Skip to main content

Strong investment returns have driven a boom in forestry investments in recent years

Mr Grainger says the new rush of investors are primarily from Asia, Europe and North America and they have been attracted by not only the strong investment returns, but favorable policies on encouraging sustainability that has reinvigorated the interest in the sector.

Forestry in New Zealand has been dominated by long standing industry players, some 30 parties controlling 70% of the productive forestry.

"What's changed is the entrance of a new wave of investors at a similar scale. We're seeing more big timber funds and private family companies looking at the market, many of which have not been active before."

Mr Grainger says that the new players are not only attracted by strong returns but the relative safety and low management costs the asset class offers.

"Log prices have been undergoing steady growth in the past decade. Export prices have grown from $121 to $165 per cubic meter a decade ago, to $176 to $222 as of March this year."

Mr Grainger also states that with the government supporting continued investment into forestry, there is good reason to remain optimistic about forestry's fundamentals.

With the New Overseas Investment Office legislation going through, Parliament will allow overseas investors to invest with growing confidence

"What we are seeing globally is a push towards more environmentally sustainable products being used, and wood is certainly at the forefront of that. So, I think overall, it's looking very positive for the wood product sector."

The sector also generated more than $3.5b for New Zealand's GDP – two fifths of which came directly from forestry and logging. New Zealand has 1.7m hectares of plantation forest, compared with 10.8m hectares of pasture and arable land.

Read more: http://www.digitaljournal.com/pr/3921745#ixzz5QE9PdsKX

To see more visit www.ecocropsinternational.com
You can follow us on Flickr, Twitter and Linkedin
Labels:

Comments

Post a Comment

Popular posts from this blog

Why Goldman Sachs thinks the Bull Market will continue

The World Stock Markets have nosedive over the past two weeks and has sparked concerns among many investors that a long-feared bear market might finally have begun.  The S&P 500 index is 7% below the all-time high. Goldman,  says the firm is confident that the bull market remains intact even despite the recent sell-off across the global markets.  5 Reasons Goldman Is now Bullish:  S&P 500 EPS is predicted to rise to 21% year-over-year in the third quarter.  Economic expansion is still in a mid-cycle.  Corporate return on equity is rising and at a high for this bull market.  Only 37% chance of a recession in the next 3 years according to Goldman's Economists  Return on Equity is rising  Concern For Investors A big concern for the bears of the investment world this year has been stock valuations that seem to be stretched. Goldman counters that rapid earnings growth has fueled only minor increases in stock prices this...
Post a Comment
Read more

Trumps biomass policy

In 2007 the USA Federal Government passed the US Renewable Fuel Standard which required ethanol blending with domestic oil in large quantities with frequent increases in amounts of ethanol being used.  The bill was passed to reduce the USA carbon footprint and increase the amount of renewable biofuel being used in the USA. Under the Trump administrations, they have been far less supportive of the biomass blending mandate, granting biofuel waivers to major industry players and allowing the trading of biomass credits to develop. Despite the less than active support for biofuel domestically Trump has been pushing his trade negotiators to get big concessions from his Chinese counterparts by asking them to lower their tariffs on biomass in particular biofuel. China's ethanol demand is expected to grow nearly sevenfold as the country prepares to introduce E10 fuel throughout the country next year. E10 fuel is a fuel using 10% ethanol and 90% petrol. U.S. trade negotiato...
Post a Comment
Read more

Eqtec signs MoU with Phoenix Biomass Energy worth about €10m

EcoCrops International reports that a Technology solution company Eqtec said on Monday it had signed a memorandum of understanding, with Phoenix Biomass Energy, a USA company located in California.  Phoenix Biomass Energy a power company, to supply the company's proprietary Eqtec Gasifier Technology for two power plants in California, USA. The two contacts to be signed are collectively are expected to be valued in the regions of €10m The Financial close is expected in the last fourth quarter of 2018 and the purchase contracts are expected to be signed and executed shortly after that Eqtec reported. Under the terms of the contact, Eqtec was the exclusive technology supplier of a 2MWe gasification plant and a 3MWe gasification plant to Phoenix for the 12 months from the date of the memorandum of understanding. 'We are delighted to be the exclusive supplier of technology to Phoenix Energy. The USA is a key country for waste to gasification technology and we are excited to ...
Post a Comment
Read more