Three communities in the Umzimkhulu area have successfully established plantations on communal land and have started their first harvest.
Mabandla Trust chairman Mayford Jaca
The Mabandla villages are spread out in the valley below the plantation.
|Peter Nixon and Mayford Jaca.||
The tractor trailer bundle-loader does the shorthall from the compartment to the roadside depot.
Three community forestry projects established in Umzimkulu area in KwaZulu-Natal (formerly Eastern Cape) have started harvesting their timber, and the benefits of all the hard work that’s gone into the projects over 10 years are beginning to be realised.
SA Forestry magazine visited the Mabandla community project, the largest of the three projects, with Peter Nixon who has been involved in setting them up from the start. On the road leading to Mabandla from Creighton we passed a fully loaded timber truck heading to the Sappi Saiccor mill which was a sure sign that these community projects are starting to bear fruit.
The trees have been planted on the hills above the Mabandla villages. It is excellent tree growing country with around 1000 mm of rainfall a year, good soils and gently undulating slopes.
The first thing that one notices on entering the estate is that the compartments and access roads have been well planned, and the riparian zones are clear of alien vegetation. The trees are looking good with uniform growth, and there is no evidence of Sirex in the pine compartments. This plantation – like the other two projects, namely Zintwala (350 ha) and Lower Lourdes (420 ha) – is FSC certified.
The first person we met was Mayford Jaca, Chairman of the Mabandla Community Trust and a director of the Development Company which manages the forestry operations. He was keeping an eye on a grader busy doing maintenance work on one of the plantation roads.
“This plantation is like our own goldmine,” he told me with obvious pride. “There was nothing here before but now we have work for our people.”
The Mabandla Community Trust was established by the community members to oversee the project and manage the social and community issues. The Trust established the Mabandla Development Company (Pty) Ltd, in which the trustees serve as directors, and which manages the forestry operations. Peter and his partner Themba Radebe, were both Mondi employees involved in setting up the project from the start. When Mondi changed its strategy and withdrew from the project in 2000, Peter and Themba left to form Rural Forest Management cc which provides management and administrative services to the Development company.
We then met with Sylvia Ndzabe, a member of the Mabandla community who served as the secretary for the Trust and a Director of the Mabandla Development Company. She has recently been appointed by the Chairman of the Mabandla Devco to manage the silviculture and harvesting operations. She took us down to the eight-year-old eucalyptus compartment that her team was busy harvesting.
They are using a simple but effective motor-manual harvesting system. Four felling teams are felling, stripping and cross-cutting around 150 tons of timber per day. A stacking team collects the logs into neat five-ton stacks in-field. These are loaded onto a tractor-trailer bundle-loader and hauled to the depot about 1.5 kms away. This team is doing an average of 20 round-trips per day, which translates into 100 tons of timber delivered to the depot daily.
However, the majority of the timber only has to be hauled about 0.75 km to depot, which enables the tractor unit to complete 30 loads a day (150 tons a day). Andersons Transport has a contract to transport the timber to the mill.
Timber harvesting is something that these people have never done before, and there were some teething problems initially. However since Sylvia took over management of the operation a few months ago, productivity has improved significantly. She has introduced an incentive scheme that has also made a huge difference. Stackers were averaging less than two stacks per day each. With the incentive, they are now doing three stacks on a good day. Thus stackers can make R84 per day while chainsaw operators can make R90 a day.
The Mabandla estate has a total of 1 300 ha planted to gum and pine, and plans are to harvest 100 ha of Euc’s per annum. The gum is on a nine-year rotation, while the pine is intended for sawlogs.
The pine species planted include patula and eliottii, and the eucs are nitens, smithii and grandis x nitens clones which, according to Peter, have performed the best.
The Mabandla forestry operation provides jobs for around 70 people involved in harvesting and another 30 in silviculture and fire protection. These jobs are seasonal, and last for about eight months in the year. A core of eight to 10 people are employed full-time.
Peter Nixon and Themba Radebe, who have years of experience in forestry between them, have played a crucial role in the success of the projects. They provide on-the-job training and mentoring, and their technical expertise in forestry is invaluable. The contract that RFM has with the Mabandla Devco is to provide management and admin services, and the long term plan is that they will hand those functions over to the Devco when it is ready.
Building a relationship of trust between the RFM team and the various role players, including the community and the traditional chiefs for the areas, has been another key in the success of the projects. This has taken a lot of time and patience, and there have been frustrations along the way.
For instance, the long and protracted process of getting water use licences from the Department of Water Affairs and Forestry (DWAF), is a case in point.
“It took four years to get a planting permit for one of the projects,” remembers Peter. “Can you imagine how difficult it is to explain to a community why this process is taking so long when they are excited about a project and eager to get going?”
The project team planted small woodlots at each of the projects to demonstrate their bona fides and to try to take the heat off the communities’ rising expectations.
A more recent community afforestation project commenced negotiations in 2002 and the permit has only been approved this year – 6 years later!!
Effective and transparent financial administration is another cornerstone of the project, says Peter. He insists that all invoices must be signed by himself and a Devco chairman before it is paid. Accountability and transparency are built into the system.
These kinds of community projects come with their own unique challenges. One of these revolves around employment. There are many community members who want jobs, but there are only a limited number of jobs available if the projects are to run profitably. Recruitment and employment is handled by the Devco. When an employee is not performing his or her duties to the required standard, the process of replacing that person with a more suitable employee can be time consuming. This could result in the chief and his councillors getting involved to discuss the issue. In most cases the chairman and the trustee of the ward concerned handle the issue satisfactorily.
This is where the mediating role of the Trustees is important. They have to balance the interests of the individual with those of the community and the project. An element of trust and a sound understanding between the various roleplayers is crucial if effective decision-making is to take place.
Peter has experienced a few problems of this nature, but on the whole he is pleased with the progress they have made. A problem surrounding under-performance of a key employee in the Mabandla project was sorted out in this manner and productivity has since improved significantly.
“The caliber of the people involved with the project is so important,” said Peter. “If you’re working with good people you can make it work.”
Employees have been sent on appropriate training courses where possible to ensure they have the required skills. While SA Forestry magazine was visiting, Peter was busy organizing a one-day budgeting workshop for the managers and admin clerks on all three projects.
“We’re teaching them the proper way to run a forestry operation,” said Peter. That includes realistic budgeting, monitoring of costs and accurate cash flow forecasting.
Financing the community projects
Mondi was financing the projects in the initial stages, but after they withdrew Peter started working with the DLA to find the necessary finances.
Eventually start-up capital was accessed via the DLA’s Settlement and Land Acquisition Grant fund, in terms of which community members qualified for an RDP grant. In the case of the Mabandla project, 2 300 households contributed R4000 each out of their RDP grant into the Trust fund. In addition, Peter persuaded the Land Bank to extend a 20-year loan facility.
“We work on the 80/20 principle – 80% of our working capital comes from our capital and interest, and 20% from the Land Bank loan,” explained Peter.
The Mabandla Community Trust wishes to use the funds generated by the forestry to pay off the Land Bank loan, build some cash reserves and develop new businesses, thus creating more jobs that will benefit the community further.
One of the complicating factors surrounding these projects was the land rights issues. All the land is unsurveyed and is held by the government for use by the communities. It was originally part of the Eastern Cape where the government settled people in villages leaving open land for communal use. Thus it is different from Zululand, for instance, where households on tribal land have access to an adjacent plot for their own use.
Negotiations with the DLA are continuing in order to clarify the situation so that the projects can lease the land, or preferably take transfer of the land from Government.
“We need to get security of tenure so that we can focus on building and diversifying these projects,” said Peter.
“We’re felling our Eucs at eight years now, and in nine years from now we’ll be on a sustainable rotation of nine years,” said Peter. “At Mabandla we also have 400 ha of pine for saw timber, and there is a sawmill right next door, so that will be the cherry on top.”
At the moment the pulp timber prices are good, and the projects get a premium for delivering certain volumes and for their FSC accreditation.
They have a favourable supply agreement with Sappi in terms of which 40% of their Eucalyptus harvest is contracted to Sappi, who has the right of first refusal to the next 40%. The balance of 20% is unsecured – this means that they are free to shop around for the best prices they can get for that timber. This agreement provides security with flexibility to be able to benefit from the open market.
The infrastructure, legal structures and human resources capacity that has been built up for the forestry projects will be used as a platform for developing a range of diverse business enterprises for the benefit of the community. Projects that are being considered include commercial farming ventures, poultry, honey production, eco-tourism and the collection and sale of thatching grass.
The communities involved in these projects have a long-term vision that hinges on the success of the forestry enterprises. It is still early days, but the harvesting of the first timber from these plantations that were started from scratch is an encouraging sign for the future.
A healthy return on investment
Peter Nixon of Rural Forest Management, who is currently involved in the management of three community forestry projects in KZN, has done a simple calculation to show that an investment in a forestry project can, over 25 years, show an excellent return of 1500%. This calculation is not just a thumb-suck, it is based on a real project that is on track to deliver similar results:
- Government investment R 9 million
- Growers return over 25 years …
- Profit R 207 m
- Expenses R 90 m
- Balance of call account R 2 m
- Sub total R 119 m
- Wages R 16.5 m
- Total return R 135.5 m.
This is a 15 000% return on an initial investment of R9 million, and creates around 65 jobs per day.
Published in May/June 2008