EUROSTAT
Directorate E: Sectoral and regional statistics
Unit E2: Environmental statistics and accounts; Sustainable
development
21 November 2014
Doc. FO/TF Dec. 2014/06Item 6 on the agenda
Forestry Statistics and Accounting
Task Force to review IEEAF
Availability of estimation methods for wooded land and timber
11-12 December 2014
BECH building, Luxembourg
5, rue Alphonse Weicker, Room B3-404
Starting at 09:30
Ending at 17:00 on 12 December
[(]
Delegates are invited to bring copies of the documents provided on CIRCABC. All documents will be available in English only.*
Note that links to documents on CIRCABC do not work in Microsoft WORD. To open such a link, copy it and paste it into your browser. Get access to CIRCABC by applying for an ECAS password in the system. Some domains are not public; you must apply to the administrator to receive access for your user ID.
The purpose of this document is to present an overview of the estimation methods available for wooded land and timber in order to check whether the proposed tables and accounts can be filled. The sources used are accounting standards and other sources.
As there is a special Task force of Eurostat and OECD working on the valuation of land, the present document will be limited to an overview of methods. A detailed publication entitled 'Compilation guide on land estimations' from the special Task force should be available soon (a first draft was part of the documents of the 2nd meeting of the present TF).
The valuation of timber is described in detail in Eurostat's IEEAF manuals. The greater challenge is to first get reliable estimates of physical timber production.
Questions to the members of the Task force are in bullet points.
A. Wooded land
The general definition of land from The European System of Accounts (ESA) 2010[1] is the following:
Land (AN.211) / The ground, including the soil covering and any associated surface waters, over which ownership rights are enforced. Excluded are any buildings or other structures situated on it or running through it, cultivated crops, trees and animals; subsoil assets, non-cultivated biological resources and water resources below the ground.Going beyond land as an economic asset, the UN System of Environmental-Economic Accounting 2012 – Central Framework[2] (SEEA 2012) says:
5.239 Land is a unique environmental asset that delineates the space in which economic activities and environmental processes take place and within which environmental assets and economic assets are located.
…
5.246 Land use reflects both (a) the activities undertaken and (b) the institutional arrangements put in place for a given area for the purposes of economic production, or the maintenance and restoration of environmental functions. In effect, “use” of an area implies the existence of some human intervention or management. Land in use therefore includes areas, for example, protected areas, that are under the active management of institutional units of a country for the purpose of excluding economic or human activity from that area.
5.247 Not all land in a country is used following the definition above. Some areas are “not in use”, although they may have a use in supporting ecosystems and biodiversity. In order to provide a complete accounting for land use within a country, both land in use and land not in use must be included.
A.1 Wooded land, sources for physical estimates
A.1.1 National forest inventory (NFI)
National forest inventories are the classical source of data on the extent of high forest. Depending on the country, the NFI may also cover 'Other wooded land' and parts of 'Other land with tree cover'. In some countries, there may be no data available on 'Other wooded land' according to the FRA definition because there are legal definitions of what constitutes forest land and nothing else is included in the NFI.
For all areas covered by NFIs, the country should use these data as the starting point to fill in Table 1. The known annual changes should be used to update Table 1 in all years following a NFI, right up until the next NFI, when the data will be adjusted (column on statistical reclassification) to fit the new NFI data. Working together with the persons responsible for producing the Land use, Land Use Change (LULUCF) reports will ensure that the data used and estimated are officially agreed.
Estimating both the area and the value of wooded land beyond the border of the NFI is a problem in many countries. The following points attempt to address this problem.
A.1.2 National land cover / land use survey
· How often are land cover surveys done in your country?
· Do they cover different types of wooded land, e.g. 'Other wooded land' and 'Other land with tree cover'?
A.1.3 National register of land
· Does the register of land distinguish wooded areas outside of high forests?
· Is the value of transactions recorded when the land changes ownership?
A.1.4 Felling permit or concession on land outside of high forests
· Do felling permits cover the area to be felled?
· Do felling permits record values?
A.1.5 LUCAS project
Up to now, the EU's Farm Structure Survey (FSS) lacked definitions of short-rotation coppices, short-rotation forestry and agro-forestry. Good definitions are however available; in the reference document 'Collected terms and definitions', Eurostat highlighted useful parts from several definitions. The highlighted parts can be summarised as follows:
Agro-forestry: a land-use system that involves deliberate retention, introduction, or mixture of trees or other woody perennials in crop and animal production systems to take advantage of economic or ecological interactions among the components (Dictionary of Forestry, Helms, 1998, Society of American Foresters, as used in the 2006 IPCC Guidelines for national GHG inventories).
Short-rotation forestry: the practice of cultivating fast-growing trees that reach their economically optimum size between eight and 20 years old; each plant produces a single stem that is harvested at around 15 cm diameter (Forest Research, Review of growth and environmental impacts, 2011, McKay (ed.)).
Short-rotation coppices: densely planted high-yielding varieties of tree species harvested on a 2-5 year cycle (commonly a 3-year cycle) following coppice of the first establishment year's growth. This forms a multi-stem plantation, with each stool producing up to 20 shoots (TSEC-Biosys: Bioenergy Crops UK, 2006). A plantation could be viable for up to 30 years before re-planting becomes necessary, although this depends on the productivity of the stools (DEFRA, Short Rotational Coppice - Best Practice Guidelines (PB7135), 2011).
Eurostat's 2015 LUCAS project will collect data on short-rotation coppices, short-rotation forestry and agro-forestry using the above definitions. These data could be a starting point for estimates of the area devoted to the three types of land use. For practical reasons, the field workers will only be able to collect data on 'Other land with tree cover', because the identification of such plots within Forest and other wooded land would be too time consuming.
A.1.6 Data collected through the three-yearly Farm Structure Survey and the ten-yearly Agricultural census
The FAO is working to develop the World Programme for the Census of Agriculture 2020 (WCA 2020[3]). The draft brings together the long-standing FAO definitions of 'Forest' and 'Other wooded land' and creates a new overarching category called 'Woodland', referring to SEEA 2012[4] to justify this change. There is however no 'Woodland' in SEEA 2012, but the proposal well fits the aim of the IEEAF review of covering all timber cultivated on agricultural land (WCA 2020, p. 119):
"8.13.4 Because of the above considerations, the concept of woodland is introduced for the purposes of the present theme. It refers to the area of land satisfying all criteria for either forest land or other wooded land (see paragraph 8.02.25) except the criterion of spanning over 0.5 ha. Presence of woodland refers to whether such areas are present on the land making up the agricultural holding. The reference period is the day of enumeration.
1302 AREA OF WOODLAND (for the holding)
Reference period: the day of enumeration
a. Forest land as primary land use
b. Other wooded land as primary land use
c. Forest land as secondary land use on agricultural land
d. Other wooded land as secondary land use on agricultural land
e. Other woodland
8.13.5 This item collects data on the total area of woodland on the holding as defined in paragraph 8.13.4, further subdivided into various components. The total area of forest and other wooded land as a primary land use is given in the land use classification in Item 0202 (see paragraph 8.02.25). Sub-items a. and b. sub-divide it into its two components. Sub-items c. and d. refer to those areas on the holding that satisfy the criteria for the forest land and other wooded land (see paragraph 8.02.25), respectively, but were classified as agricultural land according to their primary land use. Agricultural land covers arable land, land under permanent crops and permanent meadows and pastures (see paragraph 8.02.32). Sub-item e. covers those areas that span less than 0.5 and satisfy all other criteria for either forest land or other wooded land." (highlighting by Eurostat)
The draft WCA 2020 comprises fifteen "Frame items" for countries applying a modular approach to their agricultural censuses. Two of them are
1301 Presence of woodland on the holding
1304 Whether agro-forestry is practiced
The draft WCA 2020 includes a new definition of agro-forestry that is very useful for statistical purposes:
"8.13.13 Agro-forestry is a sustainable land management system in which forest species of trees and other wooded plants are purposely grown on the same land as agricultural crops or livestock, either concurrently or in rotation. Agro-forestry is characterized by the existence of both ecological and economic interactions between the different components. Agro-forestry includes agrosilvicultural (trees and crops), silvopastoral (trees and livestock), and agrosilvipastoral (trees, crops and livestock) systems.
8.13.14 Agro-forestry refers to specific forestry practices that complement agricultural activities, such as by improving soil fertility, reducing soil erosion, improving watershed management, or providing shade and food for livestock. Countries need to develop their own procedures to collect the data on agro-forestry systems. Some may wish to collect data on specific agro-forestry activities. The reference period for agro-forestry data is the census reference year."
The national implementation of the FSS is left to countries, some of whom may already be collecting data on the extent of short-rotation coppices, short-rotation forestry and agro-forestry.
Eurostat's unit E.1 is willing to explore gathering data on woodland in the next agricultural survey.
Such data could be collated with NFI data in cases where the NFI only covers larger tracts of forest.
· In your country, does the NFI include surveys of all wooded land outside of forests?
· Alternatively, is there a need to collate data from different sources to estimate the area of 'Other wooded land' and the activities short-rotation coppices, short-rotation forestry and agro-forestry?
· Which definition of agro-forestry should be used for IEEAF?
· Are you happy with the definitions proposed for short-rotation forestry and short-rotation coppices?
A.1.7 Data from rural development support measures
Regulation (EU) No 1305/2013 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) foresees support measures for short-rotation coppices, short-rotation forestry and agro-forestry for 2014-2020.
The establishment of both short-rotation forestry and agro-forestry areas can receive support under Articles 21, 22 and 23, measure 5e ' Fostering carbon sequestration in agriculture and forestry ' (p. 69). Beneficiary Member States will have to supply annual reports to the European Commission, covering the total number of beneficiaries, the total hectares and the total expenditure for the establishment of such areas.
While this cannot provide the total area devoted these practices, it can provide an indication of the value per hectare at the time of planting. The agricultural census could ask for the expected harvest of timber (m3) at maturity and the time until maturity.
Short-rotation coppices can receive support under Article 7, measure 4, for farm investment measures (not forestry). Only the value of the investment will have to be reported to the Commission, without the hectares. The area information may however be collected by the countries for administrative purposes. Default values could then be used to estimate the timber resource if the species of tree is registered.
A.2 Wooded land, sources for monetary estimates
ESA 2010[5] has the following on the valuation of land:
"7.50 In the balance sheet land is valued at its current market price. Any expenditure on land improvements is recorded as gross fixed capital formation and the additional value it provides is excluded from the value of land shown in the balance sheet and is instead shown in a separate asset category for land improvement (AN.1123).
7.51 Land is valued at the estimated price achieved if sold on the market, excluding the costs involved in transferring ownership for a future sale. When a transfer does occur, it is recorded by convention as gross fixed capital formation and the costs are excluded from the AN.211 land value recorded in the balance sheet and instead recorded as an AN.1123 asset. This is reduced to zero through consumption of fixed capital over the period that the new owner expects to use the land.
7.52 If the value of the land cannot be separated from that of buildings or other structures situated on it, the combined assets are classified together in the category of the asset that has the greater value."
A joint Eurostat/OECD Task force is producing a 'Compilation guide on land estimations'. The available draft text cites both direct and indirect methods for valuing land, depending on data availability. A quote from the draft text:
"An indirect estimation method, as the name implies, either obtains the value of land indirectly or obtains the price of the land indirectly. There are three different indirect estimation methods: the residual approach, the land-to-structure ratio approach, and the hedonic approach. The first two indirect approaches derive the value of the land indirectly. The residual approach obtains the value of the land by subtracting the depreciated structure value from the combined total value. This method controls to the estimated real estate value of the property; therefore, care should be given because some countries derived negative values for the stock of land utilising this method. The land-to-structure ratio (LSR) approach derives the value of the land indirectly by multiplying the depreciated structure value by the LSR. An LSR that is representative may provide (for certain countries) a higher quality estimate of the value of land compared to the value of land derived residually. The LSR approach does not control to the total real estate value so there is no chance that the value of land could be zero. The hedonic approach utilises a hedonic regression model to deconstruct the real estate property value (that is, the combined value of land and structures) into separate prices for the land and for the structure. The total value of land is then derived by multiplying the indirectly derived price by the area of land."