Carbon Offset Schemes

Investment in Teak

Teak Plantations

General Outline:

It is well known that investment in tropical hardwood forests have been a proven high performer for many decades. Tropical hardwoods are in high demand and all signs are that this trend will continue for many years. Established and developing economies rely heavily on hardwood timber for a wide range of uses, and 1997 figures show a shortfall of 200 million cubic meters in world demand for this commodity.  Respected independent professionals affirm the wisdom of investing in trees, and recent concerns over global warming have added a further benefit to be derived from growing trees for carbon sequestration and helping to reduce global warming.

The world’s tropical regions provide the conditions for fast growth that make plantation returns considerably more viable than Northern European counterparts, where lower value species, such as birch or pine, take up to half a century to reach maturity. Conditions in the tropics allow for teak and other high value species to reach commercial maturity in 25 years, or less. A single teak tree, costing £10 to plant to-day, will be worth over £500 of to-day’s pounds in twenty years time. That is an increase in value of over 20% compound annual growth rate and a far greater return than most investments available to the public.

It is a known factor that trees absorb pathogenic carbon emissions. Contrary to popular belief, mature forests have been found in many cases, to sequester far less CO² than previously thought. Mature forests produce their own CO² from rotting vegetation and in many case the net sequestration is only a few tons per hectare. Growing forests, however, sequester large amounts of CO² and this can be over 3,000 tons per hectare. Broadleaf tropical hardwood species are thought to easily provide these rates of uptake - a typical 21 year old teak tree will have stored 1,037 kg of carbon and removed 3,801 Kg of CO² from the atmosphere just by growing. When a tree is burnt down for land clearance, or dies and rots, the carbon stored therein is released once more into the atmosphere.

So why isn’t everybody rushing to invest in tropical

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Investing in Tropical Timber to Offset Carbon Emissions