Eucalyptus debate continues

       The impact of farming eucalyptus trees on Thailand's ecosystem remains a highly controversial topic for agriculturists, academics and state officials.
       Some academic research says eucalyptus plantations have a devastating effect on the environment as they dry up groundwater reserves and leach vast quantities of nutrients from the soil.
       But officials and the pulp and paper industry see the tree as a lucrative cash crop that could help reduce farmers'poverty levels.
       "There have been studies that say the [eucalyptus] tree has no adverse effects on soil fertility and water levels.The farmed tree business is a source of additional income that also adds green areas to the land," said Charnvit Jarusombathi, senior executive vice-president of the pulp and paper company Advance Agro Plc (AA).
       AA has encouraged farmers to grow eucalyptus for 19 years to supply wood chips for its pulp and paper mills.
       In 2002, the company heavily promoted eucalyptus as a paper crop and suggested farmers grow the trees around the borders of their rice fields.
       Today, some 1.2 million rice farmers grow paper trees in such a manner. The crop provides a supplementary income of about 16,000 baht a year for 20 rai of rice growing 1,600 trees.
       Recent reseach conducted by Kasetsart University and the Thailand Research Fund says growing eucalyptus trees in rice fields has less impact on soil and water quality growing them as a standalone crop. These results support other research findings that suggest growing trees for pulp as a mixed crop is less damaging to the environment than as a single, unrotated crop.
       AA has more than 100 breeders to develop high-yield tree varieties tailored to meet local climatic and soil conditions.It has tested more than 2,500 eucalyptus varieties to create hybrids that produce high yields, are insect- and droughtresistant, and can be harvested in three to five years, said Mr Charnvit.
       As part of its eucalyptus promotion strategy, AA provides farmers with 101 free saplings each and guarantees to buy back the trees three years after planting for 30 baht each.
       The company will also allow farmers with bigger land plots to take as many free saplings as they like, to be bought back at 30 baht each three years later.
       But the most popular scheme for is to buy saplings at five baht each, and sell the wood back to AA at prices guaranteed between 55 and 70 baht per tree.
       "Participants of the first two schemes bear no cost but have used their workforce to take care of the trees. However,all participants get technical assistance from the company," said Mr Charnvit.
       At present, there are 175 million paper trees grown on rice and cassava plantations nationwide. Most are in the northeastern provinces. AA plans to increase the figure to 500 million by 2012.
       The company expects its farmed-tree business to produce about 580,000 tonnes of short-fibre pulp this year for its two paper manufacturing plants.
       The plants also use imported longfibre pulp to annually make about 600,000 tonnes of Double A-brand writing paper.
       AA distributes its products in more than 100 countries, and the firm has with 18 representative offices overseas.
       Writing paper is the company's major revenue source.
       AA forecasts revenue of 20-21 billion baht this year, on a par with 2008. Exports will account for about 55% of income.
       The company earlier reported plans to build a third paper mill to increase its annual capacity to more than 1 million tonnes.
       But the initiative is on hold because of the downturn, said Mr Charnvit.
       Last year 542,694 tonnes of writing paper was sold domestically, down 15%from the year before, according to Industry Ministry figures.
       The sector showed improvement in the first quarter, when sales rose nearly 8% year-on-year to 62,450 tonnes.