Timber Plantations Attract More Investors, Can Reward Region-Specific Strategies

BOSTON, Dec. 15, 2016 /PRNewswire/ -- In a global financial landscape where reliable returns are hard to find, investors are steadily upping their exposure to investments rooted in the land itself. Managed forest and timber plantations are among the real asset classes that generate more funding and M&A activity every year. To help guide investors through this landscape, the Global Tree Farm Economics Review 2017 from RISI provides deep research and analysis, including country attractiveness rankings and expected financial returns from planted forest investments.

"Planted timberlands provide a 'green' opportunity for the increasing number of investors seeking hard asset classes," said Dennis Neilson, timberland investment authority and co-author of Global Tree Farm Economics Review 2017. "However, it is essential to understand how to analyze investment options in developed, emerging, and frontier markets. Each has their place in a balanced timberland portfolio."

First published in 1997 and updated every 5 years, the Global Tree Farm Economics Review's rich historical foundation supports frank, detailed analysis of what works and what doesn't. It profiles 57 nations with data on forest assets, wood harvest and wood products trade; and for each country, provides overviews of key issues and opportunities for timberland investors.

The 2017 Review also supplies investors with 101 in-depth "case studies" that include detailed data-sets on tree farm establishment and development costs, wood yields, log market prices, harvesting costs and stumpage revenues. This breadth and depth of research enables Neilson and co-author Geoff Manners to generate important comparative metrics, including growing costs, Internal Rate of Return (IRR), and proprietary Timberland Investment Attractiveness Ratings and Rankings for the 57 profiled countries.

Neilson and Manners collectively have more than 60 years of experience in advising existing and prospective timberland owners on investment opportunities, and on the strengths – and challenges – of hundreds of individual projects around the world. Neilson also co-owned a timberland investment management organization (TIMO) for several years.

While North America continues to dominate the timberland investment universe, the authors have identified four distinct regional investment categories, according to Neilson. "These include: The 'Old World' of North American and Western European forests; the 'Mature New World' plantation forests of Australia, New Zealand, Chile, Uruguay and South Africa; the 'Emerging' regions of Central America, Other Brazil, Argentina/Paraguay and the Baltics; and finally the 'Frontier' regions of Asia (including China), Africa, and the Andes."

This new study addresses the range of returns from more than 100 country-region-species and regime options in all four of these regions, and also quantifies the timberland-specific investment risks for these countries.

Because Neilson has co-authored all five editions, and Manners three, they are both uniquely placed to compare how investment risks and returns have varied over the last 20 years – including several examples of investments that have not worked out, and why.

For more information on the study, visit www.risi.com/globaltreefarm

About RISI (www.risi.com)

RISI is the leading information provider for the global forest products industry. The company works with clients in the pulp and paper, packaging, wood products, timber, biomass, tissue and nonwovens industries to help them make better decisions.

Headquartered in Boston, MA, RISI operates additional offices throughout North and South America, Europe and Asia.

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SOURCE RISI

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