Forestry

Intelligent Partnership is pleased to publish an in-depth sector report on Forestry. This is part of the Alternative Investment Report series which are accredited by the CII and IFP for CPD purposes. The report comprises of a detailed investment case for forestry, demand and supply, investment considerations and potential in the sector. The comprehensive investment register at the end of the report is the only place where you can find information on all the opportunities in the sector available to retail investors. The register includes directly held forestry investments, investments with a corporate element and collective investment schemes.

An Overview of Forestry

Forestry as an asset class has been favoured by the wealthy for centuries as a sound store of wealth and a classic hedge against inflation. The sector has traditionally been way out of reach for the vast majority of investors, but there has been a surge of interest in the forestry sector since 2008 with a number of investment opportunities launched, making this asset class more accessible to ordinary retail investors. Investing in forestry can provide diversification from traditional financial products such as equities and bonds. The timber market is considered to be largely uncorrelated with traditional financial markets, and forestry has historically been a classic hedge against high inflation as the timber price and tree growth means that values generally increase with inflation. Some forestry investments are located in far off locations, with cheap land and weak land ownership laws and investor protections. However, not all of the investments in the sector are extremely high risk. There are some well managed and established collective investment schemes which offer investors access to established forestry assets in developed countries. With the right research and due diligence of products and providers, forestry investments have the potential to provide high returns and long-term security. This report looks at the global forestry sector and the investment opportunities that are available. The focus is on non-regulated, direct investments and lightly regulated UCIS schemes as these form the bulk of retail investment opportunities and are less well covered by the analyst community. Primary and secondary research has been undertaken, including a survey of some of the biggest product providers, in order to highlight opportunities and trends in the sector and be as accurate as possible. Further analysis has drawn conclusions and recommendations which point to the future of the sector as a whole.

Contents

• Introduction
• The Investment Case for Forestry
• Market Update
• Investing in Forestry
• Investment Structures and Regulation
• Research and Due Diligence
• Forestry SWOT Analysis
• Survey Analysis
• Investment Register Analysis
• Alternative Investment Register

Why is the Forestry Report relevant?

The report is aimed at advisors, intermediaries, sophisticated investors, SIPP operators, investment providers and other market practitioners who have an interest in the sector. The intention is to capture the current state of play: the drivers that are shaping the sector; the opportunities that are out there; changes in regulation; pitfalls to avoid and how to invest sensibly. As with all of the reports in the AiR series, we’ve also included a comprehensive investment register. We believe this is currently the only place where you can see all of the direct, non-regulated, and Collective Investment Schemes in the forestry sector gathered together in one place, allowing readers to do whole of market research. We’ve carried out our own analysis of the findings that can be drawn from this register and we’ve also surveyed some of the biggest product providers, allowing us to draw out some meaningful trends that point towards the sector’s future direction.

Registered subscribers of Intelligent Partnership can access a complimentary copy of the report here and claim CPD towards their member scheme; other interested parties can purchase a copy of our report here.

We hope you enjoy reading our report on Forestry and as always we welcome your comments and feedback.