,939 36, Europe 2,260, , , ,377 5, Northern 112,329 53,246 9,220 44,026 Finland 30,459 20,112 2,190 17, Norway 30,683 8,697 3,578 5, Sweden 41,162 24,437 3,452 20, Western 245,569 59,479 35,849 23,630 4,852 Austria 8,273 3,877 1,347 2, Belgium & Luxembourg 3, France 55,010 15,034 10,122 4,912 1, Germany 34,927 10,740 4,300 6, Italy 29,406 6,496 5,364 1, Spain 49,944 8,388 5,581 2,807 1, United Kingdom 24,160 2, , Eastern 1,902, , ,588 57,721 Belarus 20,748 7, Czech Republic 7,728 2, Poland 30,442 8,732 2,082 6, Russian Federation 1,688, , ,230 44, Slovakia 4,808 1, North America 1,838, , ,086 21,000 18, Canada 922, , ,571 3, United States 915, , ,515 18,000 18, C. America/Caribbean 264,774 79,443 78, Mexico 190,869 55,387 55, South America 1,751, , ,515 7,079 7, Argentina 273,699 33,942 33, Brazil 845, , ,239 4,900 4, Chile 74,880 7,892 6,877 1,015 1, Colombia 103,870 52,988 52, Ecuador 27,684 11,137 11, Paraguay 39,730 11,527 11, Peru 128,000 67,562 67, Uruguay 17, Venezuela 8,205 43,995 43, WORLD 13,048,410 3,442,369 3,212, ,996 40,164 5, Sources: Base data from Food and Agriculture Organization [FAO] (1999), Table 1 and 2; Europe data drawn from Brown (1998) and authors estimates in Table 2; Japan and Canada plantation data taken from Brooks (1993); Asia total plantation data mixture of FAO (1999) totals, plus Brooks for Japan; selected Asian and Central American fast-grown industrial plantation data: authors; U.S.A. plantation data estimated by authors based on USDA Forest Survey data; Latin America industrial wood plantation data from Flynn (1996); other southern hemisphere industrial wood plantation data from Edwards (1996); country plantation data reported for 1997 in FAO (1999); continental population data reported for 1998 in World Resources Institute (1998); empty cells indicate no reported data or that data were not available.

7 Table 2. Forest Area and Plantations in Europe, circa 1995 Region/Country Total Forest Total Exploitable Total Exploitable Estimated Total Exotic/ Fast Growing Forest Coniferous Forest Plantation Forest Species (000 ha) (000 ha) (000 ha) (000 ha) (000 ha) Northern Finland 20,112 19,511 17,922 17,922 Norway 8,697 6,638 5,119 5,119 Sweden 24,437 22,048 20,985 20, Subtotal 53,246 48,197 44,026 44, Western Austria 3,877 3,330 2,530 2,530 Belgium Denmark France 14,230 13,551 4,912 4,912 1,087 Germany 10,490 9,852 6,440 6,440 Greece 2,512 2, Ireland Italy 6,750 4,387 1,132 1, Luxemburg Netherlands Portugal 2,755 2,346 1,322 1, Spain 8,388 6,506 2,807 2,807 1,900 Switzerland 1,130 1, United Kingdom 2,207 2,207 1,587 1, Subtotal 54,240 47,454 23,630 23,630 4,852 Eastern Bulgaria 3,386 3,222 1,147 1,147 Hungary 1,675 1, Former USSR 754, , ,130 44,270 Former Yugoslavia 8,370 7, Former Czechoslovakia 4,491 4,491 2,869 2,869 Poland 8,672 8,460 6,650 6,650 Romania 6,190 5,413 1,549 1,549 Subtotal 787, , ,581 57,721 TOTAL 895, , , ,377 5,352 Note: Former USSR includes both European and Asian parts. Source: European Forest Institute Databank, Kussela (1992), Nilsson et al. (1992), UN/ECE Timber Committee.