During 1997 until the partial collapse in 2009, the plantation area in Australia grew from 1.1 million hectares (ha) to about 1.9 million ha, with Eucalyptus being the preferred species planted, according to WRQ. At that time, MIS companies managed about 75% of the hardwood plantations and 6% of the softwood plantations.
Since 2009, a number of MIS forest companies have gone into receivership, including the FEA Group, Great Southern Plantations, Environinvest, Willmott Forestry, and Timber Corp. There are reportedly a number of timber companies and investors showing interest in taking over the management responsibility of the MIS schemes, WRQ notes.
Unexpectedly, an investment company in the province of Alberta, Canada, recently announced it would acquire 240,000 ha of timber assets from the largest MIS company, Great Southern Plantations, WRQ further reports. The institutional investment company, AIMCo, which invests globally on behalf of pension and government funds, will partner with the Australia New Zealand Forest Fund. The new ownership may create a more stable long–term supply source for forest and energy companies in Asia.
According to WRQ, there is continued interest from foreign investors both to acquire pulp mills and forest plantations. The latest development is the Singapore-based pulp company APRIL, with pulp mills in Indonesia and China, which is considering the purchase of forest plantations and export chip loading facilities. The intention would be to export Eucalyptus wood chips to the company's pulp plant in Rizhao, China, WRQ says.
Plantation Eucalyptus log production in the first quarter of this year was significantly higher than the same quarter last year, WRQ continues. This development came at the same time as availability of roundwood and wood chips from natural forests declined substantially. Prices for pulp logs have not shifted much the past year in local currency, with plantation hardwood continuing to be about 24% higher for plantation wood compared with wood from natural forests.
Pine and Eucalyptus pulp log prices, in U.S. dollar terms, have climbed steadily in Australia for almost two years, WRQ says. Prices are currently the highest ever recorded since WRQ started tracking Australian prices in 1990. During the past nine years, Eucalyptus log prices have more than tripled, with only Sweden, Spain, and Germany currently having higher hardwood pulpwood prices.
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