Over-Regulated and Under-Marketed: Smallholders and the Wood Economy in Isabela, The Philippines - Smallholder Tree Growing for Rural Development and Environmental Services - page 155

innovations require years before they are translated in smallholder's profits, but the
effects of policy interventions can be felt quickly in terms of prices and markets at
the forest or the farm-gate (Tomich 1996). In the process, trade restrictions that lead
to collapse of farm-gate prices can destroy incentives necessary for domestication
and commercialization of both timber and non-timber forest products in agrofor-
estry systems. Worse still, well-intended policy measures aimed at the protection of
natural forests may also be applied to agroforestry systems that are managed sus-
tainably by small-scale farmers (ASB 2001). The unintended result of treating all
timber alike regardless of its origin in forests or farms may be that smallholders
who plant and manage the trees are burdened by unnecessary regulations that
weaken their motivations to further invest in trees.
The design of institutional structures that address these problems - in other
words, institutional structures that stimulate smallholder timber production or at
least do not interfere with it - requires knowledge on how smallholders are con-
nected to the wood markets and how this relationship is mediated by regulations.
However, very little is known about the decentralized markets for smallholder-pro-
duced forest products that operate in many rural areas in general (Veeman 2002),
and the Philippines is no exception. Against this background, the aim of the present
paper is to address this knowledge gap for the case of the Philippines, with a special
objective to elucidate how regulatory policies interface with the relationship
between smallholders and the wood market. We will focus on the two legal wood
trades that occur in the area, which concern gmelina timber and fuelwood/charcoal.
Fruit trees will be mentioned here and there for comparative purposes, given they
also represent a tree-based income source.
Due to our explorative and policy-oriented objective, we applied a relatively
informal research design that remains close to the life world of the tree growers. In
spatial terms, our focus is on an upland area relatively close to a natural forest zone,
because many tree growers in the Philippines live in that type of environment, and
because we expect that the possible interference of tree growing and forest protec-
tion policies may be most likely felt there.

7.2 Description of Study Area

The Sierra Madre mountain range in northern Philippines is an area of many possi-
bilities in tree production and products trade. The forests are counted among the last
strongholds of the Philippine forests and recognized as one of the most biodiversity
rich ecosystems in Southeast Asia. A big portion of this mountain range stretches
in the province of Isabela where a large-scale corporate logging industry used to be
a top earner until the imposition of a logging moratorium in 1992, that was intended
to keep at least part of the forest for nature and future generations. Nevertheless, the
furniture industry continues using narra ( Pterocarpus indicus ) and other hardwood
species illegally cut in the forest. This well-organized illegal timber flow runs parallel
to that of plantation-sourced wood, notably gmelina, grown largely by smallholders