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Sunday 26 June 2016

Non-Wood Forest Products in Asia - Nepal

Author 
Deep Bahadur Khatri
Deputy Director-General
Department of Forests


Report from FAO REPORT, 26 June 2016 

Introduction

Nepal, situated between India and China, has an area of about 14.7 million hectares and lies at 80° 04' to 88° 12' E and 26° 22' to 30° 27'N. The country is rectangular in shape, extending from east to west. Within a north-south horizontal distance of about 150 kilometers, there is a climatic range from the sub-tropics of the Terai in the south to the upper tree limit and perennial snow of the Himalayan mountains in the north. Rugged hills and mountains cover more than 80 percent of the land. In the south, there is a belt of almost level land, 20 to 45 kilometers wide, known as the Terai, which is an extension of the Gangetic plain of India.

Nepal can be divided into five parallel physiographic zones running east to west: the Terai, Siwaliks, Middle mountains, High mountains, and High Himal. They occupy respectively 14, 13, 30, 20 and 23 percent of the total land area. Administratively, the country is divided into five development regions and 75 districts.

With its great range of altitudes, temperatures, and rainfall, and its position at the confluence of different floristic regions, Nepal has a rich flora. The number of ecosystems per unit area is probably greater than in any other country in the world. The distribution of vegetation generally follows the attitudinal zones.

The country's land use is categorized as follows:

· cultivated lands (21 percent)
· non-cultivated inclusions (7 percent)
· grasslands (12 percent)
· forested lands/plantations (37 percent)
· shrub lands/degraded forest (5 percent)
· other lands (18 percent)

In mid-1986, Nepal's population was estimated at 17.1 million. The medium-variant projection of the Central Bureau of Statistics puts the population at 23.6 million by the year 2001, which means an average annual growth rate of 2.2 percent.

A livestock survey conducted by the Department of Food and Agricultural Marketing Services puts the 1985 livestock population of the country at 6.4 million head of cattle, 2.8 million buffaloes, 8 million sheep and 4.9 million goats or an equivalent of 7.8 million livestock units (LU). The livestock population is expected to reach 11.6 million LU by 2001.

Development of the country is severely limited by its extreme range of topography and climate, especially in the geologically unstable and environmentally fragile mountain zones. More than 90 percent of the people rely on agriculture for their livelihood.

Industries, which contribute about 10 percent to the gross national product, provide employment to about 6 percent of the population. The current per capita annual income is estimated at US$ 160.
Biomass, including fuelwood, agricultural residues and animal dung, is the major energy source in Nepal, providing 94 percent of the total energy consumption.

Heavy pressure is being exerted on the forests of Nepal by the increasing population of both humans and livestock. As a result of this pressure, the forests have been reduced in area and are becoming increasingly degraded. As a consequence, the environmental quality of Nepal is deteriorating, and it has become increasingly difficult for people to find essential forest products. A vicious cycle is operating, where intensified pressure on forests creates environmental deterioration, which in turn leads to scarcity of forest products and further pressure on existing forests.

In early 1986, His Majesty's Government, put into operation the Master Plan for the Forestry Sector Project (MPFSP) to rationalize the forestry sector. MPFSP was co-financed by the Asian Development Bank and the Finnish International Development Agency. MPSFSP was charged with the formulation of a 25-year master plan for developing the forestry sector of Nepal.

The information and data for this country status paper on non-wood forest products in Nepal has been extracted from various MPFSP documents and reports.

Important non-wood forest products: Production and value

Non-wood forest products, also called "minor" forest products by classical definition, are all forest products other than timber and fuelwood. In Nepal, fodder is not regarded as a minor forest product, being one of the main products of the forests. Subsistence farmers make up more than 90 percent of the population of Nepal and rely on livestock for their agriculture-based livelihood. Fodder for livestock is as important to a subsistence farmer as any other forest commodity. Fodder is thus a "major" forest product in Nepal and therefore not included in descriptions and analyses of non-wood forest products in Nepal.

The significant NWFPs in Nepal are medicinal and aromatic plants, loktapaper, pine resin, Sal seed, katha, sabai grass, bamboo and cane.

Medicinal and aromatic plants
There are about 700 species of medicinal and aromatic plants in Nepal, about 12 percent of the country's vascular flora. They are distributed in all ecological zones of the country, but a greater concentration occurs in the tropical and sub-tropical zones.

Collecting of medicinal and aromatic plants has been going on in Nepal since time immemorial. A small portion of the plants collected is used locally in the treatment of diseases, but about 90 percent are sold as crude herbs, mainly for export. The trade in crude herbs goes through four tiers: collectors, local dealers, big dealers and international trading houses.

The poor people of the hills and mountains of Nepal depend upon medicinal plants for their health care in accordance with their cultural heritage and traditional practices. Domestically, primarily in auyervedic preparations, the value of herbs was estimated at Rs600,000 in 1986.

Lokta for hand-made paper
Daphne spp., locally known as "lokta," has been used as raw material for hand-made paper for a long time. It is the basis for an expanding cottage industry with an annual turnover of around Rs10 million. The industry provides direct employment for about 1,500 families, some of them the poorest of the poor, living in remote, backward areas.
The growing stock of lokta was estimated at about 100,000 tons in 1984. Not all of the growing stock is harvestable, as the bulk of it grows in remote and difficult to access areas.

Resin and turpentine
Resin has been tapped from pine trees for several decades in Nepal, and has great economic significance. It provides raw materials for domestic use and for the rosin and turpentine industries recently established in the country. Oleoresin gums are obtained from the native chir pine (Pinus roxburghiiand blue pine (Pinus wallichina). Only chir pine can be tapped economically, yielding about 3 to 5 kilograms annually per tree. Blue pine, which occurs at higher altitudes yields only about 1 kilogram annually per tree and is therefore usually not profitable to tap.

The estimated potential production of pine resin in Nepal is 21,700 tons per year on a sustained-yield basis. Too little is known about the real production capacity of Nepalese pine forests. A revised and well-studied assessment of the resource is needed, to be followed by a sound management plan.
Rosin and its derivatives are used in paper making, sizing, boot polish, adhesives, paints, printing inks, surface coatings, varnishes, textiles, rubber making, soap making, the tire industry, the sporting goods industry, and many others. Local production has provided much needed income to collectors in rural areas, and reduced the need to import rosin and turpentine. The primary producers on average receive Rs2 per kilogram, which is only about 10 percent of the total product value.

Sal seed oil
Aside from being a major source of building timber, sal (Shorea robustais a prolific producer of seeds. Sal seed has a high oil content and the oil extracted from it has many industrial and household uses.

The actual authorized and unauthorized collection is only about 41,000 tons per year, only 6 percent of the potential, based on the Indian yields. Sal seed is collected in Nepal by four oil industries which receive quotas for monopoly collection in specific areas. Most industries collect through a network of small contractors who bring the pods in tins. Each tin usually contains about 10 to 12 kilograms of pods and the collectors are paid Rs3 to 3.50 per tin (about Rs0.40 to 0.50 per kilogram). Each tin of pods yields about 7 kilogram of seeds (about 62 percent of actual pod weight).
A comprehensive study related to collection, processing, and marketing is needed.

Katha and Cutch
Katha is an extract derived from the hardwood of khair (Acacia catechuby boiling. It is a clay-colored crystalline substance used in the preparation of "pan," a chewing material popular in Asia and East Africa.

Cutch, a by-product of katha production is a black reddish gum resin which is used in tanning, dyeing and as a lubricant in oil-well drilling. It is also traditionally used for making medicines.
The future of the country's six katha plants will depend on the availability of khair, a rapidly vanishing riverine tree. The sustainable annual yield of khair from Terai forests has declined from 26,000m3 in 1979 to about 8,400m3 in 1988, while the total annual quota of the six plants is almost 38,000m3.

The market for most of Nepal's katha is Kanpur, India where the price of katha varies from Rs80 to Rs250 per kilogram and the price of cutch varies from Rs6 to Rs13 per kilogram. The price of adulterated katha in Delhi can be as low as Rs26 per kilogram.

Sabai Grass
Sabai grass (Eulaliopsis binatais traditionally used in rope making and thatching. For paper making, sabai is reputed to be superior to most other available grasses. In India it has been used for paper making since 1870.

Although industrial paper making in Nepal is new, small paper mills have been operating since 1986. These paper mills have been designed to take sabai grass and straw as raw material. These mills have a combined capacity of about 70 tons per day.
A country-wide data base on annual production of sabai grass does not exist. Based on studies carried out in a few districts, the quantity which may be available for commercial purposes in the Terai and Siwaliks could be about 300,000 tons of air dried material per annum.

The Forest Survey and Research Office has estimated the cost of sabai grass for the Nepal Paper Industries Ltd. at Rs1.71 per kilogram. This was made up of Rs1.00 to collectors, Rs0.36 for transport to depot and Rs35 for transport from depot to factory.
Rope-making machines have been widely introduced in some villages bordering India and it is estimated that nearly 75 percent of the sabai grass being harvested for this purpose. There are ready buyers from India who will pay Rs31.00 for 5 kilograms of rope.

Bamboo and cane
Bamboo and cane are used extensively by Nepalese for fodder, to make traditional baskets, mats and furniture, and for building in rural areas. The habitat of commercially exploitable bamboo and cane has been reduced to the brink of disappearance.

There are still few scientific data on the identification, distribution, uses, and development prospects of bamboo, although this multiple-use plant is an integral part of Nepalese life.

Exports of NWFPs

Data on Nepal's NWFP trade vary considerably from one source to the next. According to Trade Promotion Center figures, Nepal annually exports more than 90 percent of its crude drug harvest, which was worth Rs16.5 million in 1986-87. A 1986 FAO estimate shows that the annual export of medicinal and aromatic plants totals more than 1,000 ton worth approximately Rs 31 million, but the data sources are not known. Data obtained from the Foreign Trade Statistics of the Department of Customs, Ministry of Finance, show that 6,263 tons of medicinal plants were exported in 1985-86, worth Rs78 million. Ministry of Finance data show a significant decline in exports in 1986-87, however, to only 361 tons, valued Rs17 million. This decline is due to the imposition of a ban on the export of crude drugs in 1986. It is suspected, however, that a large volume of crude drugs are still be exported unofficially, especially to India.

Exporting large quantities of medicinal plants and crude drugs are not possible because regeneration cannot occur fast enough. The export of medicinal and aromatic plants has diminished during the last decade and product quality has declined. The uneven and often poor quality of the products is another reason.

Hand-made paper from lokta is used for a variety of purposes, from legal documentation to record-keeping papers, religious scriptures, file folders, envelopes, greeting cards, and calendars. The total domestic consumption as office paper comes to about 7.4 million sheets annually, or about 185 tons. Other end-users consume the remaining 115 tons. Handmade paper is only exported in small quantities. From 1981 to 1985, UNICEF purchased about 1.6 million sheets for greeting cards. The value of exports of hand-made paper has varied between Rs0.2 million and Rs1.2 million between 1982 and 1986.

There is no significant export of rosin and its derivatives from Nepal. Whatever is tapped is used domestically. If the paper industry grows according to the projected demand for printing and writing papers up to 21,700 tons per year, 945 tons of rosin derivatives would be required. If the other resin-consuming industries grow at an annual rate of 5 percent, they will consume 2,900 tons of resin derivatives. Thus the Nepalese consumption of rosin and its derivatives could increase to about 4,000 tons by the year 2010. This means that if the rosin industries expanded to the full capacity that could be sustained by the resource base, there should still be about 1,900 tons of rosin and over 2,550 tons of turpentine available for export. The markets for these volumes must be found in nearby countries. In the world market, resin products are readily available from big pulp mills which produce them as by products without raw material collecting costs.

Four of the seven oil extraction plants in the country have agreements with the Department of Forests to procure 26,000 tons of sal seed annually. Industry sources claim that 2 million person-days are employed in the harvest season and that Rs15 million are paid to the collectors. Sal fat is used as a partial substitute for cocoa butter in Japan, West Germany, Switzerland and Italy. Large quantities of sal fat, either crude, neutralized or dry fractioned, have been exported to the United Kingdom, Japan and some other countries since 1970. Studies documenting export quantities and their values have not been carried out.

According to the Trade Promotion Center and Department of Customs, the production of katha and cutch has fluctuated between 1,100 and 1,700 tons per year between 1980 and 1985. In 1983-84 Nepal exported 1,591 tons of katha and cutch, mainly to India, worth Rs60.6 million. Total export value may still remain about the same because rising prices have compensated for decreasing quantities.

Although the Indian paper industries have been using Nepal's sabai grass for a long time, after the establishment of paper industries in Nepal the Indian industries have been discouraged from purchasing Nepalese sabai. Thus there is now no significant export of sabai.

Bamboo and cane are used traditionally in Nepal. At present there is no significant export of bamboo from Nepal. A long-term development program under the Ministry of Industries has been proposed to provide raw materials for cottage industries and to contribute to the basic needs policy of HMGN.

Collection and processing of NWFPs

In general, non-wood forest products are an unorganized part of the economy in which the primary producers are at the mercy of the traders. The price paid to the primary producers has no relation to the wholesale price at the terminal market. The share of the primary producer may be as little as 25 percent of the terminal wholesale price, although in most cases only transport costs are involved, and there is no additional processing. Only a few products, including sal seed, resin, sabai grass, and khair are linked to processing industries in Nepal. There is no monitoring system nor government intervention agency which could ensure a more equitable price to the primary producer.

There is no development plan for non-wood forest products in Nepal as a whole, and there is no special agency dealing with them. Medicinal and aromatic herbs are a notable exception, but even in this area little has been done to organize or regulate the collection of plant materials from the forests.
The entire sub-sector of non-wood forest products, has not received the benefit of an integrated development approach. The economic plight of the primary producers, conservation of the ecosystems that constitute the resource base, management plans for regulated extraction, and improvements in trading and processing all need to be considered as parts of the whole system.
Lokta is the only NWFP for which an effort has been made to provide a better price to the primary producers, to regulate harvesting for sustained yield, to introduce better technology for procurement and to add further downstream value by secondary industries. Most of these activities have come as a result of UNICEF initiatives.

With the exception of medicinal and aromatic plants and lokta, there has been no assessment of the resource base, even for important NWFPs. No studies have been made on the collection and trading.

Employment and social benefits from NWFPs

For most minor forest products, private-sector trade and the law of supply-and-demand controls the price and market network. The system is a traditional one, based on traders financing the collectors during lean periods. The traders buy everything the collectors bring, as they know the terminal markets and the current prices. The collectors want both to earn cash and to purchase essential commodities. The traders commonly supply collectors these goods in advance, on credit, and thereby gain a hold over them.

Various agencies of the government seem to be unaware of the predicament of the primary producers or collectors. Collectors get Rs0.60 per kilogram for sal seeds, for example, while their counter-parts in India, some 300 kilometers away, receive three times as much. Resin tappers get Rs1.50 to Rs2.00 per kilogram, which again is about one third of the rate paid in India. Sabai grass collectors get Rs0.40 per kilogram when they sell for delivery to the Bhrikuti Paper Mills in Nepal. The factory rate price at the Bhrikuti Paper Mills, however, is supposed to be Rs1.25 per kilogram.

Future directions to promote NWFP

The Master Plan for Forestry Sector Project (MPFSP) has formulated basic objectives for the development of the minor forest products sub-sector. These are:

· to increase the supply of essential commodities like drugs derived from medicinal and aromatic plants;· to provide opportunities for the rural people to earn income;
· to gradually shift from dispersed collection to plantations and to systematic resource management; and
· to add value to the products through processing so that a part of the benefit flows back to the primary producer, and so that the entire country may benefit in economic terms.
It is recognized that at the operational level, there must be a correct inventory and evaluation of resources, and there must be a management plan to harvest these resources on a sustained-yield basis. It is also recognized that it is necessary to build up organizational structures (intervention and operational agencies) which can assist the private sector in developing production and processing systems, and guarantee that a fair share of the benefit goes to primary producers.

Criteria have been established to identity priority NWFPs for development. Criteria have also been set for the selection of new commodities that have importance to the national economy and will provide income to the collectors.

A phased development program for the sub-sector has been proposed. The program is based on a common plan for developing production, processing, and marketing systems for medicinal and aromatic plants and other minor forest products and strengthening institutional support including policy reform, resource assessment, research and development, and extension.

For further details log on website :
http://www.fao.org/docrep/x5334e/x5334e07.htm#TopOfPage

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