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  • New Kenyan initiative to boost timber investment

    2017 - 06.19

    There is a new initiative in Kenya to help people to make the most from their forestry investments.

    Goldenscape Tree Ltd is responsible for planting more than 500 acres all over Kenya, with the aim of restoring the country’s tree cover, as well as its cool and wet climatic conditions.

    The company was started in 2004 by Peter Wangai who first began planting trees as a hobby. However, he soon found that he could monetise the venture by turning it into a form of investment for other people.

    Deforestation and desertification are major problems in Kenya where people continue to cut trees without replanting them, or buy rural land with the intention of using them as investment potential but ending up neglecting the land until it falls into ruin.

    The company aims to change this.

    Many Kenyans currently lack the time or money to develop their land, but Goldenscape Trees offers a solution.

    “Once a client allows us plant trees on their land, we manage the trees from the time we plant them until they are mature. This is advantageous to the clients in that they do not have to participate in the management of the trees or anything related to their growth since that is done by the company, so they do not have to worry about having to constantly check on the land,” he explains.

    When the trees are mature, they are sold locally or exported and the profits go to the clients, he adds.

    “We offer different options under our greenhouse investments. If a client has land that is less than an acre and is willing to invest with us, depending on their financial capabilities, we set up one or two greenhouses on their land,” says Mr Wangai.

    “We set up and manage the greenhouses and the crops until they are ready, then we harvest and sell them. The profits, like in the case of trees, go to our clients,” he adds.

    Ms Carolyn Wanjiku, the administrator at Goldenscape Tree Ltd, has said the benefits of the programme extend beyond the individual and to the country as a whole.

    “I would advise Kenyans to embrace such investments because all these projects have by-products that can be sold. Besides, they increase food and timber production, which not only benefits the client, but also goes to boost the country’s economy.” says Ms Wanjiku.

    Brazil leads race for sustainable biofuel production

    2017 - 06.16

    Protecting peatlands has become a global concern in the fight for sustainable forestry. Could Brazil's efficient, new approach to biofuel production be the solution?

    Although peatlands cover only 3-5 per cent of the Earth’s surface, they store an incredible 30 per cent of all soil carbon.

    However, peat fires and increased draining of these lands for agricultural purposes have led to massive amounts of carbon being released as carbon dioxide into the atmosphere.

    So far, this release of carbon has led to some of the worst environmental disasters of recent times.

    Because of this, experts have highlighted the need to consider alternative ways to use the land, such as providing farmers with new methods to stop the destruction and preserve carbon stocks in the ground. One of these methods would be in the creation of biofuel.

    Brazil, the world’s second largest producer of bioethanol fuel, has been a good model of this in action.

    Dr. Nils Borchard, a researcher from Ruhr-University in Bochum, Germany, said: “Brazil has developed very efficient agricultural technology that uses sugar cane and its wastes to produce power. This produces energy at a competitive price and provides farmers with a new market.”

    New research is currently underway to look into which species can be cultivated successfully on certain types of degraded peatlands to restore them into sustainable forest and produce biomass and bio-fuel.

    The need to develop and implement sustainable forest management strategies for bioenergy production is urgent, and Brazil is currently one of the countries leading the race – good news for anyone looking to invest in the region.

    Costa Rica leads Latin America in fight against deforestation

    2017 - 06.16

    A climate investigation published in the University of Costa Rica's weekly Semanario Universidad magazine shows that despite Latin America's marked deforestation, Costa Rica has managed to sustain and even increase its own forest cover.

    The United Nations Organisation for Agriculture (FAO) attributes the preservation to state support as well as various incentives.

    For example, Costa Rica's environmental services payment program (PSA) is one of the most successful environmental public policies in the country’s history, and has been used as a model for other countries
    .
    Between 1996 and 2015, investments in forest-related PSA projects in Costa Rica reached US$318 million, according to the FAO. The idea behind the program is simple and effective: if you keep the forest on your property, Costa Rica will pay you.

    The report found that the program tends to be more successful away from national parks where landowners can often find more lucrative uses for their land due to the presence of tourism, which means conserving forest for government payments is not as attractive as in more remote areas.

    A key finding of the report was that while other Latin American countries cleared forests to make room for agricultural production, Costa Rica was able to increase conservation and sustainable management of forests without threatening their food security at all.

    Through increasing agricultural productivity and importing food from countries with lower production costs, Costa Rica has found a way to preserve its forest cover while maintaining strong levels of food security.

    Beekeeping supports sustainable forestry in Zimbabwe

    2017 - 06.14

    Zimbabwe is offering up an innovative new solution to protect their forests: bees.

    Non-profit group Environment Africa is teaching farmers to raise bees. The group is working in the Mutasa district, near the country’s border with Mozambique. And it has already helped about 1,500 farmers.

    The forests in Eastern Zimbabwe supply the country with wood and most of its fresh fruit, but are currently under threat from deforestation.

    According to officials, more than 1.5 million hectares of forest were lost in 2016 – mostly due to local communities clearing forested areas to make hunting easier, or through harvesting trees for firewood.

    Benjamin Chatambura, a farmer who has set up around 250 beehives near his home, said: “The trees provide us with flowers. That is the food for the bees to produce the honey. If there were a way, I would like more land to plant more different types of trees. We used to have serious problems before we were trained in the importance of the forest.”

    Chatambura sells the honey the bees produce and uses the money to feed his family. He said he likes having bees on his land because the insects help both him and the forest: “Now if you look around, the forest in Mutasa are improving because the communities are also collaborating with the adjacent timber industries to try and fight the forest fires. And at the same time, the plantations which are adjacent, have also allowed communities to also put their hives in their plantations as a way of trying to keep (out) forest fires."

    Supporting sustainable forest management not only helps the beekeepers, but also ensures the long-term health of the timber industry and the businesses it supplies.

    High-end chocolate takes a bite out of deforestation

    2017 - 06.12

    Some Amazonians are looking at one surprising solution to ending the epidemic of deforestation that are ravaging their communities – high end chocolate.

    Typically, the residents of Amazon settlements have limited opportunities to make a living, and are frequently subject to illegal and unsustainable loggers who try to cut down their trees.

    Finding a solution that would help benefit local people as well as preserving the rainforest has long been a subject of debate. But Brazilian officials have said projects like the cocoa co-op are helping the residents to make a living from the land while moving away from deforestation.

    Abilio Ikeziri is an official at Brazil's environment ministry who's responsible for protected areas.

    "These cocoa projects come from the community, we are a partner with them," he said, adding that the income also helps locals to keep the ranchers, speculators and land scammers out of the reserve.

    "I am the only (official) responsible for looking after 1.5 million hectares (15,000 km sq) of land – it is impossible (without local help)".

    In the Arapixi nature reserve, residents started by harvesting cocoa for their own consumption and began selling it to a cooperative 10 years ago.

    Over the course of last year they exported more than 10 tonnes of natural cocoa to Europe, where it is then refined into high-end, environmentally certified chocolate.

    Based in the Amazon river port of Boca do Acre the co-op employs more than 400 people.

    "Before we launched the co-op, many people were deforesting land for cattle," Manager Jose Geraldo Tranin said. "Now people know cocoa will generate some income so they are preserving the forest."

    Residents are given the tools and training to get started, and can earn up to 1,200 reais (285) per month in the busy season – a good salary for the area.

    The project has had a clear impact on forest preservation in Arapixi compared to similar Amazon reserves, according to Francidalva Oliveira de Souza, a researcher at the State University of Amazonas.

    "Deforestation has been decreasing in this reserve. This sort of project could be expanded to help preserve other areas and help residents earn an income."

    Brazilian Finance Minister predicts employment recovery in 2017

    2017 - 06.07

    Brazilian minister of finance Henrique Meirelles has predicted the labour market will reverse the negative trend before the end of the year.

    Speaking at an event in Washington, he asserted that there are definite signs of economic recovery ahead, but stressed the importance of approving economic reforms so the country could consolidate the recovery of growth.

    “There is no doubt that we will see a strong spike in employment in 2017. Afterwards, certainly very strong recovery in 2018, causing unemployment to fall sharply," said the Finance Minister. “Our conviction is that the approval of these reforms will soon become reality so this growth of the economy can be consolidated."

    Meirelles predicted that Brazil should begin to show growth in the first quarter, and lauded the signs of economic improvement that are already becoming evident.

    Forecasts have Brazil growing between 0.5 and 0.7 per cent quarter on quarter in the three months ending in March, with Meirelles expecting a 2.7 per cent expansion when compared with 2016’s last quarter.

    “The reason is that Brazil had a much worst-than-expected recession last year. And then, the GDP further declined and we had a lower basis to start the year with,” said Meirelles. “But we are already growing month-on-month.”

    The boost in employment will in part be due to the modernisation of labour laws. Another important factor will be pension reforms.

    The pension reform is currently under review by a special committee of the Chamber of Deputies. Approving it would provide for the adoption of a minimum retirement age of 65 for men and 62 for women.

    In 2016, the deficit in Brazil's social security budget was R$ 149.7 billion, and it's forecast that the shortfall for this year will rise to R$188.8 billion. Without pension reform, it's estimated that the deficit will reach R$202.2 billion.

    The traction that the Brazilian economy is beginning to regain will no doubt have positive knock-on effects for the timber industry, with a boost to investment returns.

    Brazil's ban on landfilling eucalyptus brings commercial potential

    2017 - 06.07

    Since the Brazilian government banned the landfilling of eucalyptus bark, their wood and paper mill industries have opened up great potential for manufacturers of waste-processing equipment.

    Lindner Recyclingtech is one such manufacturer, and they've claimed that their Urraco 75 shredder has been successfully processing shred eucalyptus bark for use as a Refuse Derived Fuel (RDF), and demand for their product has been on the rise.

    Lindner has set up business in Curitiba, said to be Brazil's greenest town, and have since begun to be used across Brazil in Eldorado Brasil in Tres Lagoas, Fibria in Aracruz and Fibraplac in Glorinha.

    The landfilling ban promotes investment in the relatively new concept of energy recovery from eucalyptus bark.
    The bark with a low calorific value is shredded and then mixed with wood chips and other inert material, turning it into fuel with high calorific value that can then be used directly to generate energy in the producers’ plant kilns.

    Although eucalyptus is not an indigenous tree species to Brazil, it has been used for forestry ever since it was introduced from Australia and Tasmania 200 years ago. These days, the largest eucalyptus plantations in the world can be found in south-eastern Brazil.

    In total, it's estimated that four to five million hectares are cultivated in Brazil – the main buyers of which are the country's pulp and wood panel producers.

    In the future, Lindner anticipate their shredders being sold not only in Brazil, but also in other South American countries where RDF is becoming ever more important in the areas of waste and energy.

    Brazil’s industrial production ‘recovering’

    2017 - 06.05

    Industrial output in Brazil enjoyed its best quarter one since the first three months of 2013, data shows.

    Brazil’s government said that as the country’s economy begins to recover, industrial production is beginning to show “signs of recovery”.

    Figures from the Brazilian Institute of Geography and Statistics (IBGE) show growth in the industrial sector of 0.6 per cent for the first quarter of 2016.

    This is the first time since 2013 – when output increased by 2.1 per cent – that industry growth has been positive, after experiencing “bitter consecutive losses”.

    “However, the scenario began a reversal in the wake of the reforms and measures implemented by the government,” it said in a statement.

    “Losses were gradually turned into positive results. The sector's performance is still far from ideal, now close to 2008 numbers, but is expected to fully recover in the coming months and years.”

    The IGBE said more industries are reporting growth, with positive results seen in two of the four major economic categories.

    Among the sectors surveyed, those that made the greatest contributions to the positive results were mining and quarrying (8.2 per cent) and motor vehicles, trailers and vehicle bodies (11.5 per cent).

    Other major contributors include computer equipment (18.3 per cent), apparel and accessories (eight per cent), metallurgy (1.9 per cent), rubber and plastic products (2.7 per cent), textiles (6.2 per cent) and machinery and equipment (two per cent).

    Brazilian Finance Minister predicts employment recovery in 2017

    2017 - 05.08

    Brazilian minister of finance Henrique Meirelles has predicted the labour market will reverse the negative trend before the end of the year.

    Speaking at an event in Washington, he asserted that there are definite signs of economic recovery ahead, but stressed the importance of approving economic reforms so the country could consolidate the recovery of growth.

    “There is no doubt that we will see a strong spike in employment in 2017. Afterwards, certainly very strong recovery in 2018, causing unemployment to fall sharply,” said the Finance Minister. “Our conviction is that the approval of these reforms will soon become reality so this growth of the economy can be consolidated.”

    Meirelles predicted that Brazil should begin to show growth in the first quarter, and lauded the signs of economic improvement that are already becoming evident.

    Forecasts have Brazil growing between 0.5 and 0.7 per cent quarter on quarter in the three months ending in March, with Meirelles expecting a 2.7 per cent expansion when compared with 2016’s last quarter.

    “The reason is that Brazil had a much worst-than-expected recession last year. And then, the GDP further declined and we had a lower basis to start the year with,” said Meirelles. “But we are already growing month-on-month.”

    The boost in employment will in part be due to the modernisation of labour laws. Another important factor will be pension reforms.

    The pension reform is currently under review by a special committee of the Chamber of Deputies. Approving it would provide for the adoption of a minimum retirement age of 65 for men and 62 for women.

    In 2016, the deficit in Brazil’s social security budget was R$ 149.7 billion, and it’s forecast that the shortfall for this year will rise to R$188.8 billion. Without pension reform, it’s estimated that the deficit will reach R$202.2 billion.

    The traction that the Brazilian economy is beginning to regain will no doubt have positive knock-on effects for the timber industry, with a boost to investment returns.

    Brazil’s industrial production ‘recovering’

    2017 - 05.05

    Industrial output in Brazil enjoyed its best quarter one since the first three months of 2013, data shows.

    Brazil’s government said that as the country’s economy begins to recover, industrial production is beginning to show “signs of recovery” in good news for forestry investors.

    Figures from the Brazilian Institute of Geography and Statistics (IBGE) show growth in the industrial sector of 0.6 per cent for the first quarter of 2016.

    This is the first time since 2013 – when output increased by 2.1 per cent – that industry growth has been positive, after experiencing “bitter consecutive losses”.

    “However, the scenario began a reversal in the wake of the reforms and measures implemented by the government,” it said in a statement.

    “Losses were gradually turned into positive results. The sector’s performance is still far from ideal, now close to 2008 numbers, but is expected to fully recover in the coming months and years.”

    The IGBE said more industries are reporting growth, with positive results seen in two of the four major economic categories.

    Among the sectors surveyed, those that made the greatest contributions to the positive results were mining and quarrying (8.2 per cent) and motor vehicles, trailers and vehicle bodies (11.5 per cent).

    Other major contributors include computer equipment (18.3 per cent), apparel and accessories (eight per cent), metallurgy (1.9 per cent), rubber and plastic products (2.7 per cent), textiles (6.2 per cent) and machinery and equipment (two per cent).