Availability of plantation trees

IBISWorld expects the availability of plantation area to grow by 1.0% in 2026-27, to total 1.86 million hectares. This rise represents the steady upward trend established since 2020-21. The growth of net stocked forest area is expected to be driven by sustained new planting. Carbon credit (NZU) prices have recovered from their late 2025 and February 2026 lows, as the Climate Change Commission's April 2026 report signalled continued government operation of the emissions trading scheme (ETS). Domestic timber prices are also expected to rise amid a recovery in the construction market. The uptick in NZU and timber prices will likely support planting activity and the availability of plantation trees in 2026-27.

Natural disasters have weighed on the availability of plantation trees over the past five years. Cyclone Gabrielle in February 2023 caused considerable damage to apple orchards in the Hawke's Bay and Gisborne regions. While this specifically affected fruit trees, it highlights the vulnerability of plantation areas to extreme weather events. Increasing competition for land usage and changing land management practices have also offset the expansion in net stocked forest area over the past five years. As urbanisation expands, agricultural land is often converted into residential or commercial developments, limiting the space available for new plantations. Also, economic pressures lead landowners to prioritise short-term profit from alternative crops rather than committing to long-term forestry investments, which can take years to yield results.

A series of government programmes has altered trends in the availability of plantation forests. Forestry New Zealand (Te Uru Rakau) implemented the One Billion Trees Programme in 2018. The One Billion Trees Programme aimed to plant one billion trees by 2028 and is designed to create better social, environmental and economic outcomes for New Zealand. The initiative aims to support increased planting of permanent trees and plantation forests by offering grants, partnership projects and joint ventures. The New Zealand Government seeks to use its comparative advantage in production forests to develop wood and wood-based products as a viable replacement for petrochemicals. This trend has made the availability of plantation forests an increasingly central plank in the New Zealand Government's plans to reduce carbon emissions. Through these government initiatives, landowners have sought to establish and manage forests to increase carbon storage. These initiatives have contributed to a recent upturn in the availability of plantation trees since 2020-21, with 492 approved projects as of January 2026. However, the wind-down of the One Billion Trees grant programme, which is already closed to new applications and will only deliver approved contracts until 2028, does not act as a meaningful driver of new planting moving forwards. Overall, the availability of plantation area is forecast to rise marginally at a compound annual rate of 1.2% over the five years through 2026-27.