Can Smallholder Tree Farmers Help Revive the Timber Industry in Deforested Tropical Countries? A Case Study from Southern Philippines - Smallholder Tree Growing for Rural Development and Environmental Services - page 169

Unfortunately, tree farming has been promoted on the promise of huge economic
returns, 2 based on overoptimistic yields of fast-growing trees in favorable tropical
humid conditions and unrepresentatively high timber prices at specific times and
locations. 3 In the past few years, lower than expected returns from tree farming,
particularly with Gmelina arborea (hereafter referred to as gmelina) and
Paraserianthes falcataria (hereafter referred to as falcata), has caused disenchant-
ment among upland farmers (Caluza 2002). As planted trees reached harvestable
age, prices fell drastically due to market saturation. In 1997, the price of gmelina
on stumpage averaged PhP 4.0 per board foot (bd.ft.), (i.e., US$33 m −3 ), a 60 percent
decline with respect to prices in the early 1990s. Moreover in the smallholder
context, timber yields may be lower than predicted as a result of adverse soil condi-
tions and farmers' poor management practices (e.g., excessive pruning and lack of
thinning).
In spite of these setbacks, interest in tree farming is still high. A field survey
conducted in the upland municipality of Claveria, northern Mindanao, among 112
randomly selected farmers (sampling fraction ranging from 1.3 percent to 1.6 per-
cent), of which 75 percent had planted timber trees, revealed that 55 percent (62
farmers) intended to plant timber trees in the near future. Of these, 37 farmers were
non-planters and thus farm forestry is new to them, while the remaining 41 per-
cent (25 farmers) were already tree planters who wanted to expand their plantations
(Bertomeu 2004). In addition to the benefits provided to rural families, including
fuelwood, construction materials, protection against erosion, shade and shelter,
farm-grown trees are taking an increasing share of the timber industry and trade in
the Philippines. The existence in Region 10 of northern Mindanao of 135 small-
scale sawmills (SSS) exclusively supplied with farm-grown timber (DENR 1996b)
demonstrates the extent and importance of tree farming in the region and provides
evidence that growing timber trees on farms is still considered a viable livelihood
alternative and an activity with an importance to the wood industry sector.
In many countries and regions of South and South-east Asia trees planted on
farms are becoming the most important, if not the only, source of timber. In Punjab,
India, farm trees account for 86 percent of the province's growing stock. In Sri
Lanka, “trees outside the forest” represents over 70 percent of industrial wood, and
in Pakistan trees on farms account for 23 percent of all timber growing stock. Even
in Indonesia, a country that still has vast forest resources, some 20 percent of the
total wood consumed is derived from trees outside the forest (FAO 1998). In the
Philippines, increasingly larger volumes of timber consumed come from planted
trees as well. Most of these are grown on small farms in the sloping uplands. This
paper describes how the marketable surplus of timber produced by farmers is reach-
ing the market, the structure of this market and the end uses of farm-grown timber
2 The slogan “Kahoy karon, bulawan ugma” (Trees today, gold tomorrow) popular among
Philippinos in northern Mindanao exemplifies the expectations put on tree farming.
3 A local newspaper reported that 1 ha of Eucalyptus deglupta could yield “Ph P 14,000 per tree or
Ph P 10.5 million per hectare” (Fonollera 1996).