The minimum investment amount may vary depending on investment style and structure.
Roger Dickie New Zealand and Forest Management New Zealand encourage investors to participate in forest visits that are typically held annually around the same time as Annual General Meetings (AGMs). Separate access may be organised via the Forest Manager under a permit based system where the forest may be enjoyed in a safe manner.
RDNZ pays special attention to the investment structure including the impact of taxation on the investment. Forestry tends to be considered a tax efficient investment due to the way in which tax losses relating to forest costs of establishment, silviculture and ongoing administration can be held and offset against future incomes. RDNZ is not a tax professional and recommends that all investors seek professional tax and investment advice relating to their own circumstances.
The amount of carbon stored will depend on the size (weight) of the tree. Mathematically speaking, one tonne of green wood biomass is equal to one tonne of carbon dioxide or one carbon credit. One hectare of trees is likely to store around 500 tonnes of carbon dioxide at its ‘average’ age (age 16) and approximately 1,000 tonnes right before harvest. To put this in context, per capita NZ emissions rest around 7 tonnes per annum, so the ‘average’ carbon storage of a one-hectare investment is enough to offset approximately 71 years of human emissions.
A Radiata pine forest will tend to reach a mature and merchantable size around 24 years old and will typically exhibit strong growth and tree form through to 35 years. Optimal harvest is targeted at 26 to 28 years before the time value of money begins to inflect with growth rates.
Approximately 40% of New Zealand logs are consumed domestically and 60% are exported. Of the logs for domestic processing, the majority of this is used for construction purposes. Of the 60% exported, China takes the lion share to use mainly for construction and form work.
The percentage of wood exported and consumed domestically will depend on the processing capabilities of the region and the price paid for products. RDNZ endeavours to support domestic processing whilst maximising returns to its investors.
Investors wishing to sell their investment can first offer that parcel as a pre-emptive right to their fellow Partners (in the case of a Partnership) and then via a secondary market. RDNZ supports an active secondary market and if requested may help the Investor find a buyer for their investment parcel.
With respect to the Awatea Forest Fund, in addition to the secondary market, limited redemptions for Units are also available.
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