environment

Challenges for native plant nurseries

The news a hefty chunk of new grant money for the One Billion Trees project will be aimed at native trees should have set off a chorus of popping champagne corks in the native plant nursery industry. Instead it’s created concern.

Medium and small native plant nursery owners see the One Billion Trees goal as wonderfully aspirational, but worry it will add further pressure to an industry already facing challenges.

Large restoration and amenity projects have resulted in tenders for hundreds of thousands of native plants at a low cost. Some industry insiders describe tenders as an exercise of “undercutting to nothing” and “a race to the bottom” for an industry where profit margins are already pinched.

Several growers mentioned a tender resulting in a price of $1.75 per plant. This included the cost to deliver the plant to the planting site. There’s concern a push for more natives could create more tenders which push prices down even further.

The high-profile Native Plant Nurseries went into receivership in April. Oratia Native Plant Nursery ceased general trading in August as the owners retire and a new buyer has not been found. Kauri Park Nursery is one of the few remaining nurseries capable of producing large numbers of native plants.

"What I am not going to do is grow a million plants unless I’ve got a contract for them. I’m not big enough to do that.”

North of Auckland, Jane Straka from Scrub supplies native plants for restoration projects. In the past decade the price of the plants she sells hasn’t changed much despite rising costs.

“Our prices have been stable for five to 10 years. There’s been no real price growth with changes in wage rates, fuel costs and material costs. That does pinch the profit margins.”

Straka said she’s yet to see the impact of the One Billion Trees project on orders for native plants. Presently she sees tenders with roll in with short timeframes to produce thousands of plants. She thinks there’s a need for contracts with reasonable lead times and deposits to fund growing.

According to Straka only one or two nurseries in New Zealand are big enough to grow speculatively.

“If I knew someone was going to buy an additional million trees off me next year, on top of what I normally grow, no problem. I would scale up and grow them … What I am not going to do is grow a million plants unless I’ve got a contract for them. I’m not big enough to do that.”

“Tenders are so big, they are too risky.”

Millwood Nursery’s owner Richard Wisker is another plant grower who supplies plants for restoration projects. Currently much of his work is growing trees under contract to restore land used for gold mining. He has avoided tenders for the last two years.

“I think they are unrealistic and largely you can’t make any money out of them. It’s a race to the bottom. We’ve just seen one of the longest-standing restoration nurseries go belly-up right in the middle of a huge project.”

Wisker is not only concerned about price. Unforeseen delays in projects can pose a problem for nurseries, whose plants are not needed until the end of a project.

In one case he said a motorway project ran 10 months over schedule leaving a nursery “choked with hundreds of thousands of plants”.

“You didn’t make any money off the crop you just sold, and you didn’t make any money off the crop which should be going in the ground.”

As well as delays short lead times are another issue with large projects.

“There are some tender documents floating around for a big wetland project, but from what I have heard the timeframes are ridiculously short. Nobody would have the infrastructure and resources sitting there waiting to say, ‘We’ll have a go at that and see how cheap we can do it.’ I think it’s become a dangerous thing to get involved in.

“Tenders are so big, they are too risky.”

“We don’t want to start creating a playing field where we supported one nursery and they undercut everybody else and everybody else goes to the wire and goes bankrupt.”

Te Uru Rākau is the Ministry for Primary Industry’s forestry arm spearheading the One Billion Trees project. Head of forestry Julie Collins said she expects the grants scheme to fund 125 million native trees over the next 10 years.

The grants scheme is aimed at encouraging "the sort of planting that won’t otherwise happen" and to reintegrate trees back into New Zealand's landscape.

A partnership fund will also be launched in October. This will be aimed at helping nurseries.

"We are looking to use that to support some of the enablers of tree planting. How do we support nurseries to stand up?"

Collins said Te Uru Rākau is talking with the New Zealand Plant Producers Incorporated, an industry body, about how to help nurseries scale up.

“We don’t want to start creating a playing field where we supported one nursery and they undercut everybody else and everybody else goes to the wire and goes bankrupt.”

“It’s so much easier destroying forest rather than planting it, and that’s what we did."

Fern Factor’s Paul Michael thinks helping nurseries goes beyond injections of cash. He would like to see training for project managers who specialise in large-scale planting projects to help achieve the goals of the One Billion Trees project.

“It’s hugely exciting and hugely challenging and we as the nursery industry need to step up, somehow get ahead of some of these projects and get our input into the process.”

For the example of the wetland restoration project Michael said a project manager could have suggested timeframes need to be extended for species where seed collection needs to take place in winter.

He also sees opportunity for new businesses to be created, in particular around seed collecting where he thinks there is room for a nationally accredited eco-sourced seed supplier. This would assist growers in responding to tenders with seeds which are guaranteed to come from the correct area.

Despite the challenges the industry faces, and the concerns it has around meeting upcoming demand he said the level of passion in the native plant industry is high.

“It’s so much easier destroying forest rather than planting it, and that’s what we did.

"Good on the government for setting the aspiration."