Hidden assets: Asia’s smallholder wood resources and their contribution to supply chains of commercial wood

Influenced by increasing population and prosperity, global wood needs are expected to treble by 2050, and an increased dependence on plantations will see demand for planted wood grow from 500 Mm3 to 1500 Mm3 over the next 30 years. Expansion of planted wood resources using conventional commercial plantation models is challenged in the crowded landscapes of Asia, where land tenure, access and ownership are ambiguous and it is unlikely that conventional plantations will be able to expand to meet demand. Forest assets managed by smallholder tree-farmers already make substantial contributions to national forest assets, wood production, exports and national incomes, and their role in wood production will become increasingly critical to meeting society’s needs. Benefits arising from the raw materials they produce are largely unrecognised in official statistics, partly because the many thousands of small stands of trees are widely scattered and flexibly managed by numerous tree-farmers as ‘living bank accounts’, being strongly influenced by emergency needs for immediate cash to satisfy family and social obligations. Using available data and credible assumptions, the probable contributions of smallholder assets to national economies and smallholder livelihoods have been calculated for acacias in Vietnam and eucalypts in Guangxi Province, China, along with smallholder contributions to commercial wood flows in several other Asian countries. More than 600 000 ha (equivalent) of unaccounted acacia smallholdings and informal plantings in Vietnam, annually produce more than 9 Mm3 of wood worth (as export woodchips) in excess of US500 M. In Guangxi, commercial smallholder forest stands amount to about 800 000 ha of eucalypts, and produce in excess of 12 Mm3 of wood annually. This Chinese resource generates considerable employment and raw materials to industry worth over US2. 4 bn (bn; 1bn = 1 000 000 000) after local primary processing. In India, sales of commercial logs grown by smallholders add over US700 M annually to rural economies and similar examples are offered for Lao PDR, Indonesia and Thailand. The numerous opportunities and impediments in smallholder forestry are discussed, with consequences for national policies. The role of traders within the forest products value chain is examined, and forest certification and the burden of compliance with complicated and onerous laws and regulations are discussed. Smallholder tree-farmers are entrepreneurs who expect their investments in smallholdings to produce financial (and other) benefits. Collectively, they represent multi-billion-dollar regional businesses, increasing incomes for many millions of households and creating significant national assets. To succeed, smallholder tree-farmers need the conditions summarised in 2001 as Byron’s ‘Four Keys’: (i) clear ownership of trees; (ii) reliable markets; (iii) sympathetic legal and regulatory frameworks; and (iv) a robust package of technical options. Reliable value chains and risk mitigation are important issues, and severe impediments in any of the ’Four Keys’ jeopardise the efficiency and effectiveness of the forest products value chain, the livelihoods and financial sustainability of the smallholder tree-farmers, and their substantial contributions to national productivity and forest assets.