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BEPOET. Sir, — Department of Lands and Survey, Wellington, Ist May, 1916. I have the honour to forward herewith the annual report of the Forestry Branch of (his Department. The matters of chief interest in connection with last year's operations and future proposals may be summarized as follows : — Trees raised and Area planted. During the year ending on the 31st March, 9,122,000 trees were raised at the four Slate nurseries. During the same period 5,485,450 trees were senl out to the various State plantations and 410,050 to outside places. In the six plantations in which there was still planting-land available- a total area of 2,677 acres was planted. This is the largest area yet planted in one year. Prison Labour. No work was done by prison labour in (he Soutli Island. At Rotorua the average number of prisoners employed was 34*61, being rather larger (ban during the previous year; but work could have been found for more men had they been obtainable. The total value of the work done at Rotorua by prison labour during the last twelve months was £3,502 Bs. 3d.", which brings the total value of tree-planting work done (since 1904-5) in the North Island by prisoners to £4-1,366 12s. Expenditure. The expenditure for the year was £30,413. Of this £8,000 was derived from the Consolidated Fund, £1,000 from ihe vote for State assistance in tree-planting by farmers, and the balance of £21,4-13 from the sales of timber. Weather-conditions . The weather experienced in both Islands during spring and summer was drier than even in the previous year, and at some of the stations there were considerable losses with the young trees. State Assistance to Farmers in Tree-planting. The Government's proposal to assist farmers in tree-planting was authorized by section 69 PJk of the Reserves and other Lands Disposal and Public Bodies Empowering Act, 1915, and the sum of £1,000 was voted by Parliament to cover expenses in connection with raising and supplying the trees. Price-lists, application-forms, and regulations governing (he matter have been issued for general information. Though the scheme was not put into operation until late in (lie season. 285,539 trees were distributed to 128 applicants, from whom £535 17s. 6d. was received to cover tho cost of raising the trees and delivering them to the nearest railway-station. When the advantages of the scheme become fully known it is expected that a very large number of farmers will apply for trees. In addition to the great value on farms of shelter plantations, the increasing scarcity and enhanced prices of fencing and firewood timber are every year making ii more necessary for fanners to plant trees to produce these requisites. It is not, of course, expected that the planting of trees by farmers for farm purposes will add appreciably to the supply of timber that will Ik- required for building and construction purposes. This supply, if we .-ire not to be dependent on foreign countries, must be provided by the State, and possibly to some extent by public bodies, who may find it an advantage to grow timber - trees on water-catchment areas. Plantation Ti-iinninos and Preservative Treatment. It is satisfactory to report that a fair market was found for thinnings from the larch plantations at Rotorua, whilst at Hanmer thinnings from a. Monterey pine plantation were satisfactorily disposed of. Owing to the present comparative abundance of native timbers suitable for miningprops and sleepers, and the extremely easy terms on which these timbers can be obtained from State lands, the mining companies are generally disinclined to take larch thinnings. The supply of suitable native timbers is, however, fast decreasing, and il probably will not be long before thinnings from the.plantations will be much sought for by the companies. Thinnings from pine plantations (being all sapwood), however, will not be suitable for mining or fencing purposes, and to make them suitable they will have to be treated by one of (lie antiseptic processes that have been fully tested in Europe and America. So far in all countries impregnation with ereasote lias been proved the most efficacious of all preservative methods of treatment, and, as the enhanced price of this material in Europe and America prohibits its profitable use in this country, il may be advisable that a bonus should be offered for its manufacture in this Dominion.