The current distribution and likely future expansion of eucalypt plantations in southern China are described in this paper. As the demand for wood and paper will increase strongly in the next 10 years, the market for eucalypt wood in China is very optimistic. The key question for the expansion of eucalypt plantations in southern China is whether the price of the eucalypt wood produced locally is competitive internationally. Scenarios and economic analysis of different plantation establishment and management regimes are also included in this paper. It is concluded that site selection, fertilisation and weed control are the key factors that affect the economic benefit from commercial eucalypt plantation investment. It is predicted that 30% of productivity of eucalypt plantations in southern China will be from genetic improvement, and 70% will be from plantation establishment and management. Tax cuts in the near future will make most of the well-managed eucalypt plantations in southern China profitable. Research needs for commercial eucalypt plantations are also discussed in this paper.
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