Steadily rising prices for timber on Mindanao in the Philippines have given an incentive to farmers to devote some of their land to fast-growing tree species. The costs and benefits of intercropping young timber trees with food crops was studied in a 1000 stem ha stand of Paraserianthes falcataria. At 2 years of age, diameter at breast height and height of inter-cropped trees were 33 and 21% greater, respectively, than sole trees. Management costs of intercropped trees were less than half of sole trees. Allometric equations for Mindanao falca-taria were used to project future tree growth and system returns. In the base scenario (1000 trees haÿ1, 5-year rotation), the sum of biophysical and economic bene®ts of intercropping trees with a maize/vegetable rotation for two years were less than the costs of reduced intercrop yield, compared to sole cropping of each component. A linear relationship of crop decline to the increase in basal area of the stand was used to predict returns to intercropping under alternative tree densities and intercropping periods. Intercropping becomes more attractive as labor becomes scarcer relative to land, the need to minimize cash inputs becomes more important to farmers, and trees increase in value relative to annual crops.
