Financial returns from forestry
New Zealand has the best growing conditions in the world for plantation forestry, in particular for Pinus radiata & Douglas Fir forests.Consequently New Zealand is a great location for optimal financial returns from forestry.
Returns from Forestry investment rely on a natural wealth creation process which continues year after year.As the trees get taller & fatter, you get wealthier therefore the faster the trees grow, the quicker your investment gains value.
Wood products supply & demand
Forestry is a tangible asset, it cannot be shifted or stolen , & historically pricing for timber has always kept pace with inflation providing real financial returns for investors.
Of course the financial returns also depend on supply & demand.According to Dr WRJ Sutton, there will be a projected shortfall of wood growing to 2,000,000 m3 by 2050.Only plantation forests will be able to bridge the resulting gap in supply.
This shortfall is due to several factors:
In fact the domestic supply gap in China alone is projected to reach approximately 150 million m3 (roundwood equivalent) by 2015 — or a volume that is more than the entire Canadian timber harvest in 2009 — a strong indication that China’s wood imports must continue to rise in the short- to medium-term period to match with projected consumption
Consequently log prices are moving up & your Enzo Carbon Forest bond is expected to increase in value accordingly.
Returns from Carbon Trading
An alternative source of revenue for forestry investments can be obtained by selling carbon credits.The selling of carbon credits is a fast growing market.A recent New York Times article described carbon trading as one of the “fastest-growing specialties in financial services”...and companies are scrambling to get “a slice of a market now worth about $30 billion and that could grow to $1 trillion within a decade.” The article, entitled, “In London's Financial World, Carbon Trading Is the New Big Thing,” continues: “Carbon will be the world's biggest commodity market, and it could become the world's biggest market over all.”1
However you should be aware that if the Enzo Carbon Forest Trustees decide to extract revenue from the forest via the selling of carbon credits, then if the forest is subsequently harvested for timber, those carbon credits will have to be repaid.This is a management decision that the trustees will make as the forest grows & will be based on market conditions.
whatever befalls in accordance with nature shall be accounted good