Land use change and forestry expansion of smallholders in New Zealand : an economic analysis

Abstract

In New Zealand the involvement of smallholders has increased in forestry plantations in response to policies and market changes during last few years. This study examines the factors determining having forests and extent of land use in plantation forestry (if planted) for these smallholders. Data collected via a mail survey of 349 landholders from four districts of the South Island were analysed using various statistical and econometrics methods. Factors explaining probability of land use in forestry include landholding size, land suitability, period running property, perceived relative profitability of forestry, limitations for plantations, tax policy encouragement, off-farm self employment and off-farm income. Similarly, factors determining extent of land use in plantation forestry are landholding size, land suitability, perceived relative profitability, financial problems, plantation objective, tax policy awareness, information sources for forestry establishment and management, places of residence, annual income level, occupation, off-farm income and region. The extent of land use in forestry was evaluated in terms of land potentially profitable under plantation forestry as declared by landowners. The study indicates there is further potential for forestry expansion.