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Timberland Investment
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Weyerhaeuser Joins International Voices in Support of Forest Certification

Weyerhaeuser Joins International Voices in Support of Forest Certification | Timberland Investment | Scoop.it

Weyerhaeuser Company this week joined 25 of the world's leading forest products companies in announcing the need to significantly scale up sustainable forest management.


Weyerhaeuser and the 25 other members of the World Business Council for Sustainable Development (WBCSD) Forest Solutions Group are responsible for nearly 40 percent of annual global forest product, paper and packaging sales. 

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The companies endorsed the announcement following an international discussion including three forest certification systems -- the Forest Stewardship Council, the Sustainable Forest Initiative(R) and Programme for the Endorsement of Forest Certification -- at WBCSD's Council Meeting in Istanbul, Nov. 4. The Leadership Statement on the Value and Future of Forest Certification recognizes that reducing forest loss is a global societal priority requiring immediate and concerted action.


Earlier this year, Weyerhaeuser attained international stakeholder membership in the Programme for the Endorsement of Forest Certification, the world's largest forest certification system and the certification system of choice for small, non-industrial private forests. PEFC, which is made up of large forest owners and hundreds of thousands of family forest owners around the world, has endorsed two North American certifications standards, including the Sustainable Forestry Initiative. In the United States, PEFC also endorses the American Tree Farm System, which means landowners certified to SFI and Tree Farm also comply with the PEFC's internationally-recognized sustainability benchmark.

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Weyerhaeuser owns, leases or licenses 20.5 million acres of forests in North America certified to SFI, and more than 300,000 acres in Uruguay certified to FSC and PEFC.


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Plan for Hofmann Forest doesn’t include more farming or development, buyer says

Plan for Hofmann Forest doesn’t include more farming or development, buyer says | Timberland Investment | Scoop.it

The buyer of N.C. State University’s vast Hofmann Forest near Jacksonville has no intention of cutting down timber to make way for cropland or development, a spokesman for the company says.


NCSU officials announced Tuesday that the board of trustees that oversees the university’s endowment fund had agreed to sell the 79,000-acre tract – which is dominated by a working pine forest – to Hofmann Forest LLC, which is led by Jerry Walker.

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He and the other owners see the timber-farming operation as a great way to diversify their investments with a different kind of crop, wrote Tom Percival, a Lumberton-based spokesman for Hofmann Forest LLC, in response to emailed questions about the company’s intentions.

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The contract for the deal says that Walker’s company wants to sell easements to the military so that troops can continue to use the property, or at least the airspace over it, as they long have for training. The military is interested in purchasing those rights for about 70,000 acres, it said.

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The contract also says that the buyer intends to continue to allow access for NCSU faculty and students for research. It also intends to maintain a working forest there and to keep the Hofmann named attached to the forest, the contract says.

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In central Minnesota, potatoes are pushing out forest land

In central Minnesota, potatoes are pushing out forest land | Timberland Investment | Scoop.it

Agriculture is eating into central Minnesota’s forests so aggressively that state regulators and a prominent legislator are sounding the alarm about threats to wildlife habitat and a large, sensitive aquifer that stretches below parts of four counties.


The latest case is a 1,500-acre project in Cass County, which triggered a contentious legislative hearing last month over the owner’s plans to grow potatoes for McDonald’s and other customers on land that was covered with trees just 10 years ago.


In recent years, 5,000 to 6,000 acres of pine forests in Cass, Wadena and neighboring counties have been cleared for chemically intensive row-crop agriculture, and state officials say nearly 100 square miles of timber land now owned by Potlatch Corp. is at risk as the company divests itself of commercial forests in Minnesota.


Similar tensions could face the entire state faces as it copes with persistent water contamination and overuse, regulators say. The risk is especially worrisome along the border between traditional farm lands and the forested areas in central Minnesota, where contaminants can percolate straight through sandy soils into groundwater, and from there to trout streams and popular lakes.

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Some nuggets from Rayonier's Q3 2013 Earnings Call Transcript

Some nuggets from Rayonier's Q3 2013 Earnings Call Transcript | Timberland Investment | Scoop.it

Rayonier Inc. (RYN) Q3 2013 Earnings Conference Call October 24, 2013 2:00 PM ET


Mark Wilde - Deutsche Bank

Okay, and then just one other question Lynn. I know that you guys have been working on trying to develop more log export business out of the southern U.S. Can you just give us an update on kind of where that’s at and how you think that may develop over the next couple of years?


Lynn Wilson - Senior Vice President, U.S. Forest Resources
So, one of the things that we continue to do is to test those markets. So right now we have seen that our log export opportunities on the Atlantic port and in the Gulf port have been modest. We’ve all been container so far, no break box or free hold as we have in our Pacific Northwest operations and so that shipping cost is the break point for us.


So right now our domestic markets are better timber margin, but we are continuing to test it, continuing to have a small volume and we are continuing to work with opportunities that would increase that net timber margin.

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Paul Quinn - RBC Capital
Okay. Thanks very much and then just lastly, just on the timberland side, what do you see in those timberland market? It seems like that market has heated up quite a bit and very challenging and competitive out there. Maybe you could just share some of the color that you are seeing in your market place close to your timberlands and whether you guys have experienced this same sort of issues.


Paul Boynton - President & Chief Executive Officer
Yes. We think valuations are holding well and obviously continuing to improve and increase and we think that’s good. On the acquisition side, you know just year-to-date we probably looked at almost the same amount of property that we looked at a year ago, so there’s still pretty robust availability of timberland our there. I think if there was any change, there would have probably been two. I think we see plenty of dollars going after that availability.


So we definitely see that out there and we are seeing a little bit, at least this year, unless that fits our investment criteria. So for example I think this year-to-date, we probably evaluated 40 different properties. I mean we’ve offered on seven of those, which would have been lower that we where last year in terms of our percentage. And we’ve actually only acquired three small properties; about 12 million and that’s obviously separate from our New Zealand acquisition of 140.


So again, that would tell us that it’s at least not a sitting for our portfolio as maybe some others. It also tells us again it’s a pretty robust market in terms of timber and timberland values and that we also very disciplined.

The last three years we put out there and invested over $700 million and that includes the New Zealand acquisition and we can see the return on those investments and we feel very good about those returns and those investment. So we think our strategy is right on and this nature of that strategy is right on. It just takes a while and a lot of evaluation out there before you can bring them on in.
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Collin Mings - Raymond James
Okay, alright, thanks Lynn. And then just some of your peers have recently discussed the potential to work with some institutional timberland owners, but are kind of unhappy with the TMO model. So I was just kind of curious as far as how you guys are thinking about potential JV partnerships as it related to timberland opportunities. I know you guys already touched a little bit on the acquisition environment, but just from that [angle] I’ll be curious of your thoughts.


Paul Boynton - President & Chief Executive Officer
Well, I think we have a great JV in New Zealand right now, so we’re obviously working to really maximize that one and while here in the States we’re not really too actively searching for that opportunity.


Sam Radcliffe's insight:

Also mentioned was a 21,000 acre sale of timberland in Georgia that closed on the day of the call.

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Jack D Bridges's curator insight, October 28, 2013 10:32 AM

Another good find from S. Radcliffe (http://www.prentissandcarlisle.com/)

 

Rayonier took an absolute beating after releasing their recent quarter. Why? On the surface, looking at the things Wall Street cares about quarter-to-quarter, RYN missed expectations by .02 on the bottom line, and missed on the top line by a much larger 10% (expected revenue was $422M; RYN delivered $382M). For a such a long-cycle business, that alone wouldn't scare investors.

 

So, why the huge sell-off? Mr. Levinsohn, of Barron's, explains in rather good detail here: http://blogs.barrons.com/stockstowatchtoday/2013/10/25/everybody-hates-rayonier-shares-fall-15-on-earnings-miss-multiple-downgrades/?mod=yahoobarrons&ru=yahoo

 

When the one segment of your business that convinces investors you deserve a premium valuation--in Rayonier's case, cellose specialties--flashes a margin warning, that makes investors more than nervous. It makes them take profits:

http://stockcharts.com/h-sc/ui

 

At some point, investors looking for yield who don't know much--and aren't concerned with--about how Rayonier truly earns its net cash, will pile back into RYN. To these people, this is a buying opportunity--and it might be. To this observer, given the current valuation of the broader equity market and REIT segment--this isn't a time to be aggressive. This is the time to watch and wait--and watching RYN's cellulose specialties business for a quarter or two first, is a decent idea. 

JDB

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Hancock in hunt for Gunns asset

Hancock in hunt for Gunns asset | Timberland Investment | Scoop.it

US company Hancock Timber Resources Group and three Canadian superannuation funds are believed to have entered talks with receivers about a potential purchase of 200,000ha owned by Tasmanian timber company Gunns, which is expected to sell for more than $400 million when it goes to market next month.


The pension funds include the Canada Pension Plan Investment Board, Ontario Teachers Pension Plan and Alberta Investment Management Corp, according to a source.


The Tasmanian timber business was placed into administration last year, with debts of about $560m, and is expected to come up for sale in about a fortnight through insolvency firm Korda Mentha, with investment bank Moelis advising on the transaction.


On offer will be about 200,000ha of Tasmanian land, half of which is native forests that could not be used for timber plantations.

The Canadians are expected to look at the Gunns business along with interests of the collapsed listed company, Forestry Enterprises Australia.

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PPF appoints new farmland and timberland managers

PPF appoints new farmland and timberland managers | Timberland Investment | Scoop.it

The Pension Protection Fund (PPF) has appointed seven fund managers as part of its development of its alternative investment portfolio.


The managers will invest in farmland and timberland. The PPF has made this decision so that it can benefit from greater diversification and reduce its overall risk.


The seven appointed fund managers are: Brookfield Investment Management, Dasos Capital Oy, GMO Renewable Resources, Hancock Timber Resource Group, Macquarie, New Forests Pty and Stafford Timberland Group.

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Loggers forced to look for work in other places with Courtland mill closing

Loggers forced to look for work in other places with Courtland mill closing | Timberland Investment | Scoop.it

Eva logger Bobby Collins spoke with uncertainty as he described the options he will be forced to pursue when the Courtland mill closes.


In addition to the 1,096 International Paper employees who will be displaced when the mill closes by late March, the closure will also affect an estimated 5,404 loggers and foresters in Alabama, Mississippi and Tennessee, according to the Alabama Forestry Commission.


“It’s a bad situation,” said Collins, who has contracted with IP for 18 years. “We’re going to have to make cuts. The next thing we’ll do is look for other markets.”

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Battle simmers in northern Wisconsin national forest

Battle simmers in northern Wisconsin national forest | Timberland Investment | Scoop.it

A century after lumber barons cut down 1.5 million acres of timberlands now protected within the Chequamegon-Nicolet National Forest to help build Milwaukee and Chicago, industry managers say the riches within the regrown forest are being squandered at taxpayers' expense.


A battle pits cash-strapped loggers and mill owners against environmentalists and a growing woodland-recreation industry, Gannett Wisconsin Media reported.


Residents of Laona, a town of 1,200 people about 100 miles northwest of Green Bay, say the industry's struggles have contributed to skyrocketing tax bills, empty classrooms and shuttered shops. Meanwhile, loggers who remain in the business often travel hours each day to saw down private timber stands while the national forest remains off-limits to them.


"I feel like we have a family starving to death surrounded by an ocean of food and water," said Jim Schuessler, head of Forest County's economic development agency. State figures show forestry jobs in the county dropped from nearly 700 in 2008 to just 118 in 2010, partly as a result of the housing crash.

Schuessler said the region is hamstrung by restrictive harvest limits within the forest.


Records show the U.S. Forest Service could have sold and cut 1.3 billion board feet of wood in the past decade under its forest management plan. That would have represented roughly $110 million in revenue. But loggers cut just 755 million board feet, or a little more than half the allowed quantity.

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Molpus Woodlands Group to Acquire 73,000 Acres in Alabama

Molpus Woodlands Group to Acquire 73,000 Acres in Alabama | Timberland Investment | Scoop.it

The Molpus Woodlands Group, LLC (Molpus), a timberland investment management organization headquartered in Jackson, Mississippi, has, on behalf of a client, entered into an agreement to purchase approximately 73,000 acres of timberland located north, east, and west of Birmingham, Alabama.  The close of the purchase is set to occur in installments starting in October 2013.


The timberland, located in thirteen counties, consists of well-stocked loblolly pine plantations distributed among all age classes.  Molpus currently maintains an office in Hoover, Alabama, to oversee the management of approximately 161,000 acres purchased earlier in the Birmingham area.


"We look forward to adding another property under management in the Alabama area," said Molpus Woodlands Group President, Dick Molpus.  "These properties represent a high-quality timberland investment within a competitive timber market, and they offer strong recreational opportunities to the region as well."


Molpus currently manages approximately 1.5 million acres of timberland investments in seventeen states and employs ninety-seven peope in its fifteen offices operating in Alabama, Arkansas, Florida, Georgia, Idaho, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, New York, North Carolina, Oklahoma, Pennsylvania, Tennessee, Texas, and Virginia. 

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Jack D Bridges's curator insight, October 16, 2013 11:13 AM

No mention of price for the deal, but let's assume that Molpus didn't acquire these timberlands for their client at a discount. It would be interesting to see how they break-down the pure timber value per acre, in addition to the HBU acreage involved. 

Thanks to S. Radcilffe at Prentiss & Carlisle for the scoop!

http://www.prentissandcarlisle.com/

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UK Forest Fund now one of the largest forest owners in the UK

UK Forest Fund now one of the largest forest owners in the UK | Timberland Investment | Scoop.it

FIM Forest Fund I LP – Haregrain Forest ... raised a further £19.1 million, increasing the value of the portfolio to over £60 million. It now owns 9,851 hectares of highly productive commercial forestry and is harvesting some 220,000 tonnes of timber per annum.


The LP is structured to allow smaller scale investors to enjoy the benefits of a forestry investment, which are normally only available to those investing in excess of £1 million in a directly owned property. The LP is tax transparent, so the favourable tax treatment applying to commercial forestry applies to each individual member.


Forestry income is exempt from income tax and capital gains tax. In addition, it qualifies for 100% relief of inheritance tax once an investment has been held for two years.
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These benefits were available subject to a minimum investment of £30,000, making forestry readily accessible to a wide range of investors.

Forestry has been an excellent investment in recent years. The IPD UK Forestry Index has outperformed equities, gilts and commercial property over the past 10 years. The LP has provided strong returns to date. The blended IRR of all members has been 11.9% post-tax.

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Is Weyerhaeuser Destined for Greatness?

Is Weyerhaeuser Destined for Greatness? | Timberland Investment | Scoop.it


Weyerhaeuser put together a strong performance with seven out of nine passing grades, but it was tripped on free cash flow, which has grown more modestly (albeit from a much higher starting point) than net income, and which may not be sufficient to support the company's current dividend payments. A surge in free cash flow could bring Weyerhaeuser to perfection, but that may be far easier said than done.

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Weyerhaeuser is poised to profit from the growing demand of construction materials in the U.S. homebuilding markets, particularly as lumber costs continue to rise. Fool contributor Bob Ciura notes that home affordability in the U.S. remains near historically high levels, and home prices rose in 87% of U.S. cities in the second quarter, signaling either a robust recovery, or the possible start of a new bubble, depending on how you want to look at it.

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Weyerhaeuser recently acquired Longview Timber from Brookfield Asset Management and its Brookfield Infrastructure Partners affiliate in a deal worth $2.65 billion. Fool contributor Anjum Khan points out that the deal provides access to roughly 645,000 acres of timberland, which will increase its timber assets in the Pacific Northwest by a third, to about 2.6 million acres. In addition, the region provides easy access to export markets across the Pacific Ocean in Asia, as well as good soil and climatic conditions for the Douglas fir. Weyerhaeuser would also be able to take advantage of tight supply conditions in the north of British Columbia caused by the pine beetle through this new acreage.

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ASIC deregisters five timber schemes

ASIC deregisters five timber schemes | Timberland Investment | Scoop.it

The Australian Securities and Investments Commission (ASIC) has deregistered five former timber managed investment schemes (MIS) that had been managed by Kangaroo Island Plantation Timbers (KPT).


The five schemes were deregistered between 23-30 September, with timber growers given refund payments and an opportunity to purchases shares in the company.


When the share offer closed three former growers for KPT had applied for 1126 shares at $1.50 per share, down on the late August price for KPT of $1.64 per share but well up on the late June price of $0.004 per share.

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New study: Forests most likely to continue shrinking

New study: Forests most likely to continue shrinking | Timberland Investment | Scoop.it

Forest cover around the world will continue a slow shrinking before stabilizing at a lower level, according to a new study from the University of Guelph.


Researchers analyzed forest trends from around the world and developed a mathematical model to show future land use changes. They found the most likely model shows forests will decline from 30 per cent of Earth's land mass today to 22 per cent within the next two centuries.

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They analyzed several centuries' worth of forestry data from the Food and Agricultural Organization of the United Nations and other sources in the literature. Perhaps surprisingly, forest cover has held steady and even grown slightly in industrialized nations. In developing countries, forests are declining as populations grow and farming claims more land. Worldwide since 1990, forests have declined by more than 70 million hectares, a land mass greater than France.

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They used the world food equation, which relates agricultural land area to population, per capita consumption and farm yield. The model quantifies how much farming improvements, such as increased yield, reduce the amount of land needed to feed a growing population.


But if world population reaches 10 billion (based on mathematical trends), human uses will take up about two-thirds of the world's land area. With 15 per cent of Earth's land mass already classified as arid, only 22 per cent would be left for forest and wild pasture conservation.


"We tried to keep this model simple so there aren't too many unknown parameters. We realize that no one can determine the future, and there could be drastic changes in agricultural yield, food technologies or diet which could impact on our findings, but we attempted to explore those kinds of changes in our scenarios," said [co-author Madhur] Anand.


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NC State goes to contract on 79,000 acre Hofmann Forest

NC State goes to contract on 79,000 acre Hofmann Forest | Timberland Investment | Scoop.it

The trustees of N.C. State University’s Endowment Fund have agreed to sell the 79,000-acre Hofmann Forest near Jacksonville to an Illinois-based agribusiness company for $150 million, the university announced Tuesday.


The buyer is a family-owned, multistate firm headed by a third-generation farmer named Jerry Walker, NCSU officials said.

According to the contract, the company intends to sell the U.S. Department of Defense easements that will allow aviation training over about 70,000 acres of the property. That land could be used for timber or farming but not development for, say, houses.

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Investments from the proceeds of the sale are expected to bring in about $6 million a year, NCSU Chancellor Randy Woodson said.

Sam Radcliffe's insight:

The per acre price works out to $1,899, and the article seems to indicate that there is no development value and only 70% of the property is productive. Apparently the productive land is mostly pine plantation (http://goo.gl/NMC9sT).


By comparison, the MeadWestvaco lands just sold to Plum Creek are probably more productive and went for $1,734 per acre. The DOD easements will probably bring the net cost for Hoffman closer to this figure.


Another interesting calculation: NCSU's implied timberland discount rate (alternative rate of return) is less than 6/150= 4%. 

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Roger Lord's comment, October 30, 2013 11:29 PM
And that's a nominal rate of 4%, so the real rate is more like 2%. They aren't aiming real high are they?
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Plum Creek Timber to acquire land from MeadWestvaco for $1.09B

  • Plum Creek Timber (PCLwill acquire 501K acres of timberlands in Alabama, Georgia, South Carolina, Virgina, and West Virginia for $869M and rural and development-quality lands near Charleston, South Carolina, for $152M from MeadWeastvaco (MWV). The deal also includes $65M for subsurface rights and wind-power assets on the timberlands.
  • In conjunction, the 2 companies formed a joint venture to develop the South Carolina lands.
  • The majority of the proceeds will be distributed to MeadWestvaco shareholders.
  • Plum Creek announced it intends to finance the acquisition by offering 14.1M shares (2.115M overallotment) in a follow-on. The sale would be good for proceeds of $700M at today's close.
  • MeadWestvaco PR, Plum Creek Timber PR
Sam Radcliffe's insight:

The last of the vertically integrated paper companies finally gives it up. The reported purchase price for timberlands is $1,734 per acre.

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Good Earth Power Finalizes Agreement with The Campbell Group to Manage Forest Restoration Operations Under 4-FRI Contract

Good Earth Power Finalizes Agreement with The Campbell Group to Manage Forest Restoration Operations Under 4-FRI Contract | Timberland Investment | Scoop.it

Good Earth Power (GEP) is proud to announce the appointment of The Campbell Group as the forest management company that will implement GEP’s Four Forest Restoration Initiative (4-FRI) stewardship contract in Northern Arizona.

The Campbell Group will be responsible for managing forest restoration operations under the 4-FRI contract and will work with GEP to achieve the project’s objectives. As one of the largest timber investment managers in the world, with over 3 million acres under management, The Campbell Group brings decades of timberland management experience and industry knowledge.

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Timber Forecasts, Inflation and the Price of Eggs

Timber Forecasts, Inflation and the Price of Eggs | Timberland Investment | Scoop.it

At times, when developing timber forecasts or reviewing timberland valuation models, we find that inflation is misunderstood. A single rising price of a single product or commodity is not inflation. Sawmills are making more money this year because lumber prices are higher than last year, not because of inflation, which tracks the overall price level. And yet, the real, relative costs and revenues affecting timberland investments and wood-using facilities do change over time at different rates and times. While cash flow estimates used to value potential investments include projections of future prices, we find honest confusion and common mistakes continue to plague the use of real and nominal rates and prices.


In developing timber forecasts in the U.S., we recommend quantifying historic relationships using nominal (stated) prices that include inflation, and then adjusting for inflation if necessary. Why? Because the basis of market clearing transactions and real-time negotiations between wood buyers and timber sellers at any point are the prices as known and stated at that time in each and every local timber market given the known and available supplies and technology. As noted by timberland appraiser Jeff Wikle, “Yesterday’s (timber) price is based on yesterday’s technology.” Based on our understanding of forestry markets, this is exactly correct.

Sam Radcliffe's insight:

This article includes notes from Dr. Mendell’s “Accounting for Inflation in Timber Forecasts” presentation in Portland at the 2013 “Who Will Own the Forest?” conference.

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Gunns properties raise overseas interest

Gunns properties raise overseas interest | Timberland Investment | Scoop.it

Global interest is being fielded for former parts of the greater Gunns estate - the AFPT and AFPT 2 timberland portfolios - that have been put on the market.


Prospective buyers range from Australian pension funds, high net-worth individual investors and overseas-based pension funds.


A price tag of about $50 million was suggested for the 94 forestry products in the portfolio.


The Tasmanian assets are being sold by CBRE Agribusiness on behalf of Peter Anderson and Shaun Fraser of McGrathNicol as ''Joint and Several'' receivers and managers of the Australian Forestry Plantations Trust (AFPT) and the Australian Forestry Plantations Trust Number 2 (AFPT 2).


Gunns, based in Tasmania, was placed into voluntary administration in September 2012 after an ANZ-backed syndicate withdrew support for the forestry group's recapitalisation.


This included the group's long-running attempt to obtain approvals for a timber pulp mill at Bell Bay, at a cost of about $2.3 billion.


David Smith, CBRE's head of timberland transactions, said the sale campaign had already generated wide-ranging preliminary interest. The two portfolios were being offered for sale in one line or separately, he said.


They comprise 94 properties with a total of about 11,757 hectares of hardwood plantation across an area of 21,777 hectares.

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In Russia's Vast Far East, Timber Thieves Thrive

In Russia's Vast Far East, Timber Thieves Thrive | Timberland Investment | Scoop.it

Forests cover about half of Russia's land mass, an environmental resource that President Vladimir Putin calls "the powerful green lungs of the planet."


But Putin himself acknowledges that Russia, the world's biggest exporter of logs, is having its timber stolen at an unprecedented rate.


The demand for high-value timber is fueling organized crime, government corruption and illegal logging in the Russian Far East. The hardwood cut in the endless forests often ends up as flooring and furniture in the United States, Europe, Japan and China.


At a meeting on timber management earlier this year, Putin said that illegal logging has increased by nearly 70 percent over the past five years, and he added that timber thieves have no problem selling their product.


Illegal loggers are often linked to violent organized crime, and together, they undermine what officials say could be sustainable forests and contribute to Russia's endemic corruption by paying off local officials.

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Nicole Kearsch's curator insight, October 25, 2014 1:28 AM

I never thought that timber would be something that was a top priority on any thieves list.  It almost makes sense though.  People with the permits to harvest the wood in east Russia and they happen to harvest a few pieces here and there and create a huge market for discounted lumber.  The problem not only lies legally but environmentally as well.  An excess of trees which produce oxygen are being cut down, but the homes of the SIberian Tiger are being taken away.  Legally this is becoming a big problem for companies such as Lumber Liquidators, known widely throughout America for its cheaper prices on wooden flooring.  This company has been the target of investigation because of the fact that it has been potentially knowingly been buying its lumber from illegal sources.  This whole operation needs to be stopped.  The corruption of governments taking money from companies needs to be controlled and there needs to be a plan put in place to stop this illegal logging. Legally it is a problem but very importantly it is an environmental issue that is going to end up affecting everyone. 

Kaitlin Young's curator insight, October 27, 2014 8:44 AM

Russia’s large forests are one of its most viable resources, considering the size and climate of the country. Russia exports large quantities of high quality wood to the United States, China, and Japan, but at what cost? The value of this industry has sparked government corruption, illegal logging, and organized crime. Legality issues in any natural resource based industry usually results in a major decrease in sustainability. One of Russia’s most well-known animals, the Siberian Tiger, is being affected through loss of habitat and destruction of the food chain at a lower level. Beyond environmental destruction, lumber is being illegally harvested and exported to companies that do not realize that the wood is illegally obtained. Russia must find a way to control logging while enforcing sustainable practices in order to maintain one of their greatest resources.

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FAME approves $25 million loan for Millinocket pellet mill

FAME approves $25 million loan for Millinocket pellet mill | Timberland Investment | Scoop.it

The Finance Authority of Maine’s Board of Directors voted 8-5 to approve a $25 million bond on Thursday to build New England’s first torrefied wood pellet mill in Millinocket’s Katahdin Avenue industrial park.


The key to Cate Street Capital’s proposal is a $35 million torrefied wood machine that according to FAME’s analysis will employ as many as 36 people directly and as many as 184 indirectly. If successful, the enterprise could attract as many as 1,500 new jobs to the state, according to its supporters.


If it fails, taxpayers could be on the hook for $25 million, proponents of a lesser bond amount said.


The machine is the first of as many as five in Millinocket and three in Eastport making torrefied wood pellets, which burn hotter than regular pellets and are intended as a cleaner-burning coal substitute. The other machines will likely each employ 20 to 25 people directly and about 100 people indirectly, including logging crews supplying the mills with millions of tons of wood wastes taken from the forest floor, company officials have said.

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Australia: Thousands of hectares of south west timber plantation could be returned to agriculture

Australia: Thousands of hectares of south west timber plantation could be returned to agriculture | Timberland Investment | Scoop.it

The plantation timber industry is playing down concerns about the sector's plight in southern Western Australia despite predictions of a major rationalisation of the estate.

The business that took over tens of thousands of hectares of timber plantations from a collapsed company says as much as two-thirds of the land could be returned to agriculture.


When Great Southern collapsed, international forestry manager New Forests bought 60,000ha of its plantations.


New Forests' David Brand said a third of the land will be returned to agriculture.


He said another third will be retained for forestry while the future of the remaining land will depend on market conditions.

"In some areas, the plantations were pushed out into areas that were too dry for forestry," Mr Brand said.


Increasingly, plantations are being converted back to agriculture, but consultant David Wettenhall insists it is a market correction, not a demise.

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Timber industry sues to lift logging ban during shutdown

Timber industry sues to lift logging ban during shutdown | Timberland Investment | Scoop.it

Western timber companies have gone to court to lift the logging ban on national forests due to the government shutdown, arguing the government has no authority under timber sale contracts to force loggers to stop working.

Three wood products companies and a timber industry association filed the lawsuit Monday in U.S. District Court in Medford against the U.S. Forest Service and the U.S. Bureau of Land Management.

The lawsuit seeks a temporary restraining order lifting the logging shutdown, arguing direction from the Office of Management and Budget does not require suspension of operations on a federal contract so long as direct supervision is inessential to the contractor's work. It adds that some of the contracts involve work that is improving public safety by reducing wildfire danger and removing dead trees in danger of falling in campgrounds.
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"It makes zero sense for the cash-strapped government to shut down operations that pay millions into the United States Treasury," said Tom Partin, president of the American Forest Resources Council, the timber industry group that filed the lawsuit. "A timber operation isn't something you can turn on and off like a light switch. Once equipment has to be moved out, it can be months before it can be moved back in.

"What is happening to our members is particularly frustrating when other businesses with contracts to operate on federal land, such as ski areas, are being allowed to continue working," Partin added in a statement
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The Forest Service started sending out notices to 450 timber buyers last week, saying they had to wrap up operations and put measures like erosion controls in place. The BLM, which sells timber only in Western Oregon, followed suit.

Though some companies depend heavily on federal timber sales for their logs, national forests produce only about 5 percent of the nation's lumber supply. Since logging was deeply cut back on national forests in the 1990s to protect fish, wildlife and clean water, markets have turned to other sources, such as Canada and private lands.

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Maine: New forest products study shows industry is far from dying, advocates say

Maine: New forest products study shows industry is far from dying, advocates say | Timberland Investment | Scoop.it

Maine’s forest products industry contributes $8 billion in total value to the state’s economy, including 38,789 direct and indirect jobs, a new study commissioned by an industry advocacy group shows.


According to the study released this week by the Maine Forest Products Council, the forest products sector in Maine includes businesses, organizations and individuals involved in logging and forestry, paper and related product manufacturing, sawmills and wood product manufacturing, wood furniture manufacturing, wood biomass power generation, maple syrup production and activities of the Maine Forest Service.


Although some critics contend that the study paints a rosy picture of a declining industry, the study’s goal is to illustrate how the industry is still a vital player in Maine’s economy, said Roberta Scruggs, the council’s spokeswoman.


“All you are hearing is that there are fewer jobs,” Scruggs said Wednesday. “That gives people the impression that the industry is shrinking or dying and that just isn’t true.”


What’s happening instead, according to the study, is that Maine’s forest industry and workers are more productive than ever, thanks partly to improved technology. Though far from booming, the industry has been generally retooling to prepare for an increase in productivity that industry workers expect will come with an improved economy, said Patrick Strauch, executive director of Maine Forest Products Council.

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Canada: Peak Lumber by 2016?

Canada: Peak Lumber by 2016? | Timberland Investment | Scoop.it

A persistent mountain pine beetle epidemic plus the housing crisis equals desperate times for Canadian forestry companies; many survivors are investing what's left into timberland located in the U.S. South.


In or around 2016, lumber supplies coming from Canada are expected to peak. Unless the situation deteriorates further, Canada's overall supply is expected to decrease by 9%, or 400,000 homes worth of wood products. 

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It's happening for three key reasons
1) Governmental lands are not professionally managed

2) Old growth, mature trees (+80 years) are more susceptible to disease and harmful insects

3) Less than harsh winters have not slowed the pine beetles progress

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Jack D Bridges's comment, October 11, 2013 10:48 AM
Does P&C offer any seminars for financial advisors? The author of the piece (and his clients) could benefit from more ways to invest in timber than owning Plum Creek equity. Also, he's a bit confused about Weyerhaeuser--WY has been a REIT since 2011. Thanks, Sam.