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A small temporary nursery was formed as a depot for "heeling in " trees, so that the work can proceed without interruption whilst roads are unfit for carting. In regard to the condition of the trees, totara seem fairly well established, but so far their growth is somewhat slow, except in the most favoured places. At the same time, it may be said that many of the trees were planted as first-year seedlings, and they have survived rather trying conditions. Experience shows that it is necessary to line out the trees one year in the nursery before transferring them to the plantation. The cost of maintaining the trees is'from 10s. to 14s. per thousand, as the fern grows very fast all the year round. J The various Eucalypti have grown well, with the exception of E. oorymbosa and E corymocalyx, which are repeatedly cut down by frost. E. crebra and E. siderophlia do not succeed particularly well. The growth of the remaining species named is very satisfactory, and they now average 2 ft. m height, while specimens of E. rostrata and E. redunca have attained a Height of 9ft in two years. E. resinifera (the red mahogany) excels all others, although subjected to similar conditions, being firm, sturdy, and very hardy in its growth; it bears all the treatment of wrenching, mossing, and transplanting well, and appears quite at home in the Puhipuhi soil and climate. It is also known as the " Botany Bay gum." The timber is very durable and is used extensively in ship-building and wood-paving. There still remains a quantity of useful kauri timber lying about the reserve which might be profitably utilised. This timber is fast becoming scarce, and is consequently of more value and it is believed that at the present rate at which it is sold it would pay to convert these previously discarded logs by means of a portable sawmill. Owing to the low-lying land along the Kaimamaku Eiver being periodically flooded, it has not been planted, and as a matter of precaution the plantation-fence was erected well above the high-water mark. The area thus excluded is considerable, and is overrun at present by the settlers' stock. It is therefore desirable that this be leased for grazing, as the fences are liable to be damaged by cattle, and under a lease tenure the lessee would be required to subscribe towards the upkeep of the fences. As no record of rainfall and temperature was taken until September last, this information is of little value this season. Forward preparations are now in progress to receive this season's output of trees from Buatangata Nursery on a recently resumed area of 250 acres. Average number of men employed daily during the year, nine. Details of values and expenditure are appended. Chas. Hoopeb, Assistant Forester. L. J. Adams, Nurseryman in Charge,

Statement of Expenditure to the 31st March, 1906. Bweburn Nursery. £ s _ d Amount at the 31st March, 1905 ... ... ... 7 Q3O 13 11 Tree-growing ,' '" ' 312 9 g General maintenance ... ... ... ... 497 7 a Nursery-formation ... ... ... ... ... 34 16 6 Horse-shoeing and general repairs ... ... ... 85 16 2 Horse-feed ... .. ... .. 24 4 3 Tree-seeds ... ... ... ... ... 38 16 0 Tools, implements, &c. ... ... . . 2 4 3 Fuel and freight ... ... ... ... . 818 Buildings—stable and sizing-shed (new) ... ... 173 4 \ Supervision ... ... ... . . _ 18 5 0 £7,925 18 9 Tapanui Nursery. £ gr d _ Amount at the 31st March, 1905 ... ... 10 350 15 10 Tree-growing .' V[ ' 681 4 g General maintenance ... ... ... ... 351 j g Horse-shoeing and general repairs ... ... ... 27 6 5 Horse-feed purchased and grown ... ... 93 12 11 Manures ... ... ... ... ... .__ 768 Tree-seed. .'.'.' ['[ '" ?8 1Q 2 Tools, implements... ... ... 51 9 9 Buildings—sizing-shed and part Nurseryman's cottage ... ... 186 12 0 Miscellaneous works ... ... . 128 Supervision ... ... ... >ti 38 11 0 £11,867 13 4

5—C. Ib.