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Forico’s data driven approach to forestry pays off

forico, the venture magazineGrowing a forest is an exercise in patience. It takes extensive preparation, careful planning, and years — sometimes decades — of maintenance. All the while, the foresters hope that at the end they have the healthiest trees they can grow. They don’t have many chances for do-overs. For Tasmanian forest management company Forico, these are the facts of doing business. So it’s no wonder they’ve developed some innovative ways to ensure the end product is of the highest quality.

“People often think of forestry as cutting down trees, but of course you’ve got to grow them. They grow for many, many years, it’s not like an annual crop,” Forico CTO Dr Andrew Jacobs told VENTURE. “Our hardwood plantations are in the ground for 13 to 15 years, but some of the Pinus radiata will be in the ground for 30 years. So it’s a very unique business, with a very long-term outlook.”

Seed to Forest

forico, the venture magazineForico sell wood chips for the manufacture of paper, packaging, hygiene products and textiles, and whole logs for structural timber or engineered wood products such as veneers and laminates. Getting to that end product is a labour of love, and Forico’s supply chain starts with tree breeding. They grow three species: the hardwoods Eucalyptus nitens and Eucalyptus globulus, and the softwood Pinus radiata. Elite plants from the breeding program are used to establish seed orchards. Seeds go from seed orchards, where they are harvested in bulk and are sent to the nursery.

After about 8-12 months in the nursery, the seedlings are vigorous enough for planting, which takes place June through October and is quite weather-dependent. Contractors prepare the plant site — almost always a spot which has seen a harvest before — and contractors plant the seedlings between the stumps of a previous plantation. “That’s 8 million seedlings by hand,” Jacobs said. “It’s pretty amazing when you think about it, especially when you consider the conditions and terrain.”

Once the seedlings are in the ground, Forico’s foresters manage the plantation through its life cycle, performing tasks such as weed and pest control, reducing fire risk, and making sure access is clear for the eventual harvest. Annually, Forico harvest about 7000 hectares of forest over the 92,000 hectares of plantation they manage, producing 1.5 million green metric tonnes of timber on a sustainable basis.

Volume & Scale

forico, the venture magazineOperating at such scale in terms of both time and space lends itself to big data and advanced analytics. Forico have embraced such technology wholeheartedly, using drones and remote sensors for planning and inventory assessment. They’re getting more and more into precision forestry, performing soil analyses and understanding which species grow best in which types of environment.

Their fibre technology lab “is a pretty unique facility in Australia and gives us the capability to assess the properties of the wood fibres that we export and the properties of the pulp and paper which will be produced so it gives us insight into the quality before the ship arrives at the customer’s port,” Jacobs said.

Forico are also the first company in the world to deploy DNA marker assisted selection at scale to a commercial tree breeding program. “Our hope is that this will enable us to identify and select elite individuals and that we can push them through our breeding program more quickly using this approach. The technology allows us to select elite material at the seedling stage instead of waiting six to seven years for wood quality characteristics to reveal themselves”. In a business with little room for error, this is a revolutionary development.

Rather than measure and pay by weight, Forico are the first company in Australasia to adopt a volumetric based payment system for wood, which results in more fibre per shipment with fewer trucks on the road. “There are several advantages with the shift to this technology. Firstly, we’re moving away from a system that encourages the transport of wet, heavy logs, the water in a log has no value in a forestry business, and secondly it allows us to focus more on the fibre, which is what our customers want. Less water in the logs means more fibre can be transported per freight task,” Jacobs said.

Commitment to Sustainability

forico, the venture magazineWith such a long-term outlook and so much reliance on nature, there may be no business model more driven to practice sustainability than Forico’s. They’re the first forestry company in Australia to successfully auction carbon credits under the ‘plantation methodology’ of the Australian Government’s Emission Reduction Fund. The amount of carbon Forico’s estate stores — approximately 40 million tonnes — is equivalent to the annual greenhouse gas emissions of 30 million cars or annual carbon dioxide emissions from 37 coal-fired power stations.

The measurement is part of Forico’s larger scale look at natural capital accounting, taking stock of what the clean air, water, and natural habitats of their estate add to society. “The big question of course is, ‘What is the value of it?’ And if it has no value, then obviously protecting it is problematic,” Jacobs said. To quantify the value, Forico use globally established frameworks for assessing ecosystem services and combine this with their internal business geographic information system (GIS) and finance system to create a set of natural capital accounts for the estate that will then be independently valued and verified.

Such initiatives earned Forico wins for forest growing and management excellence and environmental excellence at the 2019 Tasmanian Timber Awards and Employer of Choice status with the Tasmanian Government. With a view toward “sustainable production of the ultimate renewable timber,” Forico have no trouble seeing the forest for the trees.