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Australia Wide Timbers Project 2010 |
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Cash Rebate |
8.00% |
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Closing Date |
CLOSED |
| Minimum
Investment |
$18,182 (ex
GST) |
| Term of Project |
23-26 years |
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Research |
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Adviser Edge |
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ATO Product Ruling |
2010/15 |
Strength through Diversification |
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The unique Australian Timber Project with diversification of Geography,
Eucalypt Species, Timber Markets and Forestry Operators.
Blue Gum
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Blue Gums grown in the fertile and high rainfall areas surrounding Bunbury and Manjinup in WA |
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Genetically superior Eucalyptus Globulus selected for its rate of growth and quality fibre, for the export woodchip market |
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Woodchip covered by a purchase agreement from Marubeni Corporation of Japan and Nippon Paper subsidiary |
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Trees grown by the highly experienced WAPRES organisation which manages over 50,000 hectares of forests in Australia |
Sugar Gum
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Sugar Gums grown in the Green Triangle bordering SA and Victoria, one of Australia’s premier timber regions |
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Sugar Gums are native to the region and the provenance has been selected based on the results of extensive CSIRO trials |
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The trees will be grown for sawlogs and when harvested, converted into high value timbers such as floor boards and decking materials |
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Plantation Timbers are the exclusive forestry company for these plantations. They are specialist Forestry Managers in the Green Triangle region managing over 6500 hectares |
Red Ironbark
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Red Ironbark, an iconic Australian hardwood being planted where native Ironbark forests were once dominant |
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Ironbarks are highly drought tolerant and produce very durable and structurally superior red timber |
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The harvested trees will be processed into timber that will be used in extremely hard wearing and decorative flooring, fire resistant window frames and other purposes where the toughness and rich colour of the timber are valued |
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Stargrow Australia will grow the trees and also purchase them from the Grower. They specialise in the production of Red Ironbark timber for the domestic and commercial market |
Core principles
The Australia Wide Timbers Project has been developed by the experienced and successful WA Blue Gum Limited to promote a project where Growers can invest in a diversified mix of Australian hardwood trees.
WA Blue Gum has been offering small and focussed projects to Australian investors for many years and has a record of consistently providing significant returns to its Growers.
This project is based on three core principles of sound financial and plantation management.
Principle 1 -
Diversification – by building diversification into many aspects of the project, inherent resilience to adverse market conditions is created.
Three different species have been selected, Sugar Gum, Red Ironbark and Blue Gum (all native Australian eucalypt hardwoods). Sugar Gum and Red Ironbark are being planted in their native regions, which means they are well adapted to the local conditions. Blue Gums are being planted into the Bunbury/Manjinup region of Western Australia where the local soil and rainfall help create exceptional growing conditions for these trees.
Geographically the three different species are grown in plantations that are spread across the breadth of Australia. A single weather event such as drought will not have an equal affect on all three plantations.
Each species will produce quality Australian hardwood but the wood from each is destined for different markets, reducing the reliance on any one market. Blue Gum will produce woodchip that will be suitable for export to Japan, Sugar Gum produces light coloured timbers used in furniture, flooring and cladding and Red Ironbark produces red timber of exceptional strength and hardness and is used in building.
Principle 2 -
Three different specialist forestry companies.
To grow the trees Australia Wide Timbers have selected three different forestry companies who are each specialists in their own regions and in the growing of their particular species.
WAPRES is a large forestry company managing over 50,000 hectares of forests. They specialise in trees for the woodchip export market.
Plantation Timbers is a company based in the Green Triangle of SA/ Vic and has extensive forests under management for some of the largest timber companies in the world. They will be growing and managing the Sugar Gum plantations for the project.
Stargrow Australia is a firm that specialises in Red Ironbark timber primarily for the Melbourne building market. They will be growing the trees and offering to purchase them from the project to supply their own operations into the future.
Principle 3 -
Careful financial management.
The project is protected by the banking of fees to ensure they are available for forestry work.
In addition, a series of bank guarantees are provided by the contractors to ensure that funds can be drawn upon by the project manager in the unlikely event of a contractor failing financially.
Financial benefits and built in protections
The project has been designed with a series of special financial benefits and inbuilt protections for the Grower.
Eight anticipated cash flows.
Eight cheques to Growers from multiple harvests.
Due to the diversification of the species and the need for constant thinning of the sawlog plantations, it is anticipated there will be eight separate commercial harvests from the plantations, each coming in different years (the first in year eight and the last in year 22). Each harvest is expected to give a significant cheque to the Grower.
Fees collected in advance and banked.
Part of the Application Fee also covers portions of the growing and rental costs into the future.
These fees are banked and can only be accessed on the signature of the Responsible Entity (WA Blue Gum).
Bank guarantees.
For Plantation Timbers and Stargrow Australia the project requires them to lodge bank guarantees with the Responsible Entity against their performance of the work required. This ensures that the Responsible Entity will have access to the funds required to continue the project.
“Each species will produce quality Australian hardwood but the wood from each is destined for different markets, reducing the reliance on any one market.”
Fees Table
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Fee |
What's it for? |
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Application fee: $10,000 (incl GST) per hectare Minimum purchase of 2 hectares |
Covers the initial planting and tending costs of the plantation and the majority of the first 10 years rent and growing costs |
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Co-Contribution fee: $324.50 (incl GST and indexed to CPI) per hectare payable for the first 10 years of the project |
Covers the balance of the growing and rental fees required each year to operate the plantations |
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Tending, and rent fees after year 10: $397.62 (incl GST and indexed to CPI). These fees will be deducted from harvest proceeds where possible |
The ongoing costs of the plantations |
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Harvest and processing costs: Actual cost incurred plus a 4% management fee for the harvesting of Blue Gums and Sugar Gums. These will be deducted from harvest proceeds |
The work involved in harvesting, transporting and (where applicable) processing the trees to generate a return |
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Incentive fee: 15% of any net returns earned over the benchmark |
To provide an incentive to the Project Manager any net return earned by the Grower over the set benchmarks will give an incentive payment to the Project Manager of 15% of the excess earnings |
Disclaimer: The above information is a summary only. Please ensure that you read the PDS and Financial Services Guide in full before deciding to participate in the Australia Wide Timbers Project 2010. This document contains general securities advice only which does not take into account any person’s investment objectives, financial situation or particular needs. Before participating you should assess the suitability of the project to your needs and consult a professional if necessary.
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Simply download an Investment
Brochure/PDS above. It’s that easy!
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