Some Observations on the Economic Value of Dual-purpose Foretry in the Wairau River Catchment

Authors: R.S. Macarthur
Publication: New Zealand Journal of Forestry, Volume N.Z.J.For. 1971, Issue N.Z.J.For. 16(1) 1971, pp 46-60, May 1971
Publisher: New Zealand Institute of Forestry

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Abstract: The Wairau River catchment is selected as an example where dual-purpose forestry is likely to play a significant part in watershed management. The effect of applied watershed conservation and river control measures is briefly described. The area of steepland likely to require ultimate forest conservation treatment, either in whole or in part, is estimated to be approximately 402,000 acres. This has been classified into three categories of (a) 84,000 acres of short-rotation commercial forest species, (b) 88,000 acres of long-rotation commercial forest species and (c) 230,000 acres of high altitude steepland for which the major requirement is revegetation principally with grass, legume, scrub and some forest species. The commercial wood value of this latter category would be nil to slight, but on-site erosion control values would be high and considerable (although ill-defined) indirect off-site benefits are likely to accrue from this treatment.
From flood records data and catchment conditions postulated by Thomson (1965) it is assumed that the reforestation of all the areas cited would have considerable on-site and off-site benefits. These are listed and evaluated in monetary terms over an 80-year period. These benefits and associated costs are then discounted to present value using an arbitrary interest rate of 5%.
As the benefit/cost ratio thus obtained has a value close to 1.0 it is concluded that a major steepland conservation and reforestation programme of the upper Wairau catchment is reasonably justified even when intangible benefits are ignored.
It is further concluded that the analysis, besides clarifying logical priorities, also indicates the necessity for an integrated whole catchment approach as well as considerable justification for greatly increased research on the costly and extensive high altitude revegetation work.

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