Latest News
Forestry Investment News
Timber funds travel to find specific portfolios
09/06/2010
Timber funds are increasingly targeting assets in countries like China and Brazil to build up significant market-specific portfolios.
Fund manager Liane Luke, speaking to IPE Real Estate, said existing investments in China were only giving her firm more confidence in increasing their assets there.
She said the purchase of the first asset in Jiangxi this year has spawned a "robust pipeline" of deals in China, and was opening eyes across the sector to investment in other timber-rich nations, including New Zealand, Indonesia and the countries of East Africa.
“The countries we invest in have vibrant export markets or they’re next to them,” she said. “You have operational risk, location risk and regulatory risk in every investment. In China and Brazil, yes, there’s market and political risk – and there’s a premium for it.”
She acknowledged that China work can be “hard going”, largely because of a lack of tradition of timber investment, but that the country also has a significant domestic market for the commodity. Annual lumber imports to China increased 40 per cent last year, with pulp imports increasing by 44 per cent.
Fund manager Liane Luke, speaking to IPE Real Estate, said existing investments in China were only giving her firm more confidence in increasing their assets there.
She said the purchase of the first asset in Jiangxi this year has spawned a "robust pipeline" of deals in China, and was opening eyes across the sector to investment in other timber-rich nations, including New Zealand, Indonesia and the countries of East Africa.
“The countries we invest in have vibrant export markets or they’re next to them,” she said. “You have operational risk, location risk and regulatory risk in every investment. In China and Brazil, yes, there’s market and political risk – and there’s a premium for it.”
She acknowledged that China work can be “hard going”, largely because of a lack of tradition of timber investment, but that the country also has a significant domestic market for the commodity. Annual lumber imports to China increased 40 per cent last year, with pulp imports increasing by 44 per cent.
RSS