(BusinessDesk) – New Zealand forest growers, long overshadowed by booming returns from the dairy industry, look set to cash in on record prices for logs as they prepare to harvest trees planted in a flurry of activity two decades ago.
Forestry plantation activity in New Zealand jumped between 1992 and 1998, as a surge in Asian log prices lured investment syndicates to the sector. Radiata pine, which makes up about 90 percent of the nation’s plantations, are typically felled between 26 and 32 years, meaning the “wall of wood” will start being harvested from about 2018, according to government figures.
Rising prices for forestry products, the nation’s third-largest commodity export, have been overshadowed in the past year by a rapid rise in the fortune of dairy products, with overseas sales of milk powder, butter and cheese worth more than three times as much as sales of logs and wood. Still, forestry has been the quiet achiever, with the ASB New Zealand forestry index and the forestry sub-group of the ANZ Commodity Price Index touching record highs in January. . .
With forest products exports continuing to enjoy a run of high commodity prices there is plenty of attention worldwide on the robust returns delivered from forest resources. So it’s timely that New Zealand and Australia are soon to host a major forest investment and market outlook conference series. The event in it’s third year is popular with forest company CEOs and financial sector leaders for it’s insight.
One of the keynote speakers headlining the FIEA event is Kevin Mason, Managing Director and Senior Analyst of ERA Forest Products Research (www.ERA-Research.com), a Canadian-based independent research firm that covers the global forest products sector.
“We focus first and foremost on understanding the commodity side of the market,” says Mason, “as trends in the underlying commodities far outweigh managerial abilities, or the lack of.” . . .
Bog Roy story one of challenges down through generations – Ruth Grundy:
It is fair to say farming Bog Roy station has put each generation of Anderson family to the test.
It is also true to say their dogged determination to face down the challenges thrown at them is testament to their love and vision for the land.
Dave Anderson is the fourth Anderson generation to take on the high country run. . .
A new ‘hands on’ initiative, which brings the classroom into the orchard, is helping combat the labour shortage in the horticulture industry.
The Eastern Institute of Technology (EIT), Work and Income and local iwi have teamed up with John Bostock, owner of JM Bostock Ltd, to help get people off the unemployment benefit and into permanent employment.
The partners have worked together to establish an EIT level three sustainable fruit production course, which has both theory and practical modules. The theory mirrors the orchard cycle to enhance the student’s learning. In 2014 the programme will start earlier in the year to better coincide with orchard practice. . .
Mutton exports from New Zealand rose significantly in the first quarter of this season.
Beef and Lamb New Zealand has released statistics for lamb, mutton and beef exports for October, November and December 2013 – the first three months of the 2013-14 meat export season.
While there was little change in the volume and value of beef and veal exports compared with the corresponding period last season, mutton exports were up 16.3% in volume and 22% in total value.
The average return increased by 4.9% to $5200 FOB per tonne, Beef and Lamb said. . .
Canterbury farmer Sam Zino is well on the way to showing that deer farming is a viable alternative.
The region’s deer focus farm facilitator, Wayne Allan, said Mr Zino had achieved most of his goals and had increased production and profit at a time when the venison price was falling.
Mr Zino and his brother, Mark, were selected as the North Canterbury deer focus farm in 2011 for three years. At the time, Mr Zino said he wanted to demonstrate that deer farming was profitable.
”What Sam has shown is that if you’re smart about it and you take a planned approach then deer farming can be a highly economic land-use option,” Mr Allan said. . .
The dairy land price paid per kg of milk solids has broken through the $40/kg mark and it is being predicted to keep on climbing with land value rising by up to 9% in the coming year.
At an average of $41.50/kg, this is a 12% lift on the post global financial crisis average of $37.
Commentators in the February ANZ Agri Focus say looking back through history, the $40/kg has been an important psychological level.
It also suggested land values could have started to enter over heated territory when assessed against historical returns. . .