You can’t eat trees
By Rodney LeLievre
Food producers will struggle to keep their farms unless the playing field against the forestry corporations is leveled. Forestry corporations are winning against food producers in the competition for soil, water and government support.
Across Australia, timber plantations are replacing food production as a result of the corporate capitalisation of Managed Investment Schemes (MIS).
In Tasmania, the plantation estate is already more than 650,000 hectares (6,500 sq kms) comprising more than 400,000 ha of private timber reserves and 250,000 ha of public and other plantations – totaling nearly ten per cent of Tasmania’s land mass.
Somehow plantation forestry has come to be classified as agriculture. Consequently, there are no restrictions to using our best soils for trees. Since trees grow much better on high quality land, plantation operators are very happy to buy up farms whenever possible.1
The Federal Government made a clear distinction that forestry is not an agricultural crop when it removed tax exemption status on agricultural MIS’s and not on forestry MIS’s. We should be demanding an explanation as to why the production of food does not rate as highly as plantation forestry for special tax treatment.
Food production for 2005 was reported by the Australian Bureau of Statistics (ABS) as about $800 million at the farm gate, with a further $1,600 million or so in downstream processing – a total of $2,400 million dollars from 86,000 ha of irrigated food-producing land, and supporting 3,877 businesses.
Mike Bolan, using ABS figures, estimates the average annual return per hectare from food production at $5,600. Running similar calculations for plantations, Bolan estimates that a plantation will yield 150
1. Bolan, M. (2007) You Can’t Eat Trees http://tasmaniantimes.com
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farms, mainly in higher rainfall areas, have been purchased by MIS corporations. Of approximately 4,552 farms in the state at that time, around a thousand are now owned and controlled by MIS plantation forestry corporations.
Private Forest Tasmania (PFT) figures state that in 2003, 1158 hectares of our farmland was turned into forestry plantations. In 2004 it was 3,563 hectares – an increase of 205%. In 2005 it was 6,266 hectare – further increase of 75.8%. In 2006 the amount of farmland lost to plantations increased by a huge 163.5% to 16,518 hectares.
Australia’s finite soil and water resources are up for grabs. Forest plantations are shaping up to use a lot more water than agriculture and demand is likely to exceed supply.
The problem, in a state like Tasmania for example, is that, in many areas, trees get the water first. In most of our river catchments the state forest has been converted to plantations.Vast areas of uniform young eucalypts suck the catchments dry. Consequently water becomes scarcer and more expensive for the farmer.
The distortions of the free market will overtake the nation’s food production capacities
The latest concern over water supply is that Hydro Tasmania in August confirmed a contract to sell the forestry monolith Gunns Ltd 26,000 megalitres a year – half of the total domestic water consumption of the whole of Northern Tasmania. For reference Launceston uses 29,000 magalitres.
“The proposed Gunns Ltd pulp mill’s huge thirst is the latest issue in a battle between farmers and forestry for water and soil resources.” (Tasmanian Country 10/8/07)
The threat to agriculture is that the distortions of the free market that occur with tax subsidised operations will overtake the nation’s food production capacities. A crop of trees takes ten to fifteen years to mature, while food production produces crops each year.
Furthermore most foods tend to produce a higher dollar return per hectare than trees, and generate more employment.
Shifting land use from food to tree production cuts overall revenues, reduces job opportunities and
tonnes green lumber per hectare, which will produce about forty tonnes of pulp at $600 per tonne. This earns $24,000 each fifteen years (the approximate lifecycle of a tree) or $1,600 per hectare per annum.
The 2020 Vision (plantation forestry) program places emphasis on the ‘investors’ in the plantations, but in fact most of the investment is made by taxpayers who are allowed 100% tax deduction for investing in trees.
The amounts paid to plantation operators for plantation development were also generous, given that the actual cost per hectare is around $3,500 while the deduction has been around $9,000.The difference of $5,500 has meant that plantation operators make enough to purchase more land after putting the money through their books.The result has been described by farmers as a tax-fuelled land grab.
This huge advantage provided to one industry by the tax subsidies is distorting the free market and exacting a growing penalty on rural Australia.2
When there is competition for scarce resources, as there is for Tasmania’s 107,000 ha of crop lands, then plantation operators can always dominate that competition thanks to the federal tax schemes. So there is a progressive shift in land use from food production to tree production, with serious consequences.
Since 1997, when the 2020 Vision was launched, about twenty per cent of Tasmania’s
2. Ibid
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cuts the cash flow to rural communities – all undesirable consequences of subsidising one industry in the competition for prime land.
Food production and its downstream processing activities are employment rich, contributing significantly to the nation’s economy – particularly as so much of the money passes through rural centres and stimulates local economies.
When tree plantations take over from food production, the process is largely irreversible, and therein lies the greatest threat of all.
It is the conversion of vibrant existing rural centres into socially depressed areas surrounded by trees, coupled with an increased failure to be able to feed ourselves from our own lands.We will lose control over the quality, variety and cost of foods available to Australians.
Tasmania is a particularly urgent case, being faced with the imminent approval of the giant Gunns Ltd pulp mill.
In Tasmania the battle for resources would be accelerated by the Gunns pulp mill, for which there has been no adequate risk assessment.Tasmania has more timber plantations per land area than other parts of Australia. More specifically Gunns, a major financial player in Tasmania, owns approximately 175,000 hectares of freehold land and manages in excess of 65,000 hectares of plantations (Tasmanian Government, 2006).
The Tasmanian government has married the state’s future with Gunns Ltd and its tree plantations, leaving the farmer, tourism, and everyone else well and truly out in the cold.
Originally from NSW, Rodney LeLievre is a horticulturalist living and working in rural Tasmania. A biodynamic farmer, he is the editor of The Journal of Biodynamics Tasmania and director of the Tasmanian Biodynamic Cooperative, a citizens action group concerned at the increasing corporate control of food production and distribution and the loss of our productive farmlands to forestry corporations.