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The economic value of trees by John Baxill
We all know about the value of trees for such things as soil conservation, giving shade and providing windbreaks. What this article will try to show is that growing trees can be a business! You may be surprised to know that there are several individuals who make a living from selling poplar poles and firewood, especially in the mountains. For most of us though, growing trees can be a profitable sideline rather than a way of making a living. Planting some fruit trees is obviously a good way to make some money if the fruit can be sold close by. However, in this article we will look mainly at planting trees for fuelwood and poles. A good way of looking at trees in your ownership is to consider them as insurance for those times when you suddenly need cash such as funerals or when it is time to pay school fees. If you can manage to sell some trees at this time this can be a real help. And of course, unlike livestock, trees don't fall ill. How much are trees worth? This is a difficult question to answer as it often depends on many local factors such as how much wood is available in the area. We have found that the price the Forestry Division uses when it sells trees is well below the average price trees are sold at in the village. The official Forestry Division price for standing trees is M²2.50 per cubic metre and M²5 per cubic metre for felled trees. This is an official price, but M² is the village price. (M=1 Rand). So what about the economics? Let's do a simple calculation and see how much one can make from planting trees compared to putting the money in the bank. If I have R10 which I can spare to invest for the future, I can put it in the bank at say an interest rate of 15%. This means that after one year the R10 will become R11.50 and afler 7 years it will become R26.60. Not bad, the money has more than doubled! Now, if if I had bought 50 trees at 20c each with the R10 instead of putting it in the bank and planted them, how much would the trees be worth after 7 years? Let us assume 10 of the trees die for one reason or another. I will be worth 40 x 1.20 = R48. But more realistically they will he worth say R2 each. The trees are then worth 40 x 2 = R80. So with that same R10 I have made more than double the money by planting trees than I would have made by leaving the money in the bank. Of course, if you can raise your own tree seedlings from seed or plant poplar or willow cuttings in the winter then the cost is virtually nil and it becomes even more profitable. In the long term it will be better to use species which sprout from the stump (coppice) after cutting them,because then you do not need to spend money buying seedlings to replace the ones you have cut.
Firewood is a relatively low price product. If you can produce poles of decent quality people will pay a good price. If the. poles are treated with creosote they will last longer and will be worth more. The best prices are for large trees which can be sawn up into planks. Unfortunately at the moment there are no facilities for saw milling in Lesotho but the Forestry Division has proposed a project which would enable Lesotho - grown trees to be sawn into planks or made into furniture. In addition to these wood products some trees or shrubs can produce useful fodder for feeding to livestock, but space does not permit a full account of this. The Forestry Division is keen to involve local groups, VDCs etc. in the marketing of wood from woodlots. This would involve the group buying a block of trees at a slightly discounted official price and then taking responsibility for transporting and selling the wood at any price they see fit. They would be free to keep the profits. I hope this brief look at the economic value of trees has shown that even though they grow slowly, trees can be a useful store of capital for the farsighted. Surely it must make sense to plant some trees every time a child is born, then when it is time to pay school fees these can be sold and you will feel very clever. If you have any questions or would like more information please write to the: Ed note: This is an interesting argument but more detailed information about labour costs, risks, transport etc. is needed to help readers to make similar comparisons in other countries . [top] [end]Contents: Boiling Point 24: Solar Energy
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Page created:
31 July 2008; Last edited:
03 September 2008; Version: 0 | ||||||||||
Pagename: BP24:TheEconomicValueOfTrees @HEDON: GTMA | ||||||||||
