Coillite Farm Forestry Partnerships leave farm families wondering when they will receive money from thinnings.
Coillte Ireland’s largest forestry company have come under fire over their contracts with individuals in its Farm forestry partnership programs.
That’s Farming can reveal that individuals who entered into Farm Forestry Partnerships with the semi-state company in the 1990’s have been locked out of their own properties, left questioning the transparency of the company and left waiting for thinning’s income contrary to today’s industry standards.
Farm Forestry Partnerships
Farm Forestry Partnerships began in 1992 and there are approximately 700 farm partners in the scheme.
Farm Partnerships work in that a farmer enters a contract with Coillte that their land be planted. The farmer retains ownership of their land and she or he can opt to receive a tax-free income for the life of the crop as well as an advance payment of up to €635 per hectare.
Coillte manage 440,000ha of forests and sell over 2.5 million cubic metres of timber every year.
The forestry company state that clients of their farm partnership schemes benefit from Coillte’s management and marketing skills through the life of their crop and receive a larger share of the clear fell products.
Coillte Farm Partnerships are joint ventures between farmers and the forestry company. The semi-state company delivered a record earning of €98.3 million in 2016 a 10% increase on the previous year.
Thinnings, the process of removing unwanted branches, smaller trees etc. from the plantation occurs on average two to three times in the lifespan of a commercial forestry crop. This maintenance was in the past not a commercial activity and contracts signed with farm partnership partners in the early 1990s in many cases did not make specific mention of thinning and its economic benefit. However, in today’s market thinning is now worth on average €200 per acre.
That’s Farming has seen a number of Farm partnership contracts signed in the 1990s which did not reflect the commercial aspect of thinning.
We have been informed of one case where an owner has had 2 thinnings occur on their mature forestry plantation estimated to be worth €70,000. The resulting money from the sale of the thinnings should have been paid to owners immediately as we have been advised by industry leaders is now standard practice.
However, under dated contracts with Coillte owners are not being paid thinnings earnings until 2 years after their premium of 20 years has ended.
Whilst this is not illegal it has left many owners in severe economic circumstances.
One owner we spoke to whom has three young dependants under 18 and is unable to work is now in a situation where their premium has stopped and they will not receive thinnings income until 2019, two years after the fact. Whilst being legally covered it has left the owner without financial income for 2018 on which they are solely dependent and does not now reflect industry norms of thinnings payments.
Solicitor James Staines has looked at farm forestry partnership contracts with Coillte and highlighted that thinnings issues were a problem area.
‘Coillte now have to adhere to the industry norm in relation to thinning. Coillte need to engage with other parties to ensure they adhere to best industry practices.’
Staines added that the forestry companies practices could be seen as ‘high-handedness and that people aren’t being given all the information.’
Forestry industry leaders confirmed to That’s Farming that the payment of thinnings are now paid immediately with private companies.
‘A lot of people are not happy with the Coillte farm partnerships. It’s widely known in the forestry industry,’ the forestry representative who did not wish to be named said.
Lack of communication
Farm Partner members have expressed anger over the lack of communication from Coillte.
One partner said:
‘The communication internally is dreadful as nobody seems to know who takes responsibility of any area…[There has been] no communication and when asking a question, we were handed from ‘Billy’ to ‘Jack’ with no concrete answers.’
The same owner cannot get a clear answer on what their annuities will be.
Other partners That’s Farming spoke with expressed that ‘they may have been misled. There was very little information given to us at the time about how much timber was worth per acre.’
No idea what’s happening
Independent TD Michael Fitzmaurice speaking with That’s Farming before appearing at an Oireachtas committee with Coillte today said;
‘There are people who haven’t been informed since 2007 on what’s happening regarding tonnage, thinnings etc on their land.’
One owner we spoke with cannot gain access to their planted landed despite contract agreements that they have access.
‘There’s a gate going across my plantation to keep out trespassers but I should have a key which I haven’t.’
Farm partners have expressed concern as to insurance payments for their plantations with owners paying in some cases €700 per year but their contracts are not clear as to what the insurance covers.
Solicitor James Staines expressed concern about the insurance payments saying that ‘contracts are unclear as to who should pay the insurance.’
Michael Fitzmaurice TD expressed his dismay at Coillte’s dealings with farm partners.
‘It seems to be a very unusual setup that you cannot go onto your own land without coillte authority, odd that you have to pay the insurance and in the deal that’s done (in relation to the contract) you have no say when the timber will be taken out and what the price will be.’
‘The whole deal seems to be lobsided towards coillte’s favour,’ he added.
All farm partners That’s Farming spoke with said that if they knew now about Coillte practices they would not have entered their contracts.
One farmer said: ‘I want to get answers. I want to know how much was made from my thinnings in money. I want to know how much I will be getting…I hope this reaches the Dail and the media. Mabye then, Coillte might have the decency to speak up and answer our questions.’