Tag Archives: latvia
Latvian Forestry Earnings Up, Despite Drop In Sales Volume
A reduction in the logging of state forests throughout the last 12 months has led to a fall in the availability of Latvian logs, which has caused prices to rise. Traditionally, UK markets have attempted to resist paying inflated amounts, but with supply declining steadily, they have been required to follow other countries in doing so, the Timber Trades Journal reports. In 2012, there was a 12 per cent reduction in the volume sold by Latvian State forests (LVM), but earnings climbed higher as a result of increased prices and improved efficiency. Heavy snowfall was a feature of the harsh recent winter and in December, around 200,000 m3 of the country’s woodland was removed due to the damage caused. However, this led to a €2 million investment from LVM in new acquisitions of private sector forests, resulting in the addition of an extra 1,500 hectares. In the UK, there has been “stronger-than-expected” demand for Latvian plywood, with customers believed to be making preparations ahead of the typical summer mill closures, which have seen production cease until the second week of August. According to the report, inventories are said to be at extremely low levels as large amounts were sold prior to the July closures. UK stocks are also believed to be minimal and Latvian mills have typically extended lead times to between ten and 12 weeks. Prices for plywood produced in the country increased in May and a further rise of as much as five per cent is expected when production restarts. The situation in Sweden is much the same, with a shortage of the sawlogs required by independent mills leading to a surge in prices. Swedish softwood exports to Europe declined by 11 per cent year-on-year in the first four months of 2013, with redwood exports falling by 15 per cent. Meanwhile, trade in Asian markets has risen, with redwood exports to Japan up by 18 per cent and those to China nine per cent higher over the same period. HD FestForest provides forest management in Estonia, Latvia and Lithuania and is a subsidiary company of HedeDanmark. Continue reading
Global Trade Of Wood Chips Has Soared Over Last Decade
18.06.2013 There has been a steady increase in the trade of wood chips globally over the last ten year, with imports reaching record-high levels in 2012. This is according to the Wood Resource Quarterly, which reveals that Japan, China, and Turkey were the countries with highest import levels, while Japan and China were responsible for 83 per cent of all hardwood chips traded last year. It has been suggested that this is as a result of significant investment in pulp capacity in the country. Over the last decade, traded volumes of wood chips have increased every year from 2000 to 2011, apart from in 2009 when demand for wood fibre was reduced and global production of pulp fell by around ten per cent. Between 2009 and 2012, the amount of chips traded increased by 6.5 million tonnes, taking the total to more than 31 million tonnes, with a value of more than $5 billion (£3.2 billion). This figure is slightly below the all-time high reached in 2011. In addition to the increased demand in China, Turkey has also contributed to the rise in chip imports as a result of the expansion of its production capacity for MDF. Although Japan remains the largest importer of wood chips in the world, the other nations making up the top ranking list have changed dramatically over the last five years. In 2011, Japan imported 11 million tonnes, down from a record high of 15 million tonnes in 2008. Whereas it was a net exporter a decade ago, China is now the second largest importer globally and is expected to continue to increase the volume of chips it brings into the country. Along with the expansion in pulp production, there is a distinct lack of domestic fibre sources in China and so its reliance on imports is increasing year after year. According to the report, China will overtake Japan and become the world’s largest importer of wood chips within the next two to three years. Japan and China are a long way clear at the top of the leaderboard for global wood chip trade, particularly in terms of hardwood chips, as the two countries were responsible for 83 per cent of the world’s total imports of the produce in 2012. Finland – the world’s third largest importer of wood chips – has been required to trade with Estonia, Latvia and Lithuania in order to meet its forestry-produce needs and this level of business has steadily increased in the last few years. According to the Wood Resource Quarterly, global trade of wood chips is expected to continue to increase in the coming years, largely because the main countries that are expanding their production capacity – particularly China and Turkey – have very limited natural resources domestically. Furthermore, a number of forestry companies are choosing to expand their sources for supply and import wood chips as an alternative to obtaining local fibre supplies. As a result, it can expected that those countries with expanding forestry industries will continue to experience solid trade growth in related produce. HD FestForest provides forest management in Estonia, Latvia and Lithuania and is a subsidiary company of HedeDanmark. Continue reading
New Forestry Investment Fund Launched
29.05.2013 A new fund has been announced that will focus on investment in forestry assets across Europe. The ForestCare Investment Fund is set to be launched by Diapason Commodities Management, which is a signatory of the Principles for Responsible Investment initiative and as such follows the guidelines relating to fiduciary duty. As a result, investments will cover forest properties and activities resulting from the industry, including forest management, wood production and processing. Furthermore, all potential investments will be subject to stringent checks with regard to sustainability, in particular their environmental, social and corporate governance impact. However, the fund will not restrict itself in terms of the type of investment, taking a number of assets into considerations, including equities, bonds, forest plots and all related derivatives. In an effort to take advantage of the comparatively low levels of private forestry ownership, ForestCare will include plots or land leases covered at least partially by forests exclusively in Europe. Forestry properties will form one-fifth (20 per cent) of the entire portfolio. On top of taking ownership of and managing forests across Europe, the fund will look to invest in shares or bonds of companies already operating within the forestry industry, providing they are doing so responsibly. Related derivatives and other investment opportunities within the forestry sector will also be considered, including biodiversity credits, carbon credits and REDD credits, which relate to efforts to mitigate the effects of deforestation. Mark McDonnell, managing director of Diapason Commodities Management, said: “ForestCare is a completely new way of approaching investment in forestry and with our approach to biodiversity in forests this investment opportunity has forest sustainability at its core.” “Crucially, the fund is structured to reconcile economic profitability with the need to make intelligent use of natural resources – providing investors with a diversified portfolio which is uncorrelated with other asset classes,” he added. Designed for those looking to invest in pension funds and institutional investors, ForestCare will have a minimum investment of €125,000 for the A class and €1 million for the institutional or I class. HD FestForest provides forest management in Estonia, Latvia and Lithuania and is a subsidiary company of HedeDanmark. Continue reading
