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60 THE RURAL VOICE
Andrew Grindlay
A woodlot management primer
Over the 20 years I have owned
my two woodlots 1 have learned a
substantial amount about looking
atter them. Here are a few of the
lessons I have learned.
Early on I discovered that it is
possible to manage a woodlot
responsibly with
multiple
objectives. You
can harvest trees
and still leave
nesting places for
wildlife. You can
clear cut small
areas to get more
light on the forest
floor to
encourage the
establishment of
species that need
light, such as
black cherry or
white pine. And
you can tap maples for syrup without
destroying their value for lumber
later, although you probably will
reduce or eliminate the chances of
getting a veneer log out of the trees
you have tapped.
With farm commodity prices so
low, the woodlot has become a
valuable source of income for
farmers because the price of lumber
has continued to increase for about 20
years. After all expenses, uplands can
now easily yield over the long term
about $200 per acre per year and
lowlands around $ I00 per acre per
year. That means that a 300 -acre hard
maple bush that has not been tapped
could yield up to $60,000 per year on
average over the long term with
practically no work except thinning
occasionally.
Although the Canada Customs and
Revenue Agency (CCRA) might
change the rules at any time, at the
moment the sale of standing timber
from a farm woodlot can, in some
circumstances, be treated as a capital
gain and therefore require income tax
to be paid on only half the sale price.
A little known ruling of the tax court
says that the tax on the sale of
standing timber need only be paid
when the land is sold. Further, the
revenue from tree sales can be
included in the $500,000 capital gains
exemption for qualified farms.
Consequently, if a farmer pays
attention to the tax rules, he or she
might not have to pay any income tax
on a standing timber sale and at most
will have to pay tax on only half the
revenue and only when the property
is sold or handed on to another
member of the family. But be
careful; there are some restrictions.
CCRA says that for a standing timber
sale to be treated as a capital gain,
and thereby get the favourable tax
treatment, the sale must be incidental
and not something that is done
frequently. The trees must be cut by
the timber buyer — not the woodlot
owner — and the price must be a
fixed price, not based on quantity or
quality.
• Most farm woodlots in
Southwestern Ontario can withstand
and might even benefit from an
improvement cut about every five
years. The key is to identify as crop
trees those that are of high value,
such as hard maple, white oak or
black cherry, and then remove any
lower value trees that are crowding
their crowns.
Responsible woodlot owners,
however, will ensure that they leave a
few old, tall trees, especially those
with holes, for wildlife.
Many a farmer has lived to regret
the day that he said "okay" to the
logger who knocked at the door and
said he would "log the bush" and pay
the farmer whatever the logs were
worth. The farmer had no idea of how
many trees were cut or their value.
Now farmers either mark the trees
to be taken out or hire a forestry
consultant to do it. Then, several
loggers are invited to bid on the lot
and a contract is signed specifying
how and when the trees are to be
removed and for what total price.
Remember to insist on getting full
payment for the logs before any
cutting is done.
Not all sawmills will buy black
walnut. Sawdust and chips that have
walnut mixed in cannot be sold to
horse stables because of the juglone,
a chemical in walnuts that might
cause acute laminitis in horses.