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, and at the same time receive their full Single Farm Payments. Commercial forests are exempt from Capital Gains Tax but the underlying land is not. At present my Company has a strong demand for semi-mature plantations and bare ground, and I am actively sourcing same with maximum prices guaranteed. Income from the profits of timber sales is exempt from Income Tax. Commercial woodlands are subject to Capital Acquisitions Tax on gifts to, or inheritance by individuals.

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. Select Forest Ltd. insure that all phases are carried out to best Forest Service silvicultural and environmental standards, in order to achieve maximum profits in the shortest possible time scale.

Establishment Phase:

The site must be capable of producing a commercial crop of wood. Marginal heavy rush land is ideal and produces quality timber on a short rotation. 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. Ground preparation normally consists of mounding and drainage is carried out where necessary. Plantations must be fully fenced from time of planting (Stock. Sheep,) and must be carried out to Forest Service specification. My Company only plant Grade 1 Improved Washington Sitka Spruce plants. Even though they are more expensive, they 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. There should be no further work required until year ten when inspection paths have to be cut in order to facilitate the assessment of the crop for the preparation of a Management Plan for the following ten years. It will assess stocking rates, crop volume, and stability leading to a decision on when to carry out a first thinning. It will assess the need for a harvesting road, and the application to the Forest Service for a general felling license.

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). 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. Presently timber prices are good and are on an upward curve. There is a very strong demand for Pallet and sawlog. I have seen too many disastrous results whereby plantations have been ruined by poor initial thinning practices. I own and manage my own plantations and would only recommend to my clients those sawmills with whom I deal with myself. I am certain of proper silvicultural thinning and prompt payment. It is absolutely imperative that a proper sales agreement is drawn up, stating price, payment schedule, timber removals, completion date etc. The real money is at the clearfell stage. Proper implementation of the above will reduce the rotation length, ensure quality timber and maximize profit. Select Forest Ltd. is committed to all phases on behalf of the land owner. There is no initial cost, the owner retains full ownership of land and crop, receives a tax free premium, retains single farm payments and is building a pension for oneself or a family member. Tel: 087-2221661 Email: selectforest @gmail.com