
          Forestry and Equity
          By Hatley, TomTom Hatley
          Vol. 5, No. 4, 1983, pp. 19-23
          
          If you travel along a state highway during the Southern winter,
your eyes follow unavoidably the constants of the land: field openings
of red, brown, and dun-colored soil breaking against the highway, and
never far off, green seams of forest against the horizon. The
intervals of green in the Southern landscape, more, often than not,
signal the presence of pine and other fast-growing softwood trees. The
land is also green in another sense, however, for the sixty million
acres of softwood forest in the South today are financially
valuable. The harvest of trees in an agricultural product second only
to the value of tobacco cropping in North Carolina, and twenty percent
of that state's land area is covered with pine trees. The South
supplies nearly half of the nation's softwood timber today and can
grow even more wood in the future. Across the South, softwood trees
such as pine, sweetgum, and sycamore provide a main part of the
employment base for 1.3 million forest industry workers, in
occupations ranging from falling trees to making paper.
          Corporations and, increasingly, banks, insurance companies and
pension funds are investing in timberland in the South with the
expectation of dependable investment returns from four to six percent
over inflation. Boosters of this financial promise point to
Georgia-Pacific Company's decision to move its corporate headquarters
from Portland, Oregon, to Atlanta and the forty-million-

dollar
pulpmill being built by a Finnish-American joint venture in New
Augusta, Mississippi, as bellwethers of a new age. Much more than a
simple discovery of the South's potential to become the new
"woodbasket of the nation," corporate decisions to invest in the South
often have to do primarily with changes and dislocation in the global
market for wood products. For instance, the Baltic region of
Scandinavia cannot continue to meet the West European demand for paper
pulp, which it has supplied since late mediaeval times, off of its own
cold and wet land alone. Whatever the underlying reasons for the shift
to the South, the increasing worldwide wood demand, whether for
cooking fuel, paper pulp, lumber, or methanol, means that the changes
taking place in the Southeast will be long-lasting.
          On the Southern forest today, small-sized land ownerships remain
the rule. This particularly holds true for the valuable mature or
near-mature pine stands across the South. Forty million acres of
pineland are in private hands. In North Carolina, 250,000 owners held
eighty percent of the state's private land. Each of these individuals
owns a tract which is on the average less than one hundred acres.
          Black people in the South hold a substantial share of this wealth
in land and trees. Yet an unfortunate combination of economic and
social forces is pushing these blacks toward landlessness. Dependable
statistics concerning black land ownership--how many acres, how many
owners--are very difficult to come by. The Census Bureau itself
estimates that the number of black farmers was undercounted by
fifty-three percent in the 1974 Census. Similar problems appear in the
counts of many agencies concerned with rural trends. In a sense, this
statistical fuzziness reflects the indeterminate (or even
unrecognized) standing of minority landowners and their problems for
many government programs.
          Some alarming trends show themselves in spite of the imprecision of
the statistics on certain points. Over the past decade the number of
black farms diminished at two and one-half times the rate of white
agricultural holdings. Today roughly 85,000 farms are being operated
by blacks; there were 130,000 in 1969. Of course, not all black
landowners are farmers. Department of Agriculture figures suggest that
there is a large group of blacks (perhaps fifty percent of the size of
the number of active farmers) who own rural acreages but do not
actively farm them. The rate of decline in the holdings of black
farmers proper probably crosses over to this group as well, as it does
for the relatively small holdings of native Americans.
          The trend toward land loss by minorities, particularly in the
South, where their holdings are concentrated, is not new, but,
instead, of slowing, it is increasing. The 1982 report of the US Civil
Rights Commission, "The Decline of Black Farming in America", warns
early on that "At [the present] rate of loss, there will be virtually
no blacks operating farms in this country by the end of the next
decade."
          The situation which the Commission addressed in its report is often
labelled a crisis in farmland ownership. But the problem extends
beyond the image of cultivated fields and pastures that the word
farmland calls to mind. Valuable and appreciating minority-owned
forests, whether on a section of a family farm's acreage or on
non-farm holdings, are also vanishing. Of farmland owned by blacks in
the South, certainly more than half is forested; non-farm rural land
is even more wooded. In the changing economic landscape of the South,
the small landowner, particularly the black landowner, is losing
substantial present and future forest assets to corporations and
individual investors seeking tax shelters.
          E.F. Hutton Group, Inc. offices in medium-sized cities across the
nation are at this moment offering shares in a second limited
partnership of twenty million dollars to purchase woodland in Georgia,
Alabama, and Florida. Promising a turnover time of as little as seven
years, a return of eight percent during the life of the partnership,
and significant tax shelter aspects, Hutton fully subscribed the first
offering in less than four months. This arrangement (and others like
it offered by Merrill Lynch and First National Bank of Atlanta)
capitalizes on the very large standing stock of mature pine timber in
the South today. Though the promotional literature for these plans
stresses the long-term potential for a bull market in the Southern
forest, each plan is basically designed to harvest both trees and tax
credits. As Hutton's promotional brochure notes: "Southeastern
timberland is avail-

able." Sadly, the long-term loss of minority-owned
land in the South has contributed to the tragic 'availability' of
woodland formerly held by small owners.
          The billion-dollar-plus land and timber asset owned by minority
landowners in the South remains a significant potential equity
resource of Southern blacks. Yet putting an exact price tag on this
land is difficult. Land prices are highly variable throughout the
South. One hundred acres within the asphalt reach of a city like
Charlotte or Jackson may have a high development value; a similar
piece of land in a rural section may bring only a fraction as
much. The share of land value contributed by the forest is also
difficult to pin down. Perhaps as much as one-half of the total value
of black-owned forestland (again, representing roughly fifty to
seventy percent of the total black land-holding) can be attributed to
the value of the trees growing on the land. Because of their high
value in today's market, pine stands disproportionately contribute to
this total value.
          Markets for forest products are highly changeable. Yet the
financial advantage of selling pine timber relative to other species
seems very likely to continue for the next ten to thirty years. During
this same period, local or regional markets (such as in North
Carolina's furniture belt) may also be strong for hardwood species
such as oak, walnut and maple. But the greatest forest asset of small
owners today, and the best promise for financial return, remains pine
softwood stands--many of them on minority lands--growing across the
region.
          Pine stands demand special management techniques, and both the need
for such techniques as well as the potential scale of forest income
are peculiarly rooted in the historical origins of the pine
forest. Exploring the social and ecological past of the Southern pine
forest can bring the current situation of forestland in the South--its
opportunities and problems--into sharper focus.
          Of the forty million acres of pineland in private ownership in the
South, most are the unexpected inheritance of agricultural change
during the years from 1930-50. Stephen Boyce of the US Forest Service
has told this story best in a series of fine technical articles on
wood supplies in the South. The generation of Southern farmers of this
period realized that with the help of new tractor and chemical
fertilizers, they could make their production goals on much smaller
acreages. New farm policies seeking to restrict production encouraged
them in this adjustment, and this, along with direct dislocation,
contributed to the acreage of land left unplowed and fallow. When the
land was left uncultivated, pine seeds, windblown from trees along
field edges, took root and grew into a new extensive pine
forest. Today these twenty-five to fifty-year-old pines constitute
much of the regional forest asset that investors are now
discovering. True to their beginnings, the Southern pinelands remain
largely in the hands of farmers and small landowners black and
white.
          An aerial photograph showing green. old field patches of pine in
the corner of a Piedmont or Coastal Plain county can be read like a
still-shot of land change. Five or so major species of pine are the
dominant old field species in the South because they germinate and
come to maturity under full sunlight better than other trees. They are
not tolerant of the shade cast by a neighbor. Common ecological
threads tie together all of the pine stand patches. The trees are
often growing on less productive soils that follow the farmers' logic:
steeper, drier slopes and eroded fields were the first abandoned. The
pines can slowly heal some of the damage done to this ground.
          Once it takes hold, the pine forest has a lifespan stretching to
150 years. The early life of the pine stand sees seedlings gradually
crowd out the yellow of broom-sedge and asters to form a thick
canopy. By middle age, the number of trees in the stand drops off
sharply, and those that are left grow taller and more
valuable. Eventually the growth rate of these trees tapers off, and
longer-lived trees such as oaks or elm and hickory begin to grow
faster than the pines and finally outlive them. Forest management can
be effective in improving the value of pine stands during the middle
years--roughly from thirty to sixty--of their life.
          Most of the millions of acres of pine forest growing on small,
privately-owned tracts across the South are now entering this critical
period. Though these thousands of individual stands are not all
equally promising, the larger acreages have a particularly strong
potential to make forest management pay off through building long-term
income. As the trees on private land age, this possibility will begin
to diminish. Around the end of the century, about the time that the
post war generation of Southerners reaches retirement age, a decline
will be in full swing.
          Today so many of these old-field pine stands, now entering maturity
in the financial sense, are being cut that forest economists are
predicting a dip in the Southeastern softwood supplies. At the same
time, small landowners are not renewing these stands through tree
planting or other measures. What is showing up in the 

graphs as a
small tilt today will become a serious shift twenty or thirty years
down the road, when the current southern softwood surplus has been
opportunistically consumed. Even though corporations have begun
extensive planting programs to try to insure a portion of their future
wood supplies, they cannot make up the deficit on their lands alone. A
serious and unfortunate consequence is that corporations are
responding to this dilemma by turning toward establishing intensive
forest plantations on Southern wetlands such as peatlands and alluvial
river bottoms. Serious environmental damage results from converting
natural forest ecosystems to simplified, single species
landscapes. The consequences of wetland conversion range from losing
genetic diversity as native plants and animals are pushed out by
uniform monocultural plantings, to short-circuiting the complex
pathways by which wetlands regulate water flows and buffer
pollution. In light of this, it makes environmental sense to continue
and even intensify the harvest of trees off oldfield stands with a
history of disturbance like those commonly on small land-holdings. The
alternative is, all too plainly, to allow corporations to continue to
gamble with large scale modification of natural systems valuable to
all Southerners.
          Intensifying the management and harvest of trees off private lands
makes good economic sense for the small landowner as well. However,
just as there are makes opportunities to make this choice worthwhile,
minority landowners are being pushed out of a market that they, along
with other small holders, have dominated for years.
          Part of the problem has to do with the way in which small
landowners view the financial potential of their forests. Most are
accustomed to treating forest land as a nest egg or savings account
with a small investment return. Yet anyone who has counted the annual
growth rings on a stick of firewood has witnessed the rate of which
trees add to their "principal". And the market price for wood has
increased steadily over this century Given this, long-term forest
income can more closely resemble an annuity with continued growth
beyond inflation. However, active forest management is nearly always
necessary to make this promise a reality.
          Most of the pine forests owned by private individuals in the South
grow and are cut without the benefit of sound forestry practices. When
these lands are not properly managed, or are sold or foreclosed,
another corridor to a stronger rural economy is closed off for
blacks. On the mature pine stands, the manner in which trees are
harvested has a great deal to do with the future income that can
result from the forest. For example, clear-cutting/he family property
all at once will often result in a second forest of far less value
than that initially on the land, particularly if the original forest
was an old field pine stand. Over the past decade, only twenty percent
of the pine stands cut in the South have returned to pine through
natural reseeding from nearby trees. Another twenty percent, mainly on
larger holdings, was replanted. For financially hardpressed
landowners, the investment in purchasing and setting out seedlings
makes planting a difficult step to take. As a result, cashing in on a
nest egg of old-field pines may well be impossible the second time
around.
          Foresters have developed middle-of-the-road cutting techniques that
may offer a way out of the cycle of clear-cutting and neglect that is
today's rule. Two methods of cutting and regenerating the
forest--"group selection" and "shelterwood"--are promising. These
techniques work with the existing mature forest to renew the stand as
the forest is harvested over a period of years. Under shelterwood
management, thinnings are carried out early in the life of the forest;
then, when the forest stand reaches middle age, two or more
substantial cuttings are made. As the canopy is opened, light falling
on the forest floor will allow a second generation of pines to grow
under the old stand of trees. When the original stand is removed, a
new vigorous pine generation will be ready to take its place. The
group selection technique creates a forest of patches of
different-aged trees by making many small openings in the forest
canopy from year to year.
          Shelterwood and group selection management styles may hold
financial advantages for the small owner as well. Since frequent
cuttings are made, income will be received on a regular schedule
rather than all at once. When a stand is finally harvested, another
stand will be approaching a point at which it too will be financially
productive. These techniques are not useful on all lands--particularly
less fertile ones. However, they are currently being used on only a
small fraction of the Southern forest on which they could be
effective.
          The difficulties of bringing minority-held forest land under
productive forestry practices also lie outside of, as well as in, the
woods. The average size of forest tracts held by black owners is
small, probably less than fifty acres. On land-holdings of this size,
it is difficult to obtain management advice while the stand of trees
is growing, and to 

schedule sound patterns of harvest for profitable
sales. However, as the trees mature, there are many possible
strategies for overcoming these handicaps. Organizing marketing and
management cooperatives among small landowners may offer one way out
of this problem. The chief advantage is that, by combining ownerships,
co op members can gain more leverage and demand better prices from
buyers of timber and pulpwood. Yet cooperatives without a loyal
membership and good technical advice have a hit-or-miss record of
success.
          Small landowners also must find a path through the tangled thicket
of forest law. Timber sales, contracts, and the determination of tax
liability all require special knowledge. Because forestry policy
making is a very specialized domain, isolated from scrutiny by the
general public, much of what is on the books is pitched toward
corporations and larger owners. Yet there are opportunities here as
well, particularly with regard to taxation and direct
subsidies. Owners of forestland or timber are afforded favorable
long-term capital gains status on the sale value of their trees, and
on management costs that improve forest growth. Also on the positive
side, a joint state-federal "Forestry Incentives Program" can pay up
to half of the cost of reforesting cutover land, or caring for the
forest. In many areas forest lands qualify for special ad valorem
property tax status, which can reduce the cost of owning
land. However, all of these programs remain under-subscribed by small
land owners. Most do not know of their existence.
          In every Southern state there are federal and state agencies that
could be key players in offering forest management assistance to
minority landowners. These public service organizations are split
between groups concerned specifically with the forest--such as State
Forestry Services--and groups like the Farmers Home Administration
(FmHA), the Soil Conservation Service, and Agricultural Stabilization
and Conservation Service--that are concerned mainly with farmers and
farm owners. The latter group of agencies, especially the FmHA, has
come under sharp criticism for failing to directly address the
problems faced by black farmers. The Civil Rights Commission report
found that the FmHA "has not given adequate emphasis or priority to
dealing with the crisis facing black farmers today . . . The level of
assistance provided [to minorities] is insufficient to correct the
effects of past inequalities or to reflect the urgency of the problem
at hand." One reason for lack of involvement by the FmHA is the small
size of most black farms. American agriculture, and American forestry
as well, emphasize bigness, leaving behind the small scale family farm
for an integrated, corporate, tomorrow. Yet there is persuasive
evidence that small farms are not in themselves less efficient in
terms of crop productivity or energy expenditure. Instead, the problem
largely lies in the language of regulations, in market structures, and
in the perceptions of loan bankers and some agency personnel.
          The same biases and problems carry over to small-scale forest
owners and the agencies they could call on for help. State forestry
services are often closely allied to forest industry, and, in spite of
this alliance, many are relatively poorly funded. These agencies have
also failed to focus imaginatively on the problem of underproductivity
of small landowners in particular, much less on the especially urgent
problems of minority holders. Yet in forestry there remains a
widespread allegiance to the worth of small forests, and this belief
could provide an underpinning for building programs targeted to aid
minority property owners.
          Realizing the full potential of forests to contribute to the
financial health of small landowners will require effort. State and
federal agencies concerned with forestry and conservation will need to
work hard to reach minority landowners. Links to wood and lumber
markets will need to be forged, and small landowners must be open to a
new way of viewing their forest land--as an asset to be carefully
cultivated. This is a long and difficult agenda, but a basic
resilience in the Southern land, which engendered today's productive
pine forest out of agricultural dislocation, gives room for
optimism.
          A sense of this strength in the land comes through in Ellen
Glasgow's turn-of-the-century novel Burren Ground. The
post-Reconstruction southside Virginia is resistent to the efforts of
farmers at cultivation: Although "Spring after Spring the cultivated
ground appeared to shrink into told fields' where scrub pine or oak
succeeded broomsedge and sassafrass as inevitably as Autumn into
Winter," still. "Now and then a fresh start would be made." Like these
lines, the succession of chapters--"Broomsedge, Pine and Life
Everlasting" in the book also signal regeneration. Good management of
the natural tendency of land toward forest can be turned to the
advantage of small landowners, and give them an edge on
survival. Forestry practiced in a way responsible to the land as well
as to the ledger can help minorities to remain in possession of their
rural Southern heritage.
          
            Tom Hatley, native of North Carolina, forester and
writer, is spending the summer at the International Institute for
Applied Systems Analysis in Laxenburg, Austria.
          
        