C.—3.

REPORT.

SUMMARY. Following the practice of past years, the following brief review of the main activities of the Service is published for general information and easy reference by the busy reader. In most cases the subjects mentioned are dealt with in greater detail in the pages which follow. Afforestation. —The total area of exotic State forests is now (in round figures) 428,200 acres. At Rotoehu, the new afforestation unit in the Bay of Plenty district, much preliminary work was necessary before tree-planting of any magnitude could be economically commenced, but nevertheless 237 acres were planted with stock raised in the Canterbury Conservancy. Tobacco-culture, originally started under the supervision of the Department of Agriculture as a relief measure during the depression years, has been practised at the Station for the past six years, and when an afforestation project was decided upon the control of all operations was transferred to this Service. Although final figures are not yet available, it is confidently anticipated that last season's harvest will produce 35,000 lb. of high-grade cured leaf, for which a ready market exists. This Service gratefully acknowledges the valuable assistance it received from several expert Government officials, and particularly those of the Department of Agriculture, in preparing the leaf —i.e., harvesting, curing, grading, &c. Timber Sales.—The demand for blocks of milling-timber remained keen throughout the greater part of the year, but in some regions a falling-off was noticed in the last few months, and this accounts for the final figures being slightly lower than last year. The volume of timber sold was 103,341,000 board feet, with a stumpage value of £107,866. Production of Timber.—The timber produced from all sources is expected to approximate 330,000,000 board feet. Last year's estimate of a similar quantity was not realized, final figures being some few million less. The total cut from State forests under all heads was 113,000,000 board feet, a slight increase on the total for the previous year. Sawmills. —The recorded number of sawmills under all heads at the close of the year was 598, or four more than those for the year 1936-37. Of this total, 318, or 67 per cent., were operating full time, while 111 were closed, and 169 worked part time only. Sawmills cutting in State forests numbered 144, as against 138 last year. Imports and Exports of Timber.—Schedules showing imports and exports of timber for the pastthree calendar years will be found in Chapter IV of the report. Prior to 1931 imports greatly exceeded exports, but during the following five years the position became reversed. Since 1936, however, whilst imports have again exceeded exports, it should be pointed out that more than 60 per cent, of the former comprised Australian hardwoods for railway-sleepers, poles, bridge-building, cross-arms, &c., and such timbers do not compete to any great extent with New Zealand timbers. Since 1931 the competitive imports have amounted to only 5 per cent, of the native-timber production. The marked falling-off in exports apparent during the last three years is due, of course, to the restrictions placed on white-pine, which may only be exported when current production exceeds local consumption. Hopes of finding a steadily increasing market in Australia for o.b. matai, which is difficult to sell in the Dominion, and for rimu appear very bright, so that next year a rise in exports may be predicted with some confidence. Opossum-trapping.—The procedure outlined in last year's report for dealing with those who wished to trap opossums—i.e., the allotting of blocks annually for one season only—was again followed for the year under review. Two hundred and sixty-three permits were issued to trappers to enter State forests, or seventy-one less than last year. This system of allotting blocks by public competition has worked with a minimum of friction and is undoubtedly the best method in the interests of all concerned. A close season was observed in North Canterbury Acclimatization District during the 1937 season, and it is understood that a close season throughout the Dominion will obtain for 1938. Mining Privileges.—Applications for mining privileges continue to decline ; 535 were dealt with, as compared with over 1,000 two years ago. Of the number first mentioned, only 25 per cent! affected State forests. General.—l desire once again to record my supreme satisfaction with the work of officers of all ranks during the year of strenuous endeavour which has just closed ; the results recorded herein are due in no small measure to the loyal, competent, and energetic assistance accorded to me on every occasion,

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