Dr. Greg Frey - Sustainably Utilizing Your Forest Resources

transcript

Sustainably utilizing your forest resources

Small Farm Family Conference November 1-2, 2011; Danville, VA

Greg Frey

Extension Specialist - Forestry Virginia Cooperative Extension

Virginia State University

Many landowners say:

I am continuously putting money into my forestland – taxes, planting, monitoring.

I want to be a good steward of the land.

Timber takes so long to grow.

How can I make money from my forests?

Statistics

• 79% of forestland in Virginia is owned by Non-Industrial Private Forest (NIPF) landowners.

• 89% have less than 50 acres.

• However, 67% of forestland is owned by 11% of the owners.

How can small farm/forest owners make money in this environment?

Source: Rose, A.K. 2009. Virginia’s Forests, 2007. USDA Forest Service.

Objectives

• Review some steps to get good information and make smart decisions.

• Give small farmers/landowners an overview of some options to make money from their woods, and discuss some advantages and disadvantages.

Step 1: Determine your objectives

• Stewardship

• Personal activities/recreation

• Total profits

• Annual income

• Low costs/investment

• Ease of management

• Ease of marketing

Photo Credit: Forest Landowner Education Program

Step 2: Consult a professional

• VA Department of Forestry County Foresters

• Consulting Forester

• VA Cooperative Extension

Photo Credit: Virginia Dept of Forestry

Step 3: Define your activities and/or products

• Timber

• Fuelwood

• Recreation

• Conservation

• Non-timber forest products

• Agroforestry

• Carbon

Photo Credits: Forest Landowner Education Program; http://shiitakemushroomlog.com/

Step 4: Plan and manage

• Would you start a garden without thinking about what you want to grow?

• Would start it without planting anything?

• Would you grow it without controlling weeds?

Step 4: Plan and manage

You can get support to help with the following:

• Land use plan

• Land Stewardship Plan

• American Tree Farm System

• CAP 106

For many activities, it is also beneficial to develop a business plan.

Step 5: Reduce your costs

• Land use tax rate, if available

• Tax credits and deductions

• USDA cost share programs (WHIP, EQIP, CRP, CSP, others)

• VA Best Management Practices loans and cost share

• VA woodlands improvement and health cost share

Step 6 & 7

• Keep records.

• Plan for your heirs.

Options for generating income with forest resources

Timber

What is it?

• Sawtimber

• Pulpwood

Timber

What are the advantages and disadvantages for small farms?

+ Timber can wait until you need it, or until prices are good.

+ Compatible with other products (e.g. recreation). + Low intensity management. - Long waiting time. - Competition with large landowners - There may be some unscrupulous loggers. - Markets for products like pulpwood are on the decline

in many areas.

Timber

What do I need to do?

• Contact a forester & create management plan

• Site prep, planting

• Competition control, release

• Thinning

• Work with a forester on timber sale

and cost-share programs

• Keep records

Photo Credit: Greg Frey

Fuelwood

What is it?

• Firewood

• Charcoal

• Biomass (chips/pellets)

Photo Credits: Forest Landowner Education Program; http://www.pine3.info/Charmake.htm

Fuelwood

+ Use material that would otherwise be wasted.

+ Very small to the medium or large scale.

- Prices are not high, but might be a source of side income.

Fuelwood

• Develop a management plan and a business plan.

Recreation

What is it?

• Hunting

• Fishing

• Hiking

• Camping

• Bird watching

• Other tourism activities

http://www.earlybirdies.net/ Photo Credit: Forest Landowner Education Program; http://www.earlybirdies.net/

Recreation

- For many leases, you need a relatively large area.

- Prices not high.

+ Management is not too hard, once you have the legal issues sorted out.

+ Annual income

Recreation

• Find an individual or group to lease your land, or seek bids.

• Work with a lawyer.

• Make sure you have the right insurance.

• Forest improvement for wildlife.

Conservation

What is it?

• Easement - Give away, or sell, your rights to develop a portion of your land, either permanently or for a set period of time.

• Undertake forest improvement practices.

• Claim numerous tax deductions or credits, or cost-share payments.

Conservation

- Terms can be flexible, but you forfeit some of your rights. Only do this if you absolutely do not want your land to be developed.

- Many conservation trusts don’t deal with small acreages.

+ Cost share and tax deductions from state and federal government.

Conservation

• Speak to a professional

• Appraisals will be done for the value of your land with and without easement

Non-Timber Forest Products

What is it? • Pine straw • Ginseng, Goldenseal, Cohosh • Ramps • Mushrooms • Honey • Crafts (Oak baskets, Holiday greenery) • Christmas trees • Many others

Photo Credit: Forest Landowner Education Program; N.C. Department of Agriculture and Consumer Services

+ Find a niche.

+ There are so many NTFPs, it is possible to find one to match your management objectives.

+ Can be “wild-cultivated” or managed.

- Marketing is time consuming.

- Requires willingness to experiment.

• Investigate NTFPs that would match your farm conditions and management objectives.

• Contact a professional or specialist.

• Develop a management plan and business plan.

Photo Credits: Forest Landowner Education Program; http://www.southernliving.com

Agroforestry

What is it?

• Forest farming

• Silvopasture

• Alley cropping

• Windbreaks and shelterbelts

• Riparian buffers

Photo Credits: Greg Frey; National Agroforestry Center

Agroforestry

What is it? Silvopasture example

http://www.youtube.com/watch?v=VJsKmBbtw7Q

0:00-5:18

Agroforestry

+ Diversification of income.

+ Annual income and long term “savings account”.

- Intensive management.

- Requires willingness to experiment.

Agroforestry

• Be willing to spend some time doing research and experimenting.

• Contact a professional or specialist.

• Investigate practices that would match your farm conditions and management objectives.

• Develop a management plan and business plan.

Carbon offsets

What is it?

• Trees capture carbon dioxide from the atmosphere.

• Some groups are willing to pay for this service, to offset their own carbon emissions.

• Driven by California’s climate program, the Climate Action Reserve (CAR)

Carbon offsets

- At present, the market in the US is virtually non-existent.

- For the foreseeable future, market will attract only large players, because of high cost of project design, and of monitoring and verifying emissions.

Carbon offsets

• Not much you can do since the US market is not very large, just wait, and do something else in the meantime.

Comparison Timber Fuelwood Recreation Conservation

Easy to market ++ + + +

Competition with large producers

-- + -- --

Annual income -- +/- ++ +/-

Management intensity

++ + ++ ++

Costs/Investment + ++ ++ ++

Profitability - - -- --

Comparison

Non-timber

Forest Products Agroforestry Carbon

Easy to market -- + --

Competition with large producers

++ +/- --

Annual income +/- ++ +/-

Management intensity - -- +/-

Costs/Investment - -- --

Profitability ++ ++ ?

Review

1. Determine your objectives

2. Contact a professional

3. Define your activities and products

4. Plan and manage

5. Reduce your costs

6. Keep records

7. Plan for your heirs

THANK YOU

Questions about this presentation:

Greg Frey – gfrey@vsu.edu; 804-524-6967

For more information about forest planning, and about cost share and other programs, visit your local County Forester (VA Dept of Forestry), Cooperative Extension office, or USDA Service Center