Why invest in forestry?
Growing World Markets
World consumption of wood products is rising, especially in the Asia Pacific region. Improved standards of living and population growth will mean a greater demand for paper and wood based products.
Forestry is an asset class
An investment in forestry offers investors the opportunity to diversify into an asset class that is not correlated in terms of movements in market prices and returns with other asset classes such as equities and property.
Environmental Advantages
Plantations protect native forests, help reduce salinity and soil erosion and create a sink for greenhouse gases.
The Australian Advantage
With more than 700,000 hectares of hardwood plantation, Australia is well located to supply expanding Asian markets. Australia also enjoys a freight advantage over other countries with shipping taking up to 16 days less than some other countries.
Continued Government Support
The Australian Government encourages development of plantation forestry through its ‘Plantations for Australia: 2020 Vision’ statement.
Why invest with Elders?
Financial strength
Elders Limited is a Top 200 company listed on the Australian Securities Exchange (ASX). Elders Forestry Limited (Elders Forestry) has a strong mandate and backing to support its future growth. Elders Forestry manage investment assets in excess of $670M on behalf of more than 12,000 investors.
Industry Leader
Elders Forestry is one of the largest hardwood plantation managers in Australia with more than 160,000 hectares under management across Australia. Elders Forestry has been an industry leader in the establishment and management of plantations for more than 15 years and now manages more than 50 forestry projects.
Best practices
Elders Forestry has one of Australia’s leading, advanced generation eucalypt breeding and silvicultural programs. This work continues to be the subject of extensive trials with national and global collaborations to further improve the productivity of seedlings planted as part of their estate.
Benefits of the Elders Diversified Forestry Project
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1. |
Multiple cash flow points throughout the term of the project |
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2. |
Diversification across species, geographic locations and end markets |
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3. |
Deferred fee structure aligning Elders’ Forestry interests with those of investors |
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4. |
A single upfront payment option with no annual lease or management fees |
How the details stack up?
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Option 1 |
Option 2 |
| Establishment Fee |
$8,500 per unit* |
$7,500 + $500* per year for the first four years |
| Deferred Management Fee |
Thinning = 50% Clearfall Harvest = 18% |
Thinning = 50% Clearfall Harvest = 10% |
| Term |
21 years |
| End Markets |
Domestic and export markets |
| |
PULPWOOD |
RED MAHOGANY |
INDIAN SANDALWOOD |
TEAK |
| Area (approx) |
0.72 ha |
0.06 ha |
0.06 ha |
0.05 ha |
| Revenue Flows^ |
Year 11 |
Years 8 and 19 |
Year 16 |
Years 10, 15 and 21 |
| Species |
Eucalyptus globulus |
Eucalyptus pellita |
Santalum album |
Tectona grandis |
| Location |
The Green Triangle (VIC/SA), Albany (WA) and/or Esperance (WA) |
Far North Queensland |
Kununurra (WA) and or Far North Queensland |
Far North Queensland |
| End Use |
High quality paper and paperboard |
Appearance grade timber used in flooring and furniture |
High end perfumes, cosmetics such as moisturisers and soaps. The sawdust is used in incense. |
Decking, indoor/outdoor furniture and in boat building |
*$500 ongoing payment is adjusted annually for CPI
^Based on expected harvest commencement dates, harvest may continue over one or more financial years. |
Project Locations
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Project Species |
Project Locations |
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Sandalwood |
1 Kununurra |
5 Penola |
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Pulpwood |
2 Far North Queensland |
6 Esperance |
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Red Mahogany |
3 Hamilton |
7 Albany |
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Teak |
4 Portland |
8 Bunbury |
Environmental excellence
In May 2004, Elders Forestry became one of the first retail plantation forestry managers in Australia to secure Forest Stewardship Council (FSC) certification, as recommended by WWF-Australia, for our plantations in Southern Australia and in 2008 achieved FSC certification for all our plantations in Western Australia.
Elders Forestry is committed to securing FSC certification for all plantations.
Building on Elders commitment in securing FSC
certification, in December 2005, WWF and Elders
Forestry launched a partnership to encourage
Australian businesses to support responsible
forest and plantation management through the
choice of timber and paper they buy.
WWF-Australia congratulates Elders Forestry
for their world first FSC certified Sandalwood
plantations in Kununurra, Western Australia.
Important information:
This product summary has been prepared by Elders
Forestry Management Limited (ABN 55 081 643 147) (AFSL 247019) and does
not constitute advice of any kind. It has been prepared as general information
only, is not intended to be a recommendation to invest and does not take
into account the investment objectives, financial situation or needs of any
particular person. Before making any investment decision you should consider
the information contained in the Elders Diversified Forestry Project 2010 Product
Disclosure Statement (‘PDS’) and your individual circumstances (with or without
the assistance of an adviser) to determine if investment is appropriate for you.
Detailed information about the product is contained in the PDS available above. No person or corporation
associated with Elders Forestry Management Limited, Elders Forestry Limited or
Elders Limited guarantees the repayment of capital or the performance of the
project. Past performance is not indicative of future performance.
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