Forestry sharefarming

Press, 3 December 1982, Page 21

Forestry sharefarming

A pilot scheme for jointventure forestry in Canterbury has been approved by the Canterbury Forestry Foundation, say, the foundation’s directors in their annual report, to be presented to members at their annual meeting in Darfield on Monday. The scheme is similar to schemes, already in use in Otago arid Hawke's Bay. The landowner supplies the land and fencing, and pays the rates, while an investor meets the cost of establishing, tending, and managing the forest. “In the present economic climate many farmers who have marginal land well suited for forestry simply cannot afford to invest in a crop for which they will receive no return for up to

30 years," says the foundation. “Similarly, many investors who seek the long-term benefits of forestry as an investment cannot afford to pay high land prices which are now common.” Under the scheme the landholder and investor would share the final return on the basis of their relative cost inputs, which would be determined “to the satisfaction of both parties” before any agreement was signed. The board hopes to establish its pilot scheme within "management distance” of Christchurch, preferably in the foothills. It says the aims are to broaden its operating scope; and to provide income which will help to keep down

its charges for providing other services to its members. The scheme would also create “land-use alternatives” for its members. The initial scheme is for a target planting over five years of five blocks, each 20 ha, of marginal land suitable for forestry. The foundation says that costs to the investor would be about $6OOO a year for the first 15 years (before inflation). ' Relative shares in the final yield would depend on the value of the land, which would be “costed in” to the scheme as an annual rental. In other areas the landowners’ shares in joint-venture forestry had been determined as 35 to 45 per cent, which translated to between $5250 and $6750 per hectare on a projected total return 0f515.000 per hectare.