Specific environmental benefits of forests include protection against soil loss, land rehabilitation, protection of forest ecosystems (and species protection), and of increasing concern, carbon fixation. In forest protection, New Zealand already leads the world with almost 23% of its total land area as protected forest under Department of Conservation jurisdiction. New Zealand has the highest proportion of land under strictly protected forest cover, of any of the world's temperate zone nations.

Afforestation is recognised as presenting the best land use opportunity for significant enhancement of the global carbon capture and storage. New Zealand is one of the few countries in the world which could easily achieve a positive carbon balance by capturing all its carbon emissions through an increase in afforestation. It is estimated that only a 25% increase in our plantation estate is required to achieve a balanced carbon budget throughout the next 30 years. A 300% increase in New Zealand's plantation forest estate is achievable.

Future markets for forest produce
New Zealand already produces far more timber from its plantations than it needs for domestic consumption. Therefore all timber produced from any new forest areas will have to be sold on to export markets. New Zealand's 1990 wood product exports had a total volume of approximately 6.3 million cubic metres and, based on existing forest areas the volumes available for export could increase four times by 2020 AD. further extension of New Zealand's production forest area is occurring, so further major increases in wood production will occur beyond 2020 AD.

World consumption of industrial wood totals about 16 billion m³ per year. While demand rapidly increases, major components of the world's timber resources are in decline.

Approximately 90% of the world's industrial wood comes from natural forests. Harvestable tropical forest is being reduced by about 17 million ha per year, a resource loss rate of approximately 1.3% per year, which is sustained will lead to effective exhaustion of harvestable tropical forest by around 2050.

Market demand for processed timber products is essentially a function of per capita wealth, and population. For example per capita demand is highest in Japan, Korea, USA and EEC countries and other advanced economies.

The world's region of greatest economic growth and greatest population concentration is the Pacific Rim countries, the "asian tiger" economies. The economies are making increasing demands on Asian/Pacific tropical forest resources. Resource depletion and escalating demand are on a predictable collision course. In addition to problems with supplies of tropical hardwoods, a softwood (conifer) timber deficit of 60 million m³/year is predicted for Asia/Pacific by 2000 AD.

Regional supply problems already exist in Asia. Malaysia is the largest exporter of tropical hardwood logs. Its export capability will reduce 50% between 1990 and 2000. Thailand has instituted a complete ban on logging over many regions. The Philippines and Indonesia have bans on export of unprocessed logs.

Unlike Asia where hardwoods still dominate, the main North American and European timber markets are based mainly on conifers. Huge annual timber deficits of between 50 and 140 million m³ are predicted in Europe by 2010 as a result of increasing industrial demand.

North American old crop sources of Douglas fir and other softwoods are being overcut. Environmentalists believe that if British Columbia continues its current harvesting level then coastal old growth forests will be exhausted by about 2005. The Pacific Northwest of the United States could have 4.7 million hectares of forest removed from logging if a proposal by the US Fish and Wildlife Service to protect the habitat of the endangered Spotted Owl is introduced. This would reduce future harvests to a third of recent levels. The quality of Pacific NW forest produce is steadily declining as old growth timber becomes scarcer and smaller regrowth trees increasingly dominate log supplies.

Conservation constraints and depletion of old natural forests in tropical and temperate regions will increasingly reduce the global availability of industrial wood. New Zealand in advantageously placed to produce wood on a renewable and environmentally sound basis from plantations to supply the growing Pacific Rim markets. It may be concluded that market prospects for New Zealand timber produce are exceptionally good. Our nearest export market, the asian region, has the fastest growing demand for wood products in the world.

The eastern South Island inland hill and high country represents a huge land resource in total about 5.0 million ha but only a small proportion, perhaps 20% could be regarded as physically suited to commercial forestry as a land use.

The high country land resource which is optimal for tree growing, combining easy access, high rainfall and good soils, is much smaller again, perhaps less than 3% of the total.

The inland hill and high country represents some unique opportunities for New Zealand forestry, including opportunities for growing alternative softwood species to radiata pine, including species which are well known and accepted by traditional timber markets. Diversification in species, wood product types and marketing opportunities have obvious long-term risk-reduction strategic value to the New Zealand economy.

Douglas fir in particular is a major opportunity. It currently accounts for the largest volume of any softwood species traded on international markets, and it has an established market reputation throughout the Pacific Rim. Unpruned Douglas fir logs command prices comparable to pruned radiata. The best high country sites can produce much higher yields than average New Zealand radiata sites and provide an opportunity for an extremely cash-rich landuse with sustainable income on today's prices of $1000/ha/yr.