In a move that further underlines the attractiveness of forestry investments, according to AAA, the Pension Protection Fund is establishing a dedicated panel for forestry and agricultural investments.
Boston, MA, USA, February 13, 2012 — In a move that further underlines the attractiveness of forestry investments, according to Alternative Asset Analysis (AAA), the Pension Protection Fund is establishing a dedicated panel for forestry and agricultural investments.
The fund, which is worth well over $10 billion, has issued tenders for managers to sit on the panel, which will be dedicated to making decisions about growing and selling timber and investing in agricultural land.
This is just the latest in a line of panels that have been set up to concentrate on investing in alternative asset classes, which are becoming much more attractive as the stock market remains volatile.
AAA is a supporter of timber investment and particularly investment into sustainable plantation projects in developing countries. Its analysis partner, Anthony Johnson, explained, “As well as providing investors with the peace of mind that only comes with making ethical investment choices, investing in timberland can be extremely lucrative.”
Average returns from forestry investments have easily exceeded returns from equities in the past decade or so. In addition, anyone investing in timber has the added benefit of being able to sit on their investment and watch it grow if the market is not good when it’s time to sell.
“If timber prices are low when an investor’s timber stock reaches maturity, they can simply hold onto it for as long as they wish, in order to sell it when prices recover,” added Mr Johnson.
“In the meantime,” he continued, “their trees will grow by a further eight per cent per year, adding to the value of the timber.”
Most plantation schemes, like that run by Greenwood Management in Brazil, for example, grow non-native, fast-growing species such as acacia, eucalyptus and teak, that are popular for specific purposes such as the manufacture of charcoal or in the construction of homes or for furniture making.
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The remit of Alternative Asset Analysis is to analyse and provide news on the global performance of a wide range of alternative asset classes including, but not restricted to, commodities, real estate, forestry, foreign exchange, hedge funds, private equity and venture capital.
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