August 21, 2024 • 9 mins
We head to the coalface to talk to a Hawke's Bay sheep and beef farmer and farm forester who asks “Is production/carbon forestry the new diamond mining?”
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Episode Transcript
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Speaker 1 (00:00):
So you've heard from doctor Jenny Webster Brown, author of
the White Paper Y Pines. Let's talk to someone at
the coalface Central Hawks May sheep and beef farmer and
forester Mark Warren. You might remember his book Many Muddy Morning.
Speaker 2 (00:16):
Mark.
Speaker 1 (00:16):
You've come out with a presentation and it's titled is
Production Slash Carbon Forestry the New Diamond Mining? Are you
like Shane Jones who's already been on the show today,
do you want to plant the entire east coast of
the North Island and pine trees?
Speaker 2 (00:34):
Jamie, No, not at all. My mantra is always is
the right tree, right place. You've got a hardhill country place,
you know probably ten to fifteen possibly twenty five percent
is much more productive and profitable, and you know, good
production forestry and also stabilizing soil. So no, don't plant
(00:55):
the whole lot. That's an absolute crime against humanity. Okay.
Speaker 1 (00:58):
Now, I know you've done well and you've got into
farming in the tough years the eighties, and over that
time you've done well out of farm forestry. Of course,
now you've got two bites at the cherry. You've not
only got the production forestry, you've also got the carbon credits.
Is now a great time for farmers to plant some
of their farms and to pine trees.
Speaker 2 (01:19):
Well, it's a great way of generating a bit of cash.
But please don't say that I'm advocating for it, well
the whole eighty yes, because I don't necessarily believe it.
Don't shoot me. I'm only the messenger. But it's certainly
a great option to generate a bit more cash out
of the system. Just remember, the carbon credit systems a
little bit like rural bitcoin, and any industry created by
(01:42):
the stroke of the pen can disappear with a stroke
of pen. So yes, it's been great, but you know,
it's a little bit like a bureaucratic a big bag
of candy floss, really, and it all looks good until
you squeeze it right down and the bug all lesson.
Speaker 1 (01:54):
Well, Mark, I reckon. It's got a bit of a
whiff of the Emperor's new clothes about it.
Speaker 2 (02:00):
Yeah, it has a little bit. You know, it suddenly
jump ten percent this week up for sixty bucks. My
numbers were done on at about fifty four for that presentation.
They're all Rual Estate Institute. But yeah, look it's it's
hard to know if it's really viable long term. But
in our case it meant that we could balance the
(02:21):
books and not make a loss last year in sheep farming,
which apparently was quite hard to do. So it's got
some benefit. But it's followed little bureaucratic fash books. And
I've got to say that MPI have just grayed huge
amounts of confidence measuring it all. And what I'm saying
that if anyone else has noticed, their maps have had
just lines drawn across from on land that should be
(02:43):
included for forestry accessible for ets has been rejected in
an out case, They've each included land that never should
have been included. So you're dealing with some people there
that I won't see the name on radio, but it
defies logic.
Speaker 1 (02:57):
You talk about right tree in the right place, and
we talk about planting the back gully out and pine
trees if it's covered in gorse or not good grace
in country. But the reality of it is, if you're
looking at production forestry, you haven't got the economy of scale.
It's for these small plantation areas to be economic to harvest.
Speaker 2 (03:16):
No, not really, I've worked out a minimum size economically
and it depends on your access is around ten head
tears because it costs you a bit to get the
big gear into harvested, and the optimum size to get
the really big efficient high performance production gears around thirty
head tears, which is about a summer's worth of harvesting.
So yeah, unfortunately, the little bits here and there, great idea,
(03:41):
but they end up costing more than what it's worth.
You're better off to go and to say, I mean
popular poles on stephole country is a great option, but
we're also growing a lot of ground durable eucalypse for
poles for the vineyard industry. And of course you get
this haul them out with the track and build them
on the spot up square and then haul them out
the tractor trailer. So any tree is useful. You just
(04:02):
get the right tree right place.
Speaker 1 (04:04):
Are we still seeing carbon farming as a standalone venture
where people basically plant pine trees, mainly pine trees, with
a view to never harvesting them, because I'm really anti that.
Speaker 2 (04:17):
Yeah. Look, I can't think of any specifically that have
gone on recently because there have been some legislation clamping
down on it. But you look at some of that
then right up the back of Roratoria and back in
the barer. That's very scary and hard to get access to.
It's a viable land use, and effectively the beauty with
carbon farming is that you muster up with a computer
mouse and I've got some ideas what we might do
(04:40):
after the first rotation. That could be another subject, Amie,
but you know, it's once more, it's a land use.
It's viable in some situations.
Speaker 1 (04:48):
Are you not worried that with the spray and walk
away mentality of carbon farming, with climate change, the East
Coast getting drier under climate change, that we're going to
have a massive forest fire.
Speaker 2 (05:01):
That is a real, real worry. You're absolutely right, because
then it's a huge lease of carbon and that I
was just about to say the word but I shouldn't
on the radio. You have to beat me out. Yeah,
it is a worry. In our own situation, we're very
careful about having green belts between our forestry blocks. We
have sort of seventy hectar blocks in places, but we
make sure we've got green belts. Nobody has given very
(05:23):
good thought on the fire risk, and it's going to
be a calamity. No doubt about it.
Speaker 1 (05:29):
If you're a carbon farmer and your forestry goes up
and smoke, you're gone. You've lost your entire investment. Do
you have to pay back the carbony? Do you have
to pay back the carbon credits?
Speaker 2 (05:41):
Yeah? Absolutely. Unfortunately, I see some dodgy operators who basically
go and they load up the land of trees, they
grab the carbon, they run away, change the company name,
or crash the company, and then somebody else has held
left out holding the sins in black baby. So that's sadly.
There's people seen the loopholes and remember where there's confusion
(06:06):
is opportunity, and some bright people have seen the loopholes
and exploited hell out of them.
Speaker 1 (06:11):
What are the returns, Like, let's put carbon farming to
one side forestry at the moment, the return on logs
as I understand that it's down, how does it compare
like for like with running sheep on marginal country.
Speaker 2 (06:24):
Yeah, good point. The price is down with it, but
it's still it's still realistic to harvest now it chops
and changes every day. Of course, sheep or sheeps down
beef is not too bad at the moment. It is
still an economic land. Use the beauty with forestry, and
we've got a similar situation. We've been waiting for a
couple of years to harvest one block because the price
(06:47):
has been down. But unlike cheap they don't cut their
teeth and suddenly become worthless. So you know, the cost
of holding them is only a financial cost. Usually you're
going to sit there and wait. You know, hopefully you're
going to get the income from it. But an actual fact,
you can sit weight and if your trees are prone,
which they should be, that's adding higher value clear woods.
So the actual value proposition does increase as well.
Speaker 1 (07:09):
Now, I noticed from your presentation to the Real Estate
Institute or whatever that you talked about optimum conditions for
growing pine trees, and I noticed that one of those
optimum conditions was having rainfall of about one meter or
one thousand mills in the course of the year. That
wouldn't A lot of the East Coast wouldn't meet that criteria.
Speaker 2 (07:30):
I think you'll find they do, Jamie. It's just that
it all tends to come in the winter, and that's
the view with forestry is you probably need it more
in the winter. In fact, when we're harvesting, we pray
for a drought because it makes harvesting a lot cheaper
and easier when you're in the winter, planting while they're wet,
get them established, and of course once they've got their
roots down in that subtool you know that, you know
(07:52):
that tends to stay dry, stay wet over dry summer,
and we have we've learned that probably is around us
for irrigation. We tend to make more for hector out
a forest free in a dry year than they do
out of arrogation. So yeah, I don't think that that's
a major worry. You're just going to choose your timing
when you plant. There's a key point.
Speaker 1 (08:11):
Look a final question for you in terms of the
value of carbon, what did you say fifty or sixty
bucks a ton or whatever? There was talk of it
going to like two hundred and fifty dollars a ton.
Is that realistic? Because if it got to that level,
Mark Warren, everyone would be planting pine trees.
Speaker 2 (08:26):
Yeah, but you're going to remember the best time to
plant the tree is now, or that actually was twenty
years ago, and the second best time is now. The
problem is that when it gets to that level, everyone's
going to raise them and find plant trees. You won't
have any seedlings, you won't have any people capable. So
one hundred and twenty two forty whatever it is, who knows.
(08:47):
All we do know is that there's no logic to
the whole thing. And where I sold well, I won't
say when I sold it for a while ago, but
there have been prices well under the eighties in the
last couple of years, and even last year there was
a spike up for seventy five for a split second.
It was at sixty bucks yesterday, fifty dollars at the
beginning of the week. So it's all over the place.
(09:07):
It's a lovely game to play when you're felling down
the dumps and you look at your carbone. Account if
it's up, if you're quite pleased. If it's down, you
just don't look well.
Speaker 1 (09:14):
There you go, Mark Warren, thanks for your time. Enjoy matchism.
I think at the Hypocral hall it tonight. Always good
to catch up.
Speaker 2 (09:22):
All good mate, all this hag am
So you've heard from doctor Jenny Webster Brown, author of
the White Paper Y Pines. Let's talk to someone at
the coalface Central Hawks May sheep and beef farmer and
forester Mark Warren. You might remember his book Many Muddy Morning.
Speaker 2 (00:16):
Mark.
Speaker 1 (00:16):
You've come out with a presentation and it's titled is
Production Slash Carbon Forestry the New Diamond Mining? Are you
like Shane Jones who's already been on the show today,
do you want to plant the entire east coast of
the North Island and pine trees?
Speaker 2 (00:34):
Jamie, No, not at all. My mantra is always is
the right tree, right place. You've got a hardhill country place,
you know probably ten to fifteen possibly twenty five percent
is much more productive and profitable, and you know, good
production forestry and also stabilizing soil. So no, don't plant
(00:55):
the whole lot. That's an absolute crime against humanity. Okay.
Speaker 1 (00:58):
Now, I know you've done well and you've got into
farming in the tough years the eighties, and over that
time you've done well out of farm forestry. Of course,
now you've got two bites at the cherry. You've not
only got the production forestry, you've also got the carbon credits.
Is now a great time for farmers to plant some
of their farms and to pine trees.
Speaker 2 (01:19):
Well, it's a great way of generating a bit of cash.
But please don't say that I'm advocating for it, well
the whole eighty yes, because I don't necessarily believe it.
Don't shoot me. I'm only the messenger. But it's certainly
a great option to generate a bit more cash out
of the system. Just remember, the carbon credit systems a
little bit like rural bitcoin, and any industry created by
(01:42):
the stroke of the pen can disappear with a stroke
of pen. So yes, it's been great, but you know,
it's a little bit like a bureaucratic a big bag
of candy floss, really, and it all looks good until
you squeeze it right down and the bug all lesson.
Speaker 1 (01:54):
Well, Mark, I reckon. It's got a bit of a
whiff of the Emperor's new clothes about it.
Speaker 2 (02:00):
Yeah, it has a little bit. You know, it suddenly
jump ten percent this week up for sixty bucks. My
numbers were done on at about fifty four for that presentation.
They're all Rual Estate Institute. But yeah, look it's it's
hard to know if it's really viable long term. But
in our case it meant that we could balance the
(02:21):
books and not make a loss last year in sheep farming,
which apparently was quite hard to do. So it's got
some benefit. But it's followed little bureaucratic fash books. And
I've got to say that MPI have just grayed huge
amounts of confidence measuring it all. And what I'm saying
that if anyone else has noticed, their maps have had
just lines drawn across from on land that should be
(02:43):
included for forestry accessible for ets has been rejected in
an out case, They've each included land that never should
have been included. So you're dealing with some people there
that I won't see the name on radio, but it
defies logic.
Speaker 1 (02:57):
You talk about right tree in the right place, and
we talk about planting the back gully out and pine
trees if it's covered in gorse or not good grace
in country. But the reality of it is, if you're
looking at production forestry, you haven't got the economy of scale.
It's for these small plantation areas to be economic to harvest.
Speaker 2 (03:16):
No, not really, I've worked out a minimum size economically
and it depends on your access is around ten head
tears because it costs you a bit to get the
big gear into harvested, and the optimum size to get
the really big efficient high performance production gears around thirty
head tears, which is about a summer's worth of harvesting.
So yeah, unfortunately, the little bits here and there, great idea,
(03:41):
but they end up costing more than what it's worth.
You're better off to go and to say, I mean
popular poles on stephole country is a great option, but
we're also growing a lot of ground durable eucalypse for
poles for the vineyard industry. And of course you get
this haul them out with the track and build them
on the spot up square and then haul them out
the tractor trailer. So any tree is useful. You just
(04:02):
get the right tree right place.
Speaker 1 (04:04):
Are we still seeing carbon farming as a standalone venture
where people basically plant pine trees, mainly pine trees, with
a view to never harvesting them, because I'm really anti that.
Speaker 2 (04:17):
Yeah. Look, I can't think of any specifically that have
gone on recently because there have been some legislation clamping
down on it. But you look at some of that
then right up the back of Roratoria and back in
the barer. That's very scary and hard to get access to.
It's a viable land use, and effectively the beauty with
carbon farming is that you muster up with a computer
mouse and I've got some ideas what we might do
(04:40):
after the first rotation. That could be another subject, Amie,
but you know, it's once more, it's a land use.
It's viable in some situations.
Speaker 1 (04:48):
Are you not worried that with the spray and walk
away mentality of carbon farming, with climate change, the East
Coast getting drier under climate change, that we're going to
have a massive forest fire.
Speaker 2 (05:01):
That is a real, real worry. You're absolutely right, because
then it's a huge lease of carbon and that I
was just about to say the word but I shouldn't
on the radio. You have to beat me out. Yeah,
it is a worry. In our own situation, we're very
careful about having green belts between our forestry blocks. We
have sort of seventy hectar blocks in places, but we
make sure we've got green belts. Nobody has given very
(05:23):
good thought on the fire risk, and it's going to
be a calamity. No doubt about it.
Speaker 1 (05:29):
If you're a carbon farmer and your forestry goes up
and smoke, you're gone. You've lost your entire investment. Do
you have to pay back the carbony? Do you have
to pay back the carbon credits?
Speaker 2 (05:41):
Yeah? Absolutely. Unfortunately, I see some dodgy operators who basically
go and they load up the land of trees, they
grab the carbon, they run away, change the company name,
or crash the company, and then somebody else has held
left out holding the sins in black baby. So that's sadly.
There's people seen the loopholes and remember where there's confusion
(06:06):
is opportunity, and some bright people have seen the loopholes
and exploited hell out of them.
Speaker 1 (06:11):
What are the returns, Like, let's put carbon farming to
one side forestry at the moment, the return on logs
as I understand that it's down, how does it compare
like for like with running sheep on marginal country.
Speaker 2 (06:24):
Yeah, good point. The price is down with it, but
it's still it's still realistic to harvest now it chops
and changes every day. Of course, sheep or sheeps down
beef is not too bad at the moment. It is
still an economic land. Use the beauty with forestry, and
we've got a similar situation. We've been waiting for a
couple of years to harvest one block because the price
(06:47):
has been down. But unlike cheap they don't cut their
teeth and suddenly become worthless. So you know, the cost
of holding them is only a financial cost. Usually you're
going to sit there and wait. You know, hopefully you're
going to get the income from it. But an actual fact,
you can sit weight and if your trees are prone,
which they should be, that's adding higher value clear woods.
So the actual value proposition does increase as well.
Speaker 1 (07:09):
Now, I noticed from your presentation to the Real Estate
Institute or whatever that you talked about optimum conditions for
growing pine trees, and I noticed that one of those
optimum conditions was having rainfall of about one meter or
one thousand mills in the course of the year. That
wouldn't A lot of the East Coast wouldn't meet that criteria.
Speaker 2 (07:30):
I think you'll find they do, Jamie. It's just that
it all tends to come in the winter, and that's
the view with forestry is you probably need it more
in the winter. In fact, when we're harvesting, we pray
for a drought because it makes harvesting a lot cheaper
and easier when you're in the winter, planting while they're wet,
get them established, and of course once they've got their
roots down in that subtool you know that, you know
(07:52):
that tends to stay dry, stay wet over dry summer,
and we have we've learned that probably is around us
for irrigation. We tend to make more for hector out
a forest free in a dry year than they do
out of arrogation. So yeah, I don't think that that's
a major worry. You're just going to choose your timing
when you plant. There's a key point.
Speaker 1 (08:11):
Look a final question for you in terms of the
value of carbon, what did you say fifty or sixty
bucks a ton or whatever? There was talk of it
going to like two hundred and fifty dollars a ton.
Is that realistic? Because if it got to that level,
Mark Warren, everyone would be planting pine trees.
Speaker 2 (08:26):
Yeah, but you're going to remember the best time to
plant the tree is now, or that actually was twenty
years ago, and the second best time is now. The
problem is that when it gets to that level, everyone's
going to raise them and find plant trees. You won't
have any seedlings, you won't have any people capable. So
one hundred and twenty two forty whatever it is, who knows.
(08:47):
All we do know is that there's no logic to
the whole thing. And where I sold well, I won't
say when I sold it for a while ago, but
there have been prices well under the eighties in the
last couple of years, and even last year there was
a spike up for seventy five for a split second.
It was at sixty bucks yesterday, fifty dollars at the
beginning of the week. So it's all over the place.
(09:07):
It's a lovely game to play when you're felling down
the dumps and you look at your carbone. Account if
it's up, if you're quite pleased. If it's down, you
just don't look well.
Speaker 1 (09:14):
There you go, Mark Warren, thanks for your time. Enjoy matchism.
I think at the Hypocral hall it tonight. Always good
to catch up.
Speaker 2 (09:22):
All good mate, all this hag am
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