Chapter 6(7?)

Question 1

Q1. What is your understanding of a SWOT and how would you feel it would benefit
you in your decision making

Answer 1

A SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) is a strategic tool used to evaluate the internal and external factors that could influence a business or project. In the context of Irish farm forestry, this framework helps farmers and landowners assess their forestry operations more effectively and make informed decisions.

Here’s how a SWOT analysis would apply to Irish farm forestry:

1. Strengths• Natural Resources: Ireland’s climate is ideal for certain types of trees, such as Sitka spruce, which grow well in the temperate, wet environment.
   • Biodiversity: Forestry can enhance biodiversity on the farm by creating habitats for wildlife.
   • Government Support: There are strong financial incentives and grants for farmers to engage in forestry in Ireland, including afforestation schemes.
   • Sustainability: Forestry can increase the long-term sustainability of the farm by creating a diversified income stream, sequestering carbon, and improving soil quality.
2. Weaknesses• Long-Term Investment: Trees take many years to mature, meaning income from timber can take decades to materialize. This may be a challenge for farmers who need quicker returns.
   • Complex Regulations: Navigating the regulations around forestry can be difficult for farmers who may not be familiar with forestry management practices and legislation.
   • **Land Use

Question 2

Q2. With your desired planting FT scheme – what are the premium rates and
establishment rates that one would achieve with a successful planting scheme?
(Ref to the grant table rates for your decision making) (2 marks)

Answer 2

Student interpretation answer

Question 3

Q3. What would be your estimate rate of return on investment if you planted your
desired FT scheme?

Answer 3

Student interpretation answer

Question 4

Q4. What is meant by N.P.V?

Answer 4

Net Present Value

Question 5

Q5. In forestry – The forest site description is important, so what would this include for
example – soil
Name 2 others? (2 marks)

Answer 5

Drainage, elevation, exposure, previous management

Question 6

Q6. The potential forest returns on a hectare bases are attractive when stacked against
other farm enterprises, what are the main factors that would help realise a financial
return

Answer 6

Thinning and clear-fell

Question 7

Q7. What does AEV stand for?

Answer 7

Annualised Equivalent Value

Question 8

Q8. Income tax from commercial forestry is currently exempt from tax liability TRUE
OR FALSE?

Answer 8

True

Question 9

Q9. Commercial forests that are occupied by individuals are exempt from capital gains
tax on growing timber – what is not exempt?

Answer 9

The underlying land is not exempt

Question 10

Q10 Forestry grants are treated as income TRUE OR FALSE?

Answer 10

False