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  • Archive for January, 2017

    Myanmar govt launches forestry scheme

    2017 - 01.31

    Myanmar has unveiled a multi-million-pound scheme to help protect its woodlands and forests in what represents positive news for people interested in forestry investment.

    The government’s Ministry of Resources and Environmental Conservation said the US$5.5 million United Nations Reducing Emissions from Deforestation and Forest Degradation (REDD) programme would help it tackle deforestation. Myanmar ranks third globally for forestry depletion.

    The launch of the new scheme took place at the Thingaha Hotel in Nay Pyi Taw and was attended by Ohn Win, Myanmar’s minister of resources.

    Running until 2020, the programme will promote organisations working to protect woodland and the sustainable development of forests. It is being partly funded by Norway.

    “In Myanmar, 44 per cent of land was covered by forests. Our forests play a vital role in the reduction of climate change and this programme will help protect existing forests and upgrade low-quality forests,” said the government’s Ohn Myint.

    The Forestry Department says between 1.2 per cent and 2 per cent of forest has been lost each year over the last 15 years.

    The REDD programme is run by the UN Food and Agriculture Programme, the UN Development Programme and UN Environment Programme.

    New grants released to create woodland

    2017 - 01.30

    The Forestry Commission has launched a new grant scheme to help fund the development of new woodlands across the country.

    In positive news for people interested in woodland and forestry investment, the Woodland Carbon Fund will support the planting of multipurpose woodlands over 30 hectares in size, providing opportunities to work in partnership at a landscape scale and to improve public access to woodland.

    The funding pot, which is now open for applications, offers a maximum grant rate of £6,800 per hectare or £8,500 per hectare for areas around urban fringes and for those who provide permissive access to the public.

    Darren East, senior forestry manager for Savills across the north of England, said: “The Woodland Carbon Fund is a demand-led grant scheme which has been designed to boost the rate of woodland creation in England, whilst also demonstrating how woodland creation can help to meet the government’s future carbon targets.

    “There is no set closing date and this will be very much dependent on uptake so we would advise landowners to apply for this grant funding at the earliest opportunity.

    “This particular scheme will run alongside the existing Countryside Stewardship Woodland Creation Grant but will be steered towards larger scale woodland creation with an emphasis on commercially productive species and public access.”

    Private investment in natural world reaches $8.2bn

    2017 - 01.25

    The amount of privately-held cash being put into conservation projects reached $8.2 billion between 2004 and 2015 amid “growing recognition” that forests represent a smart investment.

    Research by Forest Trends shows that the amount of private capital invested into the natural world grew a whopping 62 per cent in just two years, from 2013 to 2015.

    Forest Trends’ Ecosystem Marketplace report, which polled 128 banks, companies, fund managers, family offices and non-governmental organisations, found that a “significant amount of investment” is moving into emerging economies, particularly sustainable forestry in Latin America, including Brazil.

    Annual investments in new economies quadrupled to over $500M between 2009 and 2015.

    The private sector is seeing environmental benefits as well as significant financial returns from investing in forests and other natural spaces as ‘conservation investing’ becomes more popular, Forest Trends said.

    Among the report’s key findings include:

    • Conservation investing experienced dramatic growth after 2013, as total committed private capital climbed 62 per cent in just two years, from $5.1 billion to $8.2 billion.

    • Investments in sustainable food and fibre led the way, accounting for $6.5 billion in private capital committed during the decade covered by the report.

    • Investors regard conservation investing as a stable return, with 31 per cent of all investors surveyed anticipating rates of return between 5 per cent and 9.9 per cent.

    • Private capital is beginning to reach emerging markets. While the vast majority of investments in habitat and water conservation remained concentrated in North America, private finance for sustainable food and fibre production was more evenly dispersed between North America (33 per cent), Latin America (29 per cent), Oceania (19 per cent) and Africa and Asia (about 9 per cent each).

    “The findings of this report speak to the growing recognition of our forests, our wetlands, our reefs, and other natural landscapes as smart investments – a notion that would have been unthinkable to most mainstream investors just five years ago,” said Michael Jenkins, Founding President and CEO of Forest Trends.

    “Just in the last two years covered by this report, we’ve seen a huge leap in demand for these kinds of tangible ‘real assets’ from investors. The demand is growing across the globe and from across investment instruments – the only thing keeping these emerging asset classes from surging even higher is the scarcity of investable opportunities; and, as in any emerging market, transparent information is critical.”

    Atlantic Forest regeneration taking place in 9 states, Brazil says

    2017 - 01.18

    An area of Brazil’s Atlantic Forest equivalent to the size of Sao Paulo city has been successfully regenerated over the past 20 years, Brazil conservation and research organisations say in what is positive news for people interested in Brazil’s forestry industry.

    Data from the SOS Mata Atlântica Foundation and the Brazilian Institute for Space Research (INPE) shows that between 1985 and 2015, 219,735 hectares of the Atlantic Forest went through a process of regeneration in nine of the 17 Brazilian states that have the forest.

    According to the Atlas of the Atlantic Forest Remains, which monitors the spatial distribution of the forest, the state of Parana, one of the country’s largest grain producers, reached the largest areas of regeneration in the period assessed, totalling 75,612 hectares; followed by Minas Gerais (59,850 hectares), Santa Catarina (24,964 hectares), Sao Paulo (23,021 hectares) and Mato Grosso do Sul (19,117 hectares).

    “The survey mainly analyses the regeneration of forest formations in early stages of native plant growth, or of areas previously used for pasture, which are now in an advanced stage of regeneration. This process had both natural and induced causes, when native tree seedlings were planted,” the SOS Mata Atlântica Foundation said.

    Over the last 30 years, deforestation has fallen by 83 per cent in the forest, with seven of the 17 states where there is Atlantic Forest already reaching zero deforestation.

    “Now the challenge is to recover and restore the native forests we have destroyed,” the foundation’s executive director Marcia Hirota said.

    Brazil ‘cornucopia of possibilities’

    2017 - 01.10

    It is a country in recession and full of political upheaval, but Brazil still presents a ‘cornucopia of possibilities’ for investors, it’s been claimed.

    In a post for CNBC, journalist Dawn Kissi writes that the country’s “turbulent” 2016 – which saw a less-than-perfect Olympics and political corruption scandals – should have been enough to scare off people thinking of putting their money into the Latin American economy.

    “Nevertheless, the country that put the ‘B’ in the bloc of emerging market powerhouses known as BRICS continues to deliver hefty returns on its stocks, even weathering a deep economic downturn and loose monetary policy,” Kissi said.

    Kissi notes a number of things that could be set to help Brazil:

    Brazil’s central bank’s recent rate cut shows it “stands ready” to help Brazil out of its deep recession.
    Brazil’s broad stock index returns topped 60 per cent in US dollar terms in 2016 – the best-performing emerging market excluding dividends.
    Potential government reforms.

    The IMF now expects Brazil’s economy to grow, albeit modestly, by 0.5 per cent in 2017.

    Douglas Johnson, managing director of investment banking firm Cranganore, told CNBC that better growth in China and the US in 2017 – where much of Brazil’s exports go – will “ricochet” back to Brazil.

    “Brazil is a cornucopia of reform possibilities, all of which will help drive growth,” Johnson said.

    “The obvious candidate is the tax system. Other areas include a bloated, state-run pension system and rigid labour laws.”

    Some risks do remain, though, Kissi pointed out, with some fearing the country falling short of growth targets or reform efforts. “Investors will abandon assets if economic policy falters,” Johnson said.

    Project to grow Brazil eucalyptus tree population launched

    2017 - 01.10

    A new project to inject fresh energy into Brazil’s forestry investment landscape is to be welcomed.

    A tie-up between ArborGen, a global supplier of seedling products and forestry industry technologies, and International Paper Brazil, a packaging producer, will see an “increased effort” to develop and sell new varieties of eucalyptus seedlings in Brazil.

    The agreement will also lead to the growing of eucalyptus plantations in regions of Brazil where there is growing interest in the genus – potentially good news for those keeping an eye on forestry investment in Brazil.

    The deal will give ArborGen additional access to International Paper Brazil’s eucalyptus germplasm.

    Since 2013 when the company began its commercial sales operation, sales have increased to a current projection of 47 million eucalyptus seedlings and nine million pine seedlings in 2016.

    “The Brazilian forestry industry is one of the largest, fastest growing in the world; Brazil is the world’s largest producer and exporter of hardwood pulp,” the companies said in a statement.

    The eucalyptus market utilises approximately 700 million seedlings per year. With the original agreement, private landowners gained access to elite eucalyptus clones that were once only available to integrated producers. This new agreement will increase that access and allow for additional development of advanced genetics for landowners.

    “This expanded agreement allows ArborGen to utilise its advanced technologies and tree breeding expertise with IP germplasm to continue to improve the genetics of existing seedlings,” said Gabriela Monnerat, managing director of ArborGen of Brazil.

    “We will also be able to offer additional benefits such as increased yields and improved growth to landowners while expanding the breeding program to other regions of Brazil and other sectors as sawtimber, bioenergy, etc.”

    Sale of construction products rose again in Q4

    2017 - 01.06

    UK sales of construction products rose for the 15th consecutive quarter in the final three months of 2016, according to figures.

    The data from the Construction Products Association’s (CPA) latest State of Trade Survey, in positive news for people keeping an eye on timber investment trends, show that 78 per cent of so-called heavy side firms – those dealing in steel, bricks, timber and concrete – said sales increased in Q4.

    The same goes for light side companies, with 75 per cent of firms reporting that sales were higher than a year earlier – the highest balance since Q3 2014.

    But it’s not all rosy. The CPA also warned that 2017 could be a testing year, as companies battle with cost pressures driven by the fall in the value of sterling following the result of the EU referendum.

    “Unsurprisingly, manufacturers’ expectations for 2017 appear to have been tempered by the uncertainty surrounding the economic and political outlook,” said Rebecca Larkin, CPA senior economist.

    “Heavy side manufacturers appeared most exposed to the effects of sterling’s depreciation during the second half of 2016.

    “In Q4, two-thirds of firms reported an increase in costs, the highest in five years, and a further 89% anticipate an increase over the next year.

    “Rising costs of imported raw materials continue to be a primary driver of cost inflation, but there is now an indication that currency weakness is filtering through to higher energy and fuel costs too.

    “The impact of Brexit on the construction industry is, as yet, unclear, but it is unlikely this year will be as buoyant as last unless government is able to provide greater certainty and the industry is able to manage cost pressures.”

    Woodland Trust warns over fly-tipping after worst year on record

    2017 - 01.06

    The Woodland Trust is warning about the effect fly-tipping is having on woodlands and wildlife after seeing its worst year on record for the illegal dumping of rubbish.

    The charity says it spent £42,596 clearing up 196 incidents of fly-tipped waste across the UK last year, bringing the overall bill for dealing with litter in its woodlands to around £354,000 – some way up from the £192,000 spent the year before.

    Since 2010, the trust has spent more than £1 million on dealing with fly-tipping and picking up litter – money it says would be better spent on protecting existing woods and creating new ones.

    Well-managed and protected woodland are all attractive ways to encourage forestry investment.

    The trust highlighted one incident in which 280 bags of rubbish were collected from Windmill Hill near Runcorn, an urban woodland, along with mattresses, a fridge and garden fence panels.

    Norman Starks, Woodland Trust UK operations director, said: “It’s worrying to see, in a world where our woods face constant threats from disease, pests and development, that we also have to deal with the actions of mindless individuals.

    Each year we are spending thousands of pounds clearing up other people’s waste, which could otherwise go towards creating new woods or protecting ancient woodland.

    “At the end of the day fly-tipping is an illegal activity, and people need to understand and remember that it has numerous implications for our woods and wildlife. We all need to care for our natural environment or risk ruining it forever.”

    Woodland ‘important income stream’

    2017 - 01.04

    Farmers could benefit financially by bringing undermanaged woodland back into production, forestry investment experts have said.

    An article for Farmers Weekly highlights the importance of woodland as an alternative income stream for farmers looking to reduce pressure as they battle with reduced support for agriculture.

    Mike Tustin, a chartered forester with specialist forestry agent John Clegg & Co., told Farmers Weekly that the opportunities presented by planting new trees or actively managing existing woodland are often overlooked by farmers.

    “It is estimated there is more than one million hectares of trees currently undermanaged, predominantly in the south-east of England,” he said.

    “Bringing these back into production could produce an income stream for landowners relatively quickly.”

    Over the past few years, timber prices have risen and woodland and forestry values have “rocketed”, Farmers Weekly said, driven in part by the recent drop in the value of sterling.

    “There has been a resurgence in the market for energy wood, thanks to the boom in biomass boilers and woodburners, along with the introduction of the Renewable Heat Incentive,” Mr Tustin said.

    It means woodlands that were not worth maintaining 10 years ago are now looking financially attractive.”

    Warning over Wales’ wood levels

    2017 - 01.02

    A timber firm is warning that Wales could soon run out of wood unless problems are addressed.

    Clifford Jones Timber, one of the UK’s largest makers of timber fence posts, says that a failure to meet planting targets is turning Wales into a tree-free zone and threatening an industry that’s worth over £450 million a year, Wales Online reports.

    Penny Lloyd, purchasing director of the Ruthin-based company, said: “The forest industry is an essential part of the Welsh economy, and together with its ancillary businesses, sustains many rural communities.

    “An on-going programme of commercial timber planting is vital for the survival of our industry.

    “Back in the 1970s we were planting over 7,000 acres of trees every year – in recent years it’s been less than 250 and this is a crop that takes 20 years plus to grow to maturity.

    “We have lost over 40,000 acres of forestry in the last 15 years – that’s an area one and a half times the size of Liverpool – and that needs to be replaced if our timber industry is to survive.”

    Only 14 per cent of Wales, or 750,000 acres, is forested.

    Ms Lloyd added: “There seems to be an opposition to planting conifers but it makes sense in terms of the needs of both commercial forestry, and conservational and amenity woodlands.”