An independent TD has raised concerns that farmers could be forced to compete for land as state forestry company Coillte seeks private investment companies to meet afforestation targets.
Deputy Michael Fitzmaurice has warned of a situation where small-scale farmers will have to compete with private investors, which will buy up land for planting and draw grants for doing so.
Coillte earlier this year announced plans to enable the creation of 100,000ha of new forests by 2050. To date, Coillte is responsible for managing 440,000ha, which is 7% of the land area of Ireland.
To achieve this target, Coillte will look at public land to create new woodlands but there is a proportion which has to be acquired in the open market, Coillte Forest managing director, Mark Carlin said.
Carlin, however, could not confirm what percentage of the 100,000ha afforestation target will be planted on public land.
Enabling the planting will cost up to €2 billion between now and 2050, and will require capital from funds including impact investors and traditional long-term investors, chief executive of Coillte, Imelda Hurley said.
“There is going to be a battle around the country for land because Coillte now has investment companies coming in that ordinary farmers will not be able to compete with.
“It is a sad day for the average land in rural Ireland, because those farmers who are trying to survive on [the land] won’t be able to survive,” Deputy Fitzmaurice said.
Private land
Carlin emphasised that it is not in Coillte’s interest to drive up the price of land, but to meet the annual 8,000ha afforestation target, and that Coillte should be operating about 20% of afforestation.
Explaining that the investment funds own the land and therefore draw the grants, Carlin responded to Deputy Fitzmaurice in a recent Oireachtas committee meeting:
“Coillte’s role in this is threefold – first to acquire the land, secondly to plant the land, and third to manage the land as part of our existing forest estate.”
“Private forestry companies need to be part of [afforestation] and farmers are going to have to do the lion’s share of that because they own the land,” he added.
The deputy said he expects funds to be looking to buy up land in parts of the midlands but mostly in the north west, west, and south west, and they will be in the market for nearly between 30% and 50% of all of that land.
He raised concerns that this will leave farmers that are trying to increase their small holdings, especially in those areas, in a ferociously vulnerable situation and distort the market.
Private planters will be left redundant, he said claiming that a lot of farmers would have no problem planting small parcels if they were compensated properly.
While the “only way” Coillte can play a part in afforestation is by acquiring more land, Hurley said they want to enable 2,000-3,000ha annually ramping up over time.
Coillte also aims to redesign 30,000ha of peatland forests by 2050 through a programme of rewetting or rewilding for climate and ecological benefits, which will be undertaken by the company itself.
Private investment companies
Coillte did not say which third parties are involved in the funds, however it will be seeking access to premiums and there is “very significant interest” from Irish as well as international investors.
Capital will be accessed from one fund, the Nature Trust, which is a not-for-profit joint operation between Coillte and Forestry Partners to deliver new afforestation in terms of native woodlands.
To finance commercial woodland, a second fund involving traditional long-term investors will be required, Hurley said.
The Nature Trust is attracting environmental, social and governance (ESG) investors which are not looking for returning the capital, but instead “public value”, she added.
Predicting that most of the private investment companies are going to be overseas, despite Coillte not confirming this, Deputy Fitzmaurice said:
“Whatever reward is out at the end of the day will leave this country and that is sickening to see happening.”
He urged the Tánaiste, Leo Varadkar and the Minister for Agriculture, Food and the Marine, Charlie McConalogue to end Coillte’s private investment plans to increase planting.