Growing timber for revenue diversification on Welsh farmland
More than ever before, farmers need to build resilience into their business planning, which amongst other things could include woodland creation as part of a revenue diversification strategy
Author: Woodknowledge Wales
This case study was authored as part of the Home-grown Homes project and was funded by Welsh Government
Summary
The sustainability of farming businesses in Wales has never been more uncertain. The increasing costs of production coupled with doubts over the nature of future subsidy and the way farmers are expected to respond to the climate crisis is having a negative impact on their wellbeing.
More than ever before, farmers need to build resilience into their business planning, which amongst other things could include woodland creation as part of a revenue diversification strategy. Tree planting has certainly proved to be an effective strategy for one mid Wales farming family.
With the help of a specialist forestry agent, they were able to access grants for planting and maintenance of a new woodland – carefully designed to ensure the choice of tree species suited the site, the soil, the climate and their objectives whilst fitting in the existing landscape. Their investment, on some of the least productive land on the farm has shown real benefits and encouraged them to create more woodland.
Key Players
“…people are scared of change, but we’ve got to do something so we don’t go down the pan.” Martin James and his partner Charly, Welsh sheep farmers, Talybont
“The land was valued at approximately £1,500 per acre at the time and in today’s market it is closer to £7,500 with a likely increase over the coming years.” Robert South, Managing Director, Bronwin & Abbey
“Forestry agents play a crucial role in taking the pressure off those wishing to pursue the woodland creation schemes.” Anna Dauksta, Forestry & Timber
Background
Tyn y Rhos farm
Son of a traditional Welsh sheep farmer, Martin James, grew up on an upland family farm Tyn y Rhos, outside Ponterwyd in Ceredigion. Martin and his partner Charly now own and live on a family farm of their own near Talybont, 15 miles from Ponterwyd. Their farm consists of 106-hectares which includes 54 hectares of the original family upland farm (365 metres above sea level) at Tyn y Rhos and Banc y Bont, classed as a Less Favoured Area (LFA)[1] and the rest of the farmland is near Talybont which is more lowland.
Diversification
Martin has kept up the tradition of sheep farming however, in recent years Charly and Martin have begun diversifying to help secure the future of their family farm. In 2019, with the help of local forestry management firm Bronwin & Abbey, they converted three of the LFA fields amounting to 9.6 hectares at Tyn y Rhos to forestry. In 2023, following the success of this woodland creation at Tyn y Rhos, they planted 10.5 hectares more woodland at Banc y Bont next to Tyn y Rhos. Martin and Chary have created woodland on over 20 hectares of the 54 hectares upland farmland they have. They have also diversified their farming practice and income in other ways to incorporate both a livery yard and a glamping site.
Narrative
Working smarter, not harder: Selecting enhanced mixed woodland for a more rapid timber income
By 2019, increased rainfall resulting from the warming climate, meant wetter ground and poorer grazing for the flock at Tyn y Rhos. The changing climate is leading to more heavy rainfall events and making marginal land more difficult to use for agricultural production. Getting fodder to the sheep in the winter was becoming harder and more treacherous year by year. Martin wanted to “work smarter, not harder” and avoid burnout, but the increased workload and stress he was feeling when tending to his flock on this poorer land at Tyn y Rhos did not align with his aim. They decided to bring in Bronwin & Abbey to produce a woodland creation plan on some of the more difficult fields at Tyn y Rhos, using the Welsh Government’s Glastir Woodland Creation (GWC) grant scheme.
Bronwin and Abbey produced a woodland creation plan that reflected the site and Martin and Charly’s objectives. They wanted to:
- plant trees which would produce an income as soon as possible
- plant trees only on the ground which was most difficult to farm
- have a simple transition to trees with no interference to the farm business
- have less work compared to keeping sheep on that ground
- worry less about soil and water issues in winter months.
As a result, they chose the Enhanced Mixed Woodland option – although the overall grant payments would have been higher for a Native Woodland Carbon option. They made this decision because this type of woodland will bring in an income from the timber it produces more quickly than the alternatives. The decision aligns with the farm’s objectives, and by integrating trees into farm business planning, the future value of the timber can be factored in as income. The financial support from Welsh Government for planting and maintenance means the option more than pays for itself. Martin feels he’s able to work smarter not harder. The grant support enabled contractors to be employed to plant the woodland and maintain it. Since they first planted trees at Tyn y Rhos in 2019, the payments available have been increased for woodland creation. Such that the Welsh Government grant for the Enhanced Mixed Woodland option has increased from £3,600 to £5,146 per hectare and for the Native Woodland Carbon option, the rate has increased from £4,500 to £6,170 per hectare[2]. Martin and Charly are also planning to sell the carbon, that the woodland captures from the atmosphere, using the Woodland Carbon Code[3] mechanism.
Designed to meet standards for timber, wildlife, and the climate
The woodland was designed and established to fit in with the landscape and meet standards set out in the United Kingdom Forestry Standard (UKFS) which is used to set the basic standard for the Welsh Government woodland creation schemes. The design reinforces existing trees and buffers water courses by planting broadleaved trees, and the woodland is large enough to provide a range of benefits along with the timber. These include carbon sequestration, increased biodiversity, shelter for adjacent fields and potential to reduce excess water runoff. The 9.6 hectares of new woodland at Tyn y Rhos were planted mainly using conifers with mixed broadleaves and shrubs incorporated to provide areas for biodiversity and habitat. Broadleaved species were also planted to merge with the existing ancient oak woodlands that run alongside the river Rheidol. See Figure 1 below.
Figure 1 – woodland design map of Tyn y Rhos
By employing a forestry agent, Martin and Charly have used the agent’s knowledge and experience to design a woodland that reflects their objectives and what is required to access the grant funding. Robert South of Bronwin & Abbey carried out all the necessary processes and procedures for the woodland creation allowing Martin and Charly to carry on with running the rest of the farm business. Farmers can rely on forestry agents to fulfil all the requirements for successful woodland creation including support for planning, the tree establishment and the maintenance of the trees. The grant provides annual premium payments in addition to the maintenance payments for the first twelve years after the woodland is planted.
Robert explained that in 2019, when the first planting took place, the grant rate was £3,600. This has since increased substantially to £5,146, covering a significant rise in costs. However, Martin and Charly have established and maintained this woodland without any additional expense or effort for the farm business, while also receiving annual ‘premium’ payments for 12 years.
Generally, the first opportunity for income from timber comes with the thinning of the conifers – usually at age 15. However, improved breeding and management techniques linked to climate change are reducing this period and it could become as early as age 12. The conifers have grown well at Tyn y Rhos and are showing promise of becoming a valuable timber stock for the future (see figure 2).
Creating the woodland has resulted in an increase in the value of the land. Robert has estimated the value has increased five-fold and is likely to increase further over the coming years.
Figure 2 – the new woodland includes young conifers, shown here, which are now well established
Impact
As well as the financial support, greater productivity and enhanced land value Martin and Charly appreciate the positive impact the woodland has had on the landscape with the changing colours, and the patterns and shapes created by the planted trees (see Figure 3). Martin commented “I love coming up here now and going for a walk through the trees and not having the stress of worrying if something has gone wrong with the sheep – I enjoy it” and “people are scared of change, but we’ve got to do something, so we don’t go down the pan”.
The changes in the landscape and the increased wildlife are additional benefits. These outcomes in part have acted as incentives for Martin and Charly to investigate woodland creation on a larger and more productive scale. However, the key drivers behind the decision to choose trees over the practice of traditional sheep farming on this land were future financial security for Martin and Charly, in order to keep the family farm going.
Figure 3 – the new woodland created on LFA (Less Favoured Area) land at Tyn y Rhos
Farmers like Martin and Charly are leading the way by demonstrating that well-designed tree planting schemes integrated into the farming business are an important investment opportunity for the future of farming, especially when supported by Woodland Creation grant schemes. However, it’s a challenge to improve understanding of the economic, environmental, and societal benefits trees can bring people and farming communities across Wales. Woodknowledge Wales’s vision is that of a transformation into a high-value forest nation in Wales delivering public good through afforestation and the decarbonisation of the built environment using home-grown construction timber. There is an opportunity to grow trees that the construction industry needs and to create a circular economy through the cascading use of wood products.
Tyn y Rhos is growing trees which will produce a crop of productive timber which can be used to create valuable timber products. This will earn income for the farm and will be part of the family’s future. It’s a long-term investment for which Martin and Charly have only needed to provide land – and in this case their poorest land that would otherwise have offered little benefit to the farm business.
[1] The EU’s LFA designation refers to areas where geographic, soil or climatic conditions constrain productivity and make farming more difficult. In Wales this reflects the mountainous terrain, steep slopes on upland farms and high rainfall (Research Senedd Wales, 2022).
[2] See https://www.gov.wales/woodland-creation-grant-overview
[3] See https://www.woodlandcarboncode.org.uk
