INVESTIGATING POTENTIAL BUSH PRODUCTS in the GREAT SOUTHERN

SWAMP SHEOAK FEASIBILITY STUDY

for Green Skills Inc by Rod Safstrom Environs Consulting Pty Ltd Box 616 Mundaring 6073 [email protected] in association with

Bruce Robinson, Robinson Rural Consulting Wayne O’Sullivan, Arboressence Consultancy

March 2002 Investigating Potential Bush Products in the Great Southern Western Australia

Reports

This report comprises part of a series of reports for the Bush products project. Other reports include: • Summary report • Species database • Ethnobotanical database • Similar projects and key individuals • Farmer interviews • Warrigal greens feasibility study • Sandalwood nuts feasibility study • Blister bush pre-feasibility study.

Acknowledgments

This report is substantially the work of Bruce Robinson with input from Rod Safstrom, Wayne O’Sullivan and the Steering Committee.

Ellen Hickman provided the artwork.

Much of the information is based on an unpublished paper by Peter White (2001). His support in providing this material for the project is gratefully acknowledged.

This project is funded by the federal Department of Employment, Workplace Relations and Small Business, the WA Department of Training and the Great Southern Development Commission.

Louise Duxbury, Green Skills Denmark, guided the project.

The Steering Committee for the project included: Louise Duxbury Green Skills Bud Coe, Southern Aboriginal Corporation Sally Haigh, Great Southern Development Commission Louise Hillman, Regional Employment Coordinator WA Department of Training Julia Levinson, Executive Officer Timber 2002 Gary Muir, Wild Over Walpole Charles Patterson, South Coast Regional Initiative Planning Team (SCRIPT) Michael Power, Farm Forestry Officer Department of Conservation Chris Robinson, Department of Agriculture Graeme Townley, Great Southern Development Commission Len Van der Waag, Executive Officer Great Southern Area Consultative Committee Kelly Flugge, Indigenous Landcare Facilitator SCRIPT Charles Burleigh Farmer & Biochemist Ruth Speldewinde, Landcare Enterprise Officer SCRIPT Investigating Potential Bush Products in the Great Southern Western Australia

SWAMP SHEOAK ( obesa) – FEASIBILITY STUDY

1. Background

• Distribution

Casuarina obesa is a species native to South Western Australia and is widely planted for revegetation purposes on semi saline waterlogged land.

The grows in semi arid areas with a minimum rainfall of 125 mm (50 percentile is 250-500mm) (Doran and Hall, 1983) and a cool to warm temperate climate. It is highly frost resistant, grows in soils with a pH of 6.0 – 8.5, has moderate salt tolerance (growth rates are reduced when salinity reaches 150 – 200 mS/m using an EM38) and occurs in low lying areas that are subject to inundation. The tree grows on a number of soil types ranging from grey clays to a duplex soil over clay. It is also very common in deep sandy duplex and clayey sands, especially depositional areas of waterways and flood planes (O’Sullivan pers. comm. 2002) Its preferred soil type would be a gradational soil eg a clay loam grading into a medium clay (White, 2001).

• Cultural Characteristics

- Casuarina obesa is dieback tolerant, it fixes nitrogen and is an outstanding coloniser that suckers freely. - It is easily propagated and can be direct seeded. - The tree grows rapidly but is very susceptible to grazing damage from stock, rabbits, kangaroos and insects. - The biology of Casuarina obesa lends itself to rapid genetic development (Barbour pers comm, 2002) - Casuarina obesa grows to a small tree of 14 metres high and with pruning can have a clean bole and be relatively straight (Midgley, 1981 in White, 2001). The trunks of mature are commonly heavily fluted and this may reduce the recovery of sawn material (McFall pers. comm. 2002). The same condition is common in other Casuarina species (O’Sullivan pers. comm. 2002). - In its natural state the tree tends to grow multi-stemmed and requires regular pruning to produce good timber. - Casuarina species have excellent tolerances of a wide array of adverse environmental conditions (Midgley, 1981 in White, 2001)

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 2 • Timber Properties

- Based on observations of Casuarina obesa and supported by observations of Rock Sheoak ( huegeliana) it may be possible for selected obesa trees to reach a millable size in 20 – 25 years (White, 2001). - Trial sawing and finishing work of Casuarina obesa by CALM has indicated a number of favourable timber properties giving the timber the potential to be introduced for cabinetwork and a range of wood products. In sawmilling trials at Harvey on a scale of 1 – 5 (1 poor) (5 excellent) Swamp Sheoak was ranked at 4 for sawing, sanding and planing. The timber is stable and accepts gluing. - The timber produced is an attractive pale timber with a straw to creamy- brown colour. However, opinion on the attractiveness of the timber did vary with a perception by some that it was bland. This will require further market testing. The timber samples prepared for the Department of CALM in the Harvey trial were a uniform pale brown colour, but two trees milled recently by Chris Robinson (pers. comm. 2002) at the Department of Agriculture, Albany, showed an attractive pink colour in the heartwood that may significantly increase its market appeal. This needs to be followed up, as the colour variation may be a provenance difference. - The timber of the other members of this genus (as well as the closely related Allocasuarina) is in high demand (Midgley, 1981 in White, 2001). The co-ordinator of the Dwellingup School of Wood, indicated that light coloured native timbers were not readily available and that imports from the Eastern States were necessary to satisfy demand (Harris, 1999 in White, 2001). - Casuarina species have densities in the range of 750 - 900 kg/m3, which is good enough for flooring. Being slow growing, obesa would probably be in the same range (Bartle Pers Comm, 2002). Densities in fast growing plantation timber will have to be investigated. - Possibilities exist for the use of this timber for flooring if sufficient was available and could be grown to an adequate dimension (Donnelly in White, 2001). The possibility also exists for tool handle manufacture (White, 2001). - The timber is good quality firewood and is also being trialed as fence posts (White, 2001).

• Industrial Development

To date, apart from the work done by Peter White and Bill Hollingworth (Proprietor of Bandicoot Nursery), there appears to have been relatively little work done on this species. Dr Liz Barbour, Manager Seed Technologies, Forest Products Commission was, however, keen to do joint genetic trial work on the tree. Her hunch was that potential productivity gains could be made, especially because of the possibilities to make rapid genetic gains as a result of the relatively short generation span and because it is found over a broad area. The species has a good genetic resource from which to work (White 2001).

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 3 - Casuarina obesa has potential as biomass for shorter rotation products such as particleboard or for gasification for bio fuels and is reputed to be an excellent species for charcoal production. However, this is beyond the scope of this report to investigate properly.

• Revegetation Value

The main benefit of Casuarina obesa is that it grows on saltland in medium to low rainfall areas. Its timber producing capacity could be treated as a bonus. It is a proven performer as a revegetation species and has high levels of farmer acceptability for this purpose. It fits in neatly for funding under the current and predicted guideline for NHT funding (Hollingworth and White, 2001), however potential timber species may not be funded.

2. Product Description and Business Objective

Swamp Sheoak could lend itself to the development of a combination of products including:

- High Grade Appearance Timber for furniture, flooring and panelling. This timber would be derived from standard length sawlogs produced at 25 years.

- High Grade Appearance Timber for the craft wood market. This timber would be derived from the shorter sections of the sawlogs produced at 25 years.

- Fence posts produced from thinnings at Year 9 and Year 12. These thinnings would be CCA treated (possibly contract) prior to sale as posts.

- Amenity Value as a landcare woody perennial that helps lower the water table and wheatbelt salinity. In this instance the product would be Casuarina seedlings which would be produced by a nursery such as the Bandicoot Nursery in Mt Barker.

- Fire wood. Using the residual offcuts from either the thinning or the harvest of mature trees.

It is also conceivable that Swamp Sheoak could be used as: a source of chip for the paper industry; or as a biomass source for the production of bio-fuel; or for producing activated carbon etc. However, the scope of this feasibility study has not stretched to the consideration of these options.

• The business objective would be bifocal. On the one hand, the aim would be to develop products that generate a commercial return and, on the other hand, the aim would be to help ameliorate the salinity problem via the introduction of a woody perennial into the landscape.

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 4 • The objective would be to develop a Casuarina obesa industry rather than just a single enterprise. The industry would include enterprises for: nursery seedlings production; production of sawlogs and fence posts via individual farmers or prospectus companies; contract milling and post treatment enterprises; cabinet making businesses, craft businesses etc.

• Bandicoot Nursery in Mt Barker is an obvious business champion, as is Norm Bario of Minorba Grazing Co for the treatment of fence posts.

• Hans Fleck would, no doubt, welcome opportunities to market his craft timber sawing equipment or possibly to contract mill timber.

3. Market Assessment

3.1 Market Demand

• Even though Australia produces significant quantities of sawn timber (3.66 million m3 in 1997/98), 21% of all sawn timber is imported (784,000 m3 in 1997/98). Anecdotal evidence suggests that crafts people cannot get enough Wheatbelt timbers, and if more was available they would use it (AgWA, 1999). To the man in the street, it is obvious that good quality timber is becoming a scarce commodity and as a result demand and price are likely to rise in the future. Increasing numbers of fast growing eucalypts are being established on farmland for saw log production, based on a range of Eastern States species. This is more likely to result in a replacement of structural grade timber supplies currently sourced from native forest areas, rather than the feature grade woods.

• Where there are no existing industrial markets to tap into it makes sense for an agro-forester to produce high value, high quality products, such as large diameter high pruned sawlogs. This especially applies to products with limited existing markets and where available volumes are small and where harvesting and transport costs are relatively high (Bulman, 1998).

• The recent boom in viticulture and the aging War Service Land Scheme (WSLS) fences in say the Jerramungup area should produce demand for fencing material eg 100 – 125 mm small end diameter posts. Thinnings from the eucalypt plantations are being treated for this purpose, but have suffered from bad splitting problems.

• Craft wood is sought after and sold by the kg for wood-turning and sculpture. A reasonable retail price for craft wood such as mulga (Acacia aneura) would be about $3/kg.

• There appears to be a very high demand for seedlings for salt tolerant revegetation programs. Of the 1.3 million seedlings produced at

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 5 CALM’s Wheatbelt Nursery, 107,300 (8.2%) were Casuarina obesa (T Sprigg in White, 2001). The demand for appearance grade timber for local, and possibly overseas, markets appears high and there appears to be moderate demand for craft wood and firewood. Although an excellent firewood, market resistance will be difficult to overcome as the product is not known by the consumer.

• The prices that could be expected for the various Casuarina obesa products are as follows: - Seedlings sold for 30 cents each - Fence posts (untreated green) $2/post ($70/m3) (treated) $4.50 - $6.00/post - Saw logs (short) $50/m3 - Saw logs (long) $70/m3 - Seasoned sawn timber $1800/m3 (Gabby in White, 2001) - Seasoned Flooring $8000/m3 (Bulman in White, 2001)

• There is anecdotal evidence that the demand for flooring timber is expanding at 3% per annum.

• The maximum number of C. obesa seedlings likely to be required in any year is about 5 million @ 30 cents = $1.5M per annum.

• Bulk wood products (eg chips etc) are not likely to be profitable to produce if they have to be transported more than 150 kms. A farm gate price for bulk wood products still needs to be determined.

• Landcare and conservation values may dictate that thinnings are better left in situe, on degraded sites in particular, as their value in reducing evaporation, providing habitat, nutrient recycling etc may exceed the off farm value. This approach may also be a marketing tool for environmentally sound plantation management, especially to overseas markets.

• Customers are likely to seek the following benefits from Casuarina obesa: - Timber appearance is a nice light timber. This is appealing to clients in the Northern Hemisphere in particular. - Plantation grown, rehabilitating salt land and is a renewable product that will improve land values - A native species that is doing the job - A drought tolerant species

• Customers of Casuarina obesa timber products would want an assurance that there would be continuity of supply. The majority of clients would want seasoned timber and plantation timber can be more difficult to season, although the technology for doing this is improving (Hollingworth and White pers. comm. 2002).

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 6 3.2 Competition

• Casuarina obesa would compete well as a revegetation species in salt lands. There is strong demand for a commercial species for saline ground.

• Seasoned Eucalyptus globulus will be a competitor. It is also a light coloured timber but is not durable enough to compete in the flooring market. However, globulus trials for a number of existing markets are underway whereas none of this work has been started for C. obesa.

• Pine posts dominate the fence post market. This market would be difficult to break into. Treated pine posts are currently being imported from South Africa to meet demand.

• Other Casuarina (tree) species could provide some competition – they could also provide some synergistic support. Growers could grow a range of Casurina and Allocasuarina species with the aim of producing a variety of timber products with similar management and marketing requirements.

3.3 Industry Trends

• There has been reduced access to native forest areas. With declining supplies of high grade hardwood logs from traditional sources, such as the tropical rainforests of south East Asia and our own Karri and jarrah forests, there are opportunities for private growers in WA to produce and sell hardwood sawlogs (Moore, 2000).

• There has been a shift away from using timber framing to steel in housing construction.

• The taxation commission is looking at plantation schemes much more closely and tax breaks may be less in the future. Tax breaks for sound and genuine plantations will probably continue to be a reality, but the bad publicity associated with recent investigations into questionable schemes has given the industry a tarnished reputation and may have reduced the pool of potential investors.

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 7 3.4 Product Idea Screening Pro-forma

Species: Casuarina obesa (Power & Robinson, 2002)

Product Idea 1. 2. 3. 4. 5. Product High Grade Craftwood Fence Posts Amenity Value Firewood Description Appearance for Landcare

What is the Timber for Shorter sections Product/Service? furniture, paneling, Quality, flooring etc Appearance, Packaging Target Market - Is there a market for this product? Yes Yes Some Yes Yes - Opportunities Local, Perth, Initially Local Local Demand for a Local Overseas then Perth salt tolerant tree - Value to customers (0 low 10 high) 7 5 3 10 4 Competition - Ability to do Other Sheoak Other Sheoak Difficult to Difficult to better than Spp may not Spp may be break into break into competition compete as complimentary pine market market darker with different & Bluegum dominated by coloured colours posts jarrah (0 low 10 high) 5 3 2 10 6 Market Size 6 M ha salty land (Large, Medium, Potentially Small) large Small Small/med Large Small Economic / Social - Increase - Big, positive. - Dwindling Factors - Dwindling - Harder to in There is a native native obtain vineyards need for a forests forests - Increased - WSLS commercial supplies popularity of fences spp. for saline - Less home texture wood aging ground but fires due to growth will green house be slower pressure to reduce Product Price

$70/m3 $70/m3 $70/m3 30c/seedling $100/t $2/post (35/m3)

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 8 Product Idea 1. 2. 3. 4. 5. High Grade Craftwood Fence Posts Amenity Firewood Appearance Value for Timber Landcare Development Time and Cost Medium

Density (Large, Large Medium Medium Small increases with Medium, Small) age Manufacturing costs

(Large, Medium Small Medium Small Small Medium, Small) Technical Aspects Determining Wood Probably non Already Suitability milling, characteristics durable proven - Leaf value (What drying and and suitability therefore - Cash technology is timber for craftwood needing - splitting most characteristics industry treatment important?) Logistics Require Will industry Minorba Widely Cartage to adequate pay for wood Grazing Co planted for markets will be resource to v’s free wood has facility. this purpose a factor supply from native Transport already processing source at issue facility and present? markets Operational - Milling and resources Drying Nursery required facility capacity is - Farmers there would need to prune (Large, Medium, Small) Medium Small Small/med Small Small R & D requirements Existing

(Large, Medium, Small) Medium Small Small/med Small Small Level of Risk Depends on Competition buyers from other acceptance source eg and globulus (Large, willingness Medium, Small) Large Medium Large Small Large Level of (Low margins) Large land (Low margins) Return conservation (Large, value Medium, Small) Medium Small Small/med Large Small Product Idea Rank Order 2 4 3 1 5

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 9 Summary

On the basis of this preliminary screening of product ideas it does appear as though the production of seedlings for landcare purposes has a high sustainable competitive advantage – the market is large, the ability to compete is good, development and operational costs are small, R & D is done and the level of risk is small.

It also appears that the development of high grade appearance timber products could be worth pursuing as a parallel venture to provide a commercial return. The development of timber for commercial returns will be what drives the project.

Fence posts from Casuarina obesa will face significant competition and there may be a higher and better use for the thinnings than this. Much of this market is local, and there is always demand at local level for replacing old fences, landcare fencing, local employment. Kept small and local it could be sustainable.

3.5 SWOT Analysis

3.5.1 Strengths • A species proven to grow in dryland salt affected areas • Good structural properties for timber when pruned • Fits in with current guidelines for NHT funding (for landcare planting) • Light coloured timber is fashionable • Will grow on low value land and help rehabilitate it • Nitrogen fixing plant • Excellent charcoal producer • Tolerates drought, waterlogging, salt – reducing risk of failure • A large pool of genetic material to select from and a short generational time span • Older trees have darker heartwood that is attractive • Will grow better on better land in low rainfall areas

3.5.2 Weaknesses • A somewhat bland style and appearance • Slow growing – 25 years before high grade saw log can be obtained (this is actually very fast in forestry terms! Growth is comparable to eucalypts, better than pines and most other species) • Current provenances require detailed and timely pruning if a high vale product is to be achieved • Minimal research on the wood and silvicultural practices • Rock Sheoak has more attractive wood (although dark colour may reduce market size)

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 10 • Susceptible to grazing damage and parrots

3.5.3 Opportunities • Rehabilitate salt affected land • Prune the trees to develop millable sawlogs after 25 years for use as flooring/panels etc • Produce fence posts from thinnings • Shorter logs for craft wood industry • Biomass production for fuel, paper, activated carbon etc • Grazing between trees whilst growing • 60% improvement with breeding improvement in yield of millable timber (less branching, faster growth, less fluting, etc) • Business opportunity for tree management teams

3.5.4 Threats • Fire burning down stands • Fashion changing demand for light timber • Farmers not prepared to adopt cultural change required to prune trees • Shorter growth cycle timbers such as E. globulus outcompeting C. obesa

3.6 Sustainable Competitive Advantage

Casuarina obesa will win if:

• It is marketed on its ability to produce a high quality appearance grade timber that can be value added to produce flooring and panelling marketed at a premium price with the thinnings sold for fence posts whilst rehabilitating salt affected wheatbelt lands at the same time

• Continunity of supply is guaranteed by developing large scale, well managed plantations

• NHT funding is secured to encourage plantings

4. Capability Statement

4.1 Supply

• The supply would probably be limited to those areas in which Casuarina obesa grew naturally. That is low lying areas subject to seasonal inundation (Midgley in White, 2001). However, given that about 1.8 million ha of formerly productive land or 10% of Western Australia’s farmed area is affected by salinity, there should be ample area to support a supply base for Casuarina obesa. Whether or not an adequate supply base can be achieved will, to a large extent, depend on farmers’ perceptions

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 11 about the profitability of growing the tree and its associated landcare benefits.

• If the 107,300 seedlings of Casuarina obesa sold by CALM’s Narrogin Nursery in 1998 were planted at a density of 1,111 s/ha then this would occupy an area of almost 100 ha. Therefore, the number of seedlings produced would have to increase considerably if any scale of planting was to be achieved.

4.2 Technical Aspects

White (2001) suggests the following silvicultural management: - a rectangular or square plantation configuration to maximise tree form and allow control of stock at least in the initial years - Planting density 1,111 stems per hectare (3m x 3m spacing) - Pruning Year 1 Form prune Year 5 Prune Year 9 Thin/prune Trees 15 cms diameter. Thinned to 500s/ha or 4.5 x 4.5m spacing Year 12 Thin/prune Trees 22 cms diameter Thinned to 250s/ha or 6.3 x 6.3 m spacing Year 18 Thin/prune Trees 32 cm diameter Thinned to 100s/ha or 10 x 10m spacing

Pruning is necessary to produce high quality sawlogs and from the observations of the plantation of obesa at Mt Barker, it did appear as though even more frequent pruning than that indicated above will be required.

- Production Expected round timber volume production (White, 2001) Bole L.E.D. Volume m3 x form Stems / Product: Product: Total Age (m) (mm) (m3) factor (0.8) thinning fencing sawlogs m3 9 2 157.5 0.04 0.03 600 18.69 18.69 12 4 210 0.14 0.11 250 27.69 27.69 18 5 315 0.39 0.31 150 46.73 46.73 25 5 437.5 0.75 0.60 100 60.10 60.10 46.38 106.83 153.21

Heavier thinning earlier is another option that will increase internal rates of return. However, whatever thinning option is adopted, selling the thinnings will be crucial to achieve a profitable outcome.

- Pricing. The actual price received for saw logs can only be an estimate until the market can be tested commercially. Fence posts have been budgeted at $2 each and sawlogs have been budgeted at $70/m3. - Fire is a real risk. Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 12 - The greatest return to a grower will occur when the grower does as much processing as possible on farm, even to the point of seasoning the timber (Race in White, 2001). It will also be more economical to transport value added product long distances.

4.3 Logistics

• Because of the relative intensity of the necessary silvicultural management practice of pruning required to produce sawlog, it seems unlikely that Casuarina obesa would be grown on a massive scale. For this to occur contract pruning teams would probably be needed and these would only be established if there was sufficient volume of work.

• It seems likely that, unless there were prospectus type plantings, the sawlogs would be transported from farm to a central mill. Fence post material from the thinnings would be taken to a local plant for treatment, and any residue likely to be sold locally as firewood.

4.4 Operational Resources

• Capacity should be available within existing nurseries for the production of extra seedlings required. • Trained labour for pruning is likely to be required. • Machinery for harvesting should be available on a contract basis from the bluegum industry (assuming it has not undergone restructuring by that time). It may also be possible to share some operational resources required with the emerging Oil Mallee Industry. Harvesting and processing may also be done at a farm level, with some existing farm equipment and portable mills (Cremer in White, 2001). The desirability of quarter sawing the timber to best expose the characteristic medullary rays implies that the smaller portable mills and less experienced operators may not be suitable for this operation. • If flooring is to be produced as an end product then the appropriate milling and seasoning infrastructure will need to be established to facilitate this. • An organizational structure that co-ordinates and ensures continuity of supply with market demands will need to be established.

4.5 R & D Requirements

• Possibly the most pressing R& D requirements will be to see if it is possible to achieve a 30 – 60% productivity improvement via genetic selection and to do the field market research, and if positive, develop a robust marketing plan to sell the wood. Research into methods of financing plantation establishment will also be needed. • White (2001) has outlined a comprehensive list of R & D requirements that is attached as Appendix 1.

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 13 4.6 Establishment Costs

• White (2001) has estimated establishment costs of $695/ha (with farmer input, not full commercial rates). Hand planting, rather than direct seeding, is recommended. This will be particularly so if genetic improvement is made and to make maximum advantage of valuable material and control spacing.

4.7 Profitability Estimate

White (2001) has estimated that over a 25 year period Casuarina obesa will yield a Net Present Value of $2,196/ha or an annuity equivalent of $162/ha/year.

The growth estimates upon which these figures are based are attached as Appendix 2, and the net present value calculations are attached as Appendix 3.

5. Management Structure, Potential Investors and Proposals for Further Development

• A management structure will evolve as the industry grows. To start with it seems as though the major function should be to promote Casuarina obesa as a commercial timber option for land that is otherwise of limited value and for its landcare benefits. At the same time a genetic improvement program to select provenances with superior wood producing capacity should be commenced.

• Bandicoot Nursery could become the pivotal nursery for the provision of seedlings and the promotion of the species. The product idea screening process carried out in this concept assessment suggests that the sale of seedlings for both commercial timber production and landcare purposes are likely to be the products with the greatest prospects of success. Given the long lead times for timber products, a focus on seedlings appears appropriate. A package could combine the production of seedlings and the development and promotion of a silvicultural package to develop the species as an agro-forestry venture.

• Dr Liz Barbour, Manager of Seed Technologies at the Forest Products Commission has expressed her interest in assisting with trial work for Casuarina obesa and a suitable Heads of Agreement between Forest Products Commission and Bandicoot Nursery to facilitate this in a mutually beneficial way should be developed.

• Dr Phil Cocks of the Co-operative Research Centre for Plant-Based Management of Dryland Salinity at the University of Western Australia has expressed cautious interest in the species. He has recommended the development of a Preliminary Proposal for a research project (for early 2003). The CRC is concentrating on species that may be applicable at a large landscape scale but there will be some funds for species that provide for niche

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 14 markets and utilise water. There is a possibility of applying for funds to develop the Preliminary Proposal and a sum of $8,000 was mooted. A critical requirement is a suitable partner who is a member of the CRC such as CALM, Forest Products Commission or CSIRO. • Once a number of plantations have been established then the next step may be to form an Incorporated Association of Swamp Sheoak Growers to provide an entity to apply for NHT funding etc, and to carry on projects of mutual benefit. This Association may subsequently evolve into a New Generation Co- Operative, or a Propriety Limited Company. However, in the initial instance it may be better to avoid the costs of these corporate structures and to keep the structural grouping simple and appropriate to its functions.

6. Proposal for Development of a Business Plan

• A Heads of Agreement between the Hollingworths and the Whites needs to be formalized to underwrite any proposed joint venture. • Bandicoot Nursery should investigate Small Business Improvement Program (SBIP) or Rural Industry Research and Development Corporation (RIRDC) funding to complete a business plan / marketing plan on a dollar for dollar basis to help successfully launch a Casuarina obesa seedling production venture as part of its overall operation. One of the functions of the plan would be to support an application to the National Heritage Trust (NHT) for research and development funding to get the project off the ground. • Great Southern Development Commission (GSDC) funding may be available to help establish a Swamp Sheoak Association, and / or assist with the cost of putting funding applications together. The New Industries Development Program (NIDP). should then be investigated for capital funding for the project.

7. Conclusion

There appear to be definite benefits from pursuing the concept of developing plantation plantings of Casuarina obesa for the commercial production of high grade appearance timber. Casuarina obesa also has a significant sustainable competitive advantage as a tree that can help ameliorate salinity problems. There also appears to be considerable potential to improve the wood production capacity of Casuarina obesa via genetic selection. If the species has the capacity to produce a commercial return as a high grade appearance timber as well as its landcare benefits it will be very attractive to farmers attempting to improve their land that is slightly saline. The twenty-five year time scale to produce sawlogs is, however, going to be a major hurdle to overcome.

The concept of producing and marketing Casuarina obesa seedlings as a business venture in its own right, with the long term prospects of high grade appearance timber at the end of the project, deserves further development.

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 15

References

Agriculture Western Australia (1999) Speciality Timbers for the Western Australian Wheatbelt, FarmNote 80/99

Barbour, E (2002) Personal Communication. Manager Seed Technologies, Forest Products Commission

Bartle, J (2002) Personal Communication. Manager, Farm Forestry Unit

Bulman, P (1998) Farm Trees for the Mount Lofty Ranges. A Regional Agroforestry Handbook. Primary Industries South Australia

Cremer In White 2001

Donnelly In White 2001

Doran J and Hall N (1983) Notes on 15 Australian Casuarina species. In Midgley SJ, Turnbull JW and Johnston RD (Eds). Casuarina Ecology Management and Utilisation. Proceedings of an international workshop, Canberra, Australia 17-21 August 1981.

Hollingworth, W & White, P (2002) Personal Communication

McFall , David (2002) Personal Communication

Midgley, SJ & Turnbull In White 2001

Moore, R (2000) Eucalypts for Sawlogs – a Promising New Farm Forestry Option

O’Sulllivan, W (2002) Personal Communication

Power, M & Robinson, BT (2002) Personal Communication

Race, Digby In White 2001

Siemon, GR and Pitcher, JA (1994) Timber Properties and Market Potential of Selected Wheatbelt Species – Rock Sheoak and Swamp Sheoak. Unpublished CALM Report

White, P (2001) A preliminary investigation of Swamp Sheoak Casuarina obesa Miq as an Agroforestry option for the Western Australian Wheatbelt. Unpublished paper.

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 16 APPENDIX 1

White (2001) Research requirements, adapted from BOSTID (1984), Barbour (1997), and Midgley et al. (1981). Research requirements Priorities • Agricultural aspects Design and planning of shelter belts Competition with agricultural crops Competition with other agricultural pursuits Palatability / toxicity Length of crop rotation Duration of crop Labour requirements • Economic evaluation: How the economics of Casuarina obesa plantings compare with the available agricultural options • Genetic improvement: Search for superior individuals as a basis for a tree breeding program. Included in this process is; Taxonomic validation of species, subspecies and provenance Parent tree selection e.g. branch size, internode length • Produce / marketing Value of produce Size of market Transport radius Opportunity for value adding • Physiology and Response to; high salinity Environmental waterlogging Tolerances extremes in pH Water table drawdown Nitrogen fixing capability, including; level of fixation effects of soil fertility on fixation inoculation for root nodulation and mycorrhizal infection • Silvicultural options Vegetative propagation from mature superior trees Planting density Pruning and thinning regimes Product target Coppice cropping Rotation length Accurate growth and measurement • Utilization: Use of for; biomass production pulp and particle board conversion to firewood and charcoal veneer production Drying and seasoning schedules Fodder values

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 17 Appendix 2 (White, 2001) Growth estimations based on the assumption of;

1. height growth of 0.6m / ann 2. diameter increase of 1.75cm / ann.

Age Height (m) Diameter (cm) 1 0.6 1.75 2 1.2 3.5 3 1.8 5.25 4 2.6 7.0 5 3.0 8.75 6 3.6 10.5 7 4.2 12.25 8 4.8 14.0 9 5.4 15.75 10 6.0 17.5 11 6.6 19.25 12 7.2 21.0 13 7.8 22.75 14 8.4 24.5 15 9.0 26.25 16 9.6 28.0 17 10.2 29.75 18 10.8 31.5 19 11.4 33.25 20 12.0 35.0 21 12.6 36.75 22 13.2 38.5 23 13.8 40.25 24 14.4 42.0 25 15.0 43.75

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 18 Appendix 3 (White, 2001) Casuarina obesa: Net Present Value Calculations Prior land use $/ha/yr $25.00 grazing @ 1 DSE/ac @ $10/DSE margin

Est' ment Year $/ha Stocking 1,111 stems/ha costs Total $0.00 $695.00 1st Thinning Year 9 to 500/ha Fertiliser 0 $10.00 2nd Thinning Year 12 to 250/ha Ann. maint. 0 - 30 $20.00 3rd Thinning Year 18 to 150/ha Clearfall Year 25 MAI 6.13 m3/ha/yr Tree returns Harvest volume (cu m/ha)

Year 9 Year 12 Year 18 Year 25 $/cu m No / m3 $ea. Fenceposts 18.69 27.69 0.00 0.00 $70.00 35 $2.00 Strainers 0.00 0.00 $0.00 Sawlogs 46.73 0.00 $50.00 discount rate Sawlogs 60.10 $70.00 6.00% Waste 0.00

Financial Costs Sales Grazing Net Present NPV analysis $/ha $/ha $/ha $/ha Value $/ha 0 1997 $695.00 $25.00 -$670.00 -$670.00 -$670.00 1 1998 $120.00 $0.00 -$120.00 -$113.21 -$783.21 form prune 2 1999 $20.00 $0.00 -$20.00 -$17.80 -$801.01 3 2000 $20.00 $0.00 -$20.00 -$16.79 -$817.80 4 2001 $20.00 $1.00 -$19.00 -$15.05 -$832.85 5 2002 $120.00 $2.00 -$118.00 -$88.18 -$921.03 prune 6 2003 $20.00 $3.00 -$17.00 -$11.98 -$933.01 7 2004 $20.00 $4.00 -$16.00 -$10.64 -$943.65 8 2005 $20.00 $5.00 -$15.00 -$9.41 -$953.06 9 2006 $150.00 $1,308.58 $6.00 $1,164.58 $689.31 -$263.75 thin/prune 10 2007 $20.00 $7.00 -$13.00 -$7.26 -$271.01 11 2008 $20.00 $8.00 -$12.00 -$6.32 -$277.33 12 2009 $150.00 $1,938.64 $9.00 $1,797.64 $893.37 $616.04 thin/prune 13 2010 $20.00 $10.00 -$10.00 -$4.69 $611.35 14 2011 $20.00 $10.00 -$10.00 -$4.42 $606.93 15 2012 $20.00 $10.00 -$10.00 -$4.17 $602.76 16 2013 $20.00 $10.00 -$10.00 -$3.94 $598.82 17 2014 $20.00 $10.00 -$10.00 -$3.71 $595.11 18 2015 $200.00 $2,336.75 $10.00 $2,146.75 $752.10 $1,347.21 thin/prune 19 2016 $20.00 $10.00 -$10.00 -$3.31 $1,343.90 20 2017 $20.00 $10.00 -$10.00 -$3.12 $1,340.78 21 2018 $20.00 $10.00 -$10.00 -$2.94 $1,337.84 22 2019 $20.00 $10.00 -$10.00 -$2.78 $1,335.07 23 2020 $20.00 $10.00 -$10.00 -$2.62 $1,332.45 24 2021 $20.00 $10.00 -$10.00 -$2.47 $1,329.98 25 2022 $500.00 $4,207.11 $10.00 $3,717.11 $866.08 $2,196.06 Clear fell Total $1,815.00 $9,791.07 $200.00 $7,676.07 $2,196.06 Annuity equivalent ($8) $162 /ha/yr

adapted from a model supplied by P. Eckersley, AgWA Bunbury

Swamp Sheoak Feasibility Study - Green Skills Environs Consulting Pty Ltd 19