Last month I discussed the steps for adding “pasture into the woods” by increasing sunlight levels through forest thinning, and then managing the area to establish and promote the growth of quality forages beneath a canopy of productive and functional trees. This article will focus on the other direction of creating silvopasture: adding “woods into pastures.” I personally consider this to be the more challenging of the two situations, and those of you experienced with the successful establishment of trees in a sod environment full of hungry herbivores are well aware that there’s more to consider than simply putting trees in the ground.
So before we get into the process of enhancing open pastureland through the incorporation of trees, let’s talk about the reasons for considering such a project. Use the following criteria to help evaluate whether creating silvopastures through tree planting in existing open pastures is right for your operation:
Will it be profitable?
More accurately, will the “benefits” exceed the “costs”. As with most farm investments, the net value should be considered more broadly than solely the estimated revenues and expenses of planting a tree crop. Trees in agroforestry systems are meant to be “working” trees whose value extends well beyond that of their timber. Some benefits of adding trees include:
• Diet diversification
• Shelter and shade (as in my article on Living Barns)
• Improved soil health and nutrient cycling
• Wildlife habitat enhancement
• Watershed and soil protection
• Rainfall interception and reduced storm runoff
• Food crops like nuts, fruits and syrups
• Honey bee fodder; etc.
The aesthetics of incorporating trees into the pastoral landscape is a less-tangible benefit, but one that is nonetheless significant. These types of “other benefits” are harder to quantify than a board-foot of lumber or cord of firewood, but a reasonable value can be assigned to each and used to evaluate the soundness of the investment.
For long-term investments like tree planting, interest costs become significant and therefore all associated revenues and expenses should be adjusted to the present. This is known as “Net Present Value” (NPV) and allows for comparing present cash flows to future ones. As a simple example, $1000 is invested today to establish trees that will have an estimated worth of $5,000 in 20 years. Using a modest interest rate of 5%, the future revenue of $5,000 discounted to Year Zero is worth $2,730 dollars (not $5,000). So the NPV of the project is $1,730 ($2,730-$1,000). Forestry investments, however, are usually more complex and involve numerous cash flows both in (revenues) and out (expenses) throughout the life of the project. But for the purpose of determining the NPV of adding trees to your pasture, keep things simple by only considering the cash flows that would be different from the status quo. Expenses like property taxes and land costs (rent, mortgage or otherwise) are likely to be about the same whether the land is used for silvopasture or pasture and therefore do not need to be contemplated for the purpose of comparison. If the NPV is negative, then do the other benefits (those that weren’t included in the NPV calculation) help to shift the value into the positive range? If not, then the investment will likely be a loser for the farm business.
Can I afford it?
The cost of buying hundreds or thousands of trees to create silvopastures from scratch is only the starting point of the investment. Other typical necessary investments for young trees to survive and grow into a valuable timber resource include: site preparation; planting costs; on-going maintenance; and protection from livestock, wildlife and pests. These costs can vary considerably from one situation to another, but usually are multiples times that of the seedling costs. When analyzing the investment, be sure to reasonably account for all expenses – not just the apparent or initial ones.
Do I have the time to do it right?
Cash expenses are only part of the investment. Equally important, and often more limiting is time. Over the past 28 years as a forester, the number one reason that I’ve seen planting projects fail is that the landowner bit off more than could be chewed and wasn’t able to keep up with the on-going maintenance. Cutting corners or failure to obey the principals of successful tree planting will yield disappointing results.