Tropical Farm Raises Tropical Hardwoods
FDM Magazine, August 1999 - a magazine for builders of cabinets, fixtures, furniture, and millwork
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Tree Farm Raises Tropical Hardwoods
FDM Magazine, August 1999
By Anne Marie Moss
Filling a profitable demand, Tropical American Tree Farms raises tropical hardwood trees for commercial harvest and environmental protection.
Teak. Purpleheart. Mahogany. Brazilian cherry. Sounds like a list of the world's most exotic - and expensive - wood species, right?
But it's just inventory for Tropical American Tree Farms, San Isidro, Costa Rica, near the Pacific coast.
Since 1992, TATF has been cultivating tropical hardwood species for commercial harvest on tree farms. Although it started as a personal venture by married couple Steve and Sherry Brunner, president and vice president respectively, the business soon piqued the interest of others, and now it's raising 1 million trees over 6,700 acres for approximately 750 individuals, companies and trusts.
Clients of TATF are tropical hardwood tree owners. They choose a species or combination of species from a selection of 17, and pay the cost of raising the trees. Owners receive the profit from the lumber sold during the 20- to 25-year growing and thinning period, and, ultimately, from the sale of mature exotic hardwood.
The Brunners have conducted business in Costa Rica since the mid-1970s, investing in coastal property and building cabanas for rent. When they wanted to construct more wooden bungalows, an architect told them that the tropical hardwood needed to survive the region's wet climate was too scarce and costly. "That was when I thought, 'Gee, I wonder if you can tree farm these woods,' " says Steve. "Prior to that, no one in this section of the world was doing
it."
After a decade of research, TATF was established. The company has acquired about 15 individual farms in six general regions since its inception.
While TATF owns the land, its clients own the plots of trees. "And they are very specific trees," says Steve. "Owners receive a copy of their entry into our tree registry, which would show what farm, what field and even in what row their trees begin and end. They can go to that spot and there will be a plaque with the initials of the company or individual. "Clients can come down any time to visit their trees.
So far, about 300 have made the journey.
Trees are sold in units of 100, "so we can maintain our sanity," laughs Steve. "Many owners have 1,000 trees; some have more than 10,000."
Most of the TATF's company clients are in the wood business, such as custom furniture and cabinetmakers, sawmills or lumber retail outlets. "And a few tree owners don't tell us who they are or what they're doing, and that's really none of our business," he adds.
The price of the trees varies among the 17 available species. For instance, teak and cocobolo cost more than others because of factors like seed availability, speed of maturation and growth characteristics. For all species, the price decreases as the number of trees ordered increases.
It costs around $2,200 to grow 100 purpleheart trees, when labor hours and equipment are factored in. But, except for teak, there's no way for Steve and Sherry to know how much the lumber will earn on the market once it's been harvested. "There are two principal factors that affect harvest profit. One is the amount of wood production that comes from the trees, which is determined
by the rate of growth and ratio of heartwood to sapwood. The other is the economics of the particular species, how rare it is when it's matured after 20 or 25 years," says Steve.
The Brunners can offer a good estimate on teak because that species has been raised on farms for generations in Indonesia and in other parts of the world. The investment for 100 teak trees would be about $3,200. "A 25-year-old teak tree, when we do the final harvest, would be about 75 feet tall and about 20 inches in diameter. This would yield about 500 board feet," says Steve. "And if the wholesale import/export price at the beginning was $3 per board foot, and it increases at about 6 percent a year, that tree will be worth about $6,000 to $7,000."
Once it's ready to harvest, tree owners can choose to have the lumber shipped directly for their own use, sell it themselves, or let TATF sell it on the wholesale import/export market. Steve notes that some U.S. lumber retailers can reap up to three times as much for tropical hardwood as TATF can at wholesale prices, but many clients don't want to deal with the process.
Not all of the initial 100 trees planted will make it to the final harvest. Throughout the trees' lifespan, TATF must thin out the plots periodically to make room for the heartiest trees. "We can sell that lumber along the way, but always with an eye for the most production from the best trees. You save the best for last and there will probably be 10 or a dozen of those from the
initial 100," explains Steve.
So how does TATF make its money? "Our real profits come at the time of the harvest," says Steve. "If you have us sell the wood, the first money goes to you until you've gotten your investment back. Then of the net harvest proceeds after that, we get 6 percent."
Tree owners that want to keep the lumber for their own use or sell it themselves must alert TATF 60 days prior to the harvest, pay cutting and shipping costs, and give the company the 6 percent of the wholesale market rate at that time. "It's really cost effective for lumber users and retailers to do it this way," says Steve.
When they started, Steve and Sherry knew that they wouldn't be seeing any profit from TATF for a number of years. In fact, TATF's annual lumber sales right now is zero. But this year will see the first commercial thinning harvest, and Steve predicts that sales will catapult to $1 million, depending on the demand for the wood.
And the company has no reason to believe that demand for tropical hardwoods will lessen, especially as rainforests dwindle and environmental laws tighten.
TATF gets its seeds from a variety of sources. Many of the seedlings come from an international professional seed bank, others from the company's nursery or rain forest property. Finding enough seeds from healthy adult trees for each species is one of TATF's biggest challenges.
Other difficulties are nature-related, from the chance of severe weather to an insect infestation. To safeguard against pests and diseases, TATF only grows species that naturally thrive in the Pacific coast region of Costa Rica. The tree farms are constantly monitored and action is taken quickly if a problem is spotted.
The humid climate of Costa Rica makes it an ideal location for growing tropical hardwoods. "We have about 120 inches of rain per year over a nine-month rainy season starting in April, and a three-month dry season. And the dry season allows the wood to stop growing, and it lignifies or hardens up," says Steve.
Additionally, labor is plentiful and less expensive than in the U.S. The native Costa Ricans have proven to be honest, hard-working employees and dependable business associates, he adds.
The company hires 200 workers during the height of hand planting, grooming and harvesting, and that number is halved during the off season. A few foresters work as independent contractors, surveying the farms and training employees. TATF is certified as an environmentally sustainable wood source through SmartWood and the Forest Stewardship Council.
"We're having a great time down here," says Steve. "So far, a lot of the tree growth has exceeded our expectations. It's really gorgeous wood."
For more information on TATF, visit its web site at
www.tropicaltreefarms.com or call 800/788-4918
(sidebars in the article)
Committed to preservation
By the end of 1999, Tropical American Tree Farms will have planted one million trees. "And of those, more than 30,000 are trees we've intentionally planted that will never be harvested," says Steve Brunner, president. "They may be planted to continue the seed source. Or they are flowering, fruiting or sheltering trees for the birds and animals."
Out of the 6,700 acres TATF owns now, only about 40 percent is planted for harvesting; the rest is conserved. "You can go to those forests with a camera, but not a gun or a saw," says Brunner.
When a farm is purchased, the company preserves the existing rainforest land, then scouts the region with foresters to locate new plantable areas. Limiting factors include steep hill slopes or being too close to a stream or river. So the percentage farmed depends on the landscape. TATF's ideal ratio of planted versus conserved land is 50/50.
The species that are planted each year depend upon on how suitable the land is for a tree type and the availability of seedlings. The company is always on the lookout for new farmland.
Brunner is quick to note that TATF doesn't condemn other woodworking companies that harvest directly from the rainforests: "We all have businesses to run and we're just learning how to take care of this world."
TATF's tropical hardwoods
(sold in units of 100 trees)
Bocote *
Brazilian Cherry
Cocobolo
Goncalo Alves
Idigbo
Ipe or Lapacho
Madero Negro *
Mahogany *
Nargusta
Peroba Rosa
Primavera *
Purpleheart
Roble *
Santa Maria *
Teak
Trebol
Wild Tambran *
* available only in a mixed planting
Photos and captions (back to the top of the page)
Tropical American Tree Farms owns six farming areas, covering 6,700 acres. Shown here is a pasture planted with teak. The upper region of existing rainforest will be preserved. Now almost 60 percent of TATF's land is dedicated toward conservation and 40 percent is planted for commercial harvest; the percentage depends upon the land's topography.
Locals refer to Steve and Sherry Brunner, owners of TATF, as como uno, meaning "like one." The couple makes almost every decision involving the business together. While Steve crunches more of the numbers, Sherry takes care of the communication side of the business.
Currently, TATF has 750 tree owners, which are individuals, companies or trusts. Owners get the choice of letting TATF sell the harvested lumber, or they can use the lumber or sell it themselves. Many of the companies are custom furniture and cabinetmakers, sawmills and lumber retailers.
Tropical hardwood tree owners receive a copy of their entry into the tree registry, which shows what farm, what field and what rows their trees begin and end. A plaque with the initials of the tree owner clearly marks the plot, and visitors, like these teak tree owners, are welcome at any time.
Tree owners are offered a selection of 17 tropical hardwood species, and can pick one or a mixture. The trees are sold in plots of 100. During the 20- to 25-year maturation, plots are thinned to make room for the heartiest trees. Both the thinned and the mature lumber is sold for tree owners' profit. TATF receives 6 percent of the sales based on the wholesale import/export market. Shown are 5-year-old nargusta trees.
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