Maximise forest income

FORESTRY is a very valuable alternative source of income for landowners. Presently farmers and non farmers can avail of tax free grants and premia. Commercial forests are exempt from Capital Gains Tax on the growing timber. Income from the profits of timber sales is also exempt from Income Tax. In order to maximize profits there are a number of key phases which must be undertaken. Failure to carry out any of these will lead to a significant loss of income. ESTABLISHMENT PHASE: The site must be capable of producing a commercial crop of wood. Marginal heavy rush land is ideal. A very attractive tax free premia of circa €200 per acre is available and the owner can still receive the Single Farm Payment. There are no initial costs for the first four years as all afforestation costs are grant aided. Forest Service standards and all Environmental issues must be observed. God help you if you are in a Hen Harrier area as the restrictions make little common sense. Ground preparation normally consists of Mounding and Drainage. Fencing ie. Stock. Sheep, must be carried out to specification. My Company only plant Grade 1 Washington Sitka Spruce plants, which guarantee excellent growth rates and quality timber. MAINTENANCE PHASE: Extremely important. Vegetation control consisting of manual cleaning or chemical spraying must be carried out for the first year and as necessary after that. Any plant failures must be replaced. All fences and gates must be maintained to prevent trespass. Both establishment and maintenance phases are grant aided. 75% at establishment and 25% at year 4 when after Forest Service inspection the crop is regarded as free growing. HARVESTING PHASE: First thinning can take place between year 15 and 18. A grant aided road should be constructed prior to harvesting ( 20 metres per hectare at €40 per metre ).

A Felling Licence must also be obtained. Proper silvicultural thinning produces an interim revenue source, will improve the value of the final crop and shorten the rotation length.

The forest owner is the primary producer and should seek professional help in the sale of his/her crop. Do not be cent wise and euro foolish.

I have seen too many disasterous results whereby plantations have been ruined by poor thinning practices. Ensure that a proper sales agreement is drawn up stating price, payment schedule, timber removals etc. The real money is at the clearfell stage.

Proper implemation of the above will reduce the rotation length, ensure quality timber and maximum profit.