Regional profile: Investing in sustainable forestry in Australia and New Zealand

Australia and New Zealand are two of the world’s most stable economies. The plantation forest industry is over 100 years old in both countries, with each having well-established plantation management capacity, operating history, infrastructure, and markets. Strong domestic and export demand for timber, including to growing Asian markets, combined with the alignment of the forest sector to decabonisation, mean the potential for compelling investment opportunities.

Investment opportunity – diversified timber markets and growing carbon value

Australia and New Zealand offer favourable growing conditions, climates well suited for primary production and a stable infrastructure and regulatory environment. Both have predictable timber supply characteristics with well-known productivity and operating conditions and provide exposure to two core markets that have a strong long-term demand outlook:

  1. China, India, and Southeast Asia – These are some of the fastest growing and most dynamic markets in the world, and they provide a market for almost all of the Australian hardwood woodchip exports and New Zealand softwood log exports.
  2. Australian construction industry – Australia runs a chronic deficit of structural softwoods for its domestic construction industry. For over 20 years, Australia has had nearly continuous economic growth, and with little or no new softwood plantations, this deficit is expected to continue to widen over the coming decades.

Delivering on Sustainable Development Goals

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