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Timber as an Investment

“Indeed, as an asset class, timber – a renewable resource with constant product demand – stands out as a remarkably stable investment.”

Bloomberg Wealth Manager

Now you can invest like the world’s wealthiest 1%
Timber can be a great investment on its own as well as an important diversification in your portfolio.
Timber is not correlated with stocks and bonds and is positively correlated with inflation. This means that when stock and bond markets move it has no effect on the investment returns of timber.
As inflation increases, it makes the cost of lumber higher increasing returns where inflation typically is bad for the investment returns of stocks and bonds. Timber investments have had a high rate of return with less risk than stocks.
Over the last 40 years timber investments have returned 13.3% versus an 11.6% return for the S&P 500 index over the same time frame  (Timber!, Smart Money, October 11, 2001)
Timber has historically risen 3.3% over the rate of inflation (The Investment U e-Letter: Issue # 401, Friday, January 7, 2005)

Belize Hardwoods is a US based company with strategic investment locations in Belize. Our well trained and experienced staff has unique skill set allowing us to be successful in not only the US but in the local markets in Central America as well, specifically Belize.

How it Works

Getting involved in a lucrative exotic timber investment opportunity had been historically reserved for only large corporations or extremely wealthy individuals. This is primarily due to the overwhelming costs and maintenance of growing plantation trees. Our investment model allows you to reap the same benefits as these wealthy investors without the large capital outlay.

You can now purchase individual trees by the acre and maintain full ownership rights to the trees. Each tree you purchase is marked and GPS tagged so you can track each individual tree from purchase to market. Since we maintain the entire plantation, consisting of your trees as well as the trees of other investors, you benefit from the overall commercial value and lower maintenance costs of the entire plantation. Again, allowing you to enjoy the benefits of a large investment opportunity without the risks.

Our planting process allows for a 20-25 year final harvest (depending on the species Teak is 20 while Mahogany is 25). Since you own the trees and they increase in value each year, you can keep your investment for the full term or sell your trees at any time. Obviously the value of a fully matured tree is higher than that of a 10 year old tree but having the option of “cashing out” on your investment at any time is certainly attractive in its own regard.

Your Investment Guarantee

We guarantee all our trees for the first 3 years after planting. If anything happens to them within that period we will replant for you at NO cost. With this guarantee you cannot lose your initial investment if your trees die or become diseased. Teak is one of the heartiest species of trees and is very resilient to insects and diseases, once fully rooted even fires won’t damage them. However it does take upwards of three years until they are fully rooted.

Investment Model

The return on an investment (ROI) in wood depends on a combination of two factors:

#1 Value of the Trees

 

The first is the Increase in value of the trees at (6 %) per year due to the biological tree growth. The trees grow quickly and become more valuable each year they age. As a natural commodity, your trees grow every year, and therefore their value keeps increasing. Natural tree growth means that the volume of wood increases regularly by up to (6 %) each year.

#2 Rising Price of Wood

 

The second is the increase in value each year due to the rising price of wood. Wood prices have been rising steadily for years – at a much higher pace than interest rates. Assuming a moderate increase in the price of wood of (5 %) per annum, it could result in a net return of around (11%) % per annum.

Grow Your Money

 

Highly prized for its beauty, strength and durability the demand for these hardwoods will always be rising. Your investment grows in two ways. The value of the final product grows with demand and the actual trees grow at the same time, making this a truly rare and extremely profitable venture. As you can see, at Belize Hardwoods, we truly do “Grow your money”

What We Do

We scout the perfect locations to grow the best long term investment crops primarily hardwoods like Teak and Mahogany.

Using our local knowledge and local skilled labor, our site selection and preparation is the first step in producing the highest quality and highest value investment products on the market. Without the ideal site selection and preparation, the end result may not be as desirable or valuable. This is just one of the many reasons why we can produce the most valuable hardwoods on the market today.

Commodity Charts

Historic Wood Values

 

According to the United Nations FAO publication ‘Forest Products Prices’, the median export/import prices of Teak actually rose at an average rate of 9.7% per year for 18 years from 1970 to 1988 (the last year of the report), and 13.2% per year for the last four years of the report. Teak prices have been rising at a rate greater than the 6% used in these projections.

Recession Proof

 

Since your trees only get more valuable with age they have a strong resistance to recession. Although the hardwood prices rose an average of over (7%) annually you are not forced to harvest at any particular time. Unlike other crops like cacao or coconuts that need to be harvested when ripe, you can harvest your trees based on the best particular time in the market.

Selling Trees Commands a Higher Price

Hardwoods like Teak and Mahogany are highly valued for several reasons. They are in very high demand and are becoming increasingly rare. This high demand versus short supply keeps the value increasing at a rate of over (7%) annually. As the world’s population increases so does the demand and with most of the “old growth” timber already exhausted the demand and value keeps rising. Hardwoods are valued and graded on a scale. Without the ideal growing conditions and care the final value is greatly reduced. Many growers use old citrus orchards or other previously cropped land to grow their hardwoods. Since the soil has already been depleted they need to rely heavily on commercial fertilizers to keep their trees alive. This not only has a negative effect on the

environment, but also a negative effect on the final quality of the harvested wood. Since we us only “virgin” “first growth” land, our trees have the highest yields and highest final value. The woods value is also dependent on the state in which it is delivered. A 20 year old “live standing” tree is still very valuable, however it still needs to be harvested and shipped to a buyer. We not only harvest the trees but also mill them on site to come out with a (rough sawn block). Were as that “live standing” tree may have a value of (x) the (sawn FOB) has a value of (y). Our expert loggers and mill operators have the knowledge and skill set to get the most dollars out of each tree. Although this seems like a simple way to increase the final value, other growers lack the experience and mills needed to perform these tasks

and you lose the money. With our ability to produce only top quality trees milled into highly prized pieces our overall project will help garner your trees the highest prices. With our initial estimates of over 1000 acres of hardwoods to be planted in the next few years, our supplies will be more than enough to capture the attention of market buyers. Most growers have only few acres of hardwoods available, and most have been planted years apart. When harvest time comes they have only a few M3 to bring to market. Although still valuable, they lose the power of commanding the highest prices. The global hardwood buyers would prefer to make one large purchase verses hundreds of smaller ones. This is just another reason our value predictions are well above the average hardwood grower.

Green Investing

Investing in hardwood trees is not only a safe and extremely profitable it’s also a responsible investment. Of course it’s important to see returns on your investing but doing so in an environmentally safe way is even better. Because the trees are so highly prized they have been illegally logged in many countries. Unfortunately, these illegal logging operations have little if any regard for the flora and fauna surrounding there target trees. Burning thousands of acres of habitat to harvest a few trees literally destroys the populations of many species of animals and vegetation. By investing in a hardwood plantation you are actually helping to stop the global deforestation that has been a plague on our world’s wild habitats.

When we prepare our land for planting we do it in the most responsible ways possible. We prepare the land by hand whenever possible, keeping the usage of heavy machinery to a minimum. Leaving wildlife corridors and migration trial areas undisturbed. Nesting boxes are built to help keep any birds undisturbed and flourishing. Creeks and rivers are left primarily in tact as to not disrupt the ebb and flow that has been naturally forming the land for thousands of years. Since old growth jungle actually releases more greenhouse gases (GHG) then it captures this truly is a green opportunity. Once under brushed and strategically cleared, the land is planted with hardwoods that capture more GHG’s then released.

Since these valuable hardwoods are not burned these GHG’s are stored indefinitely making it a sustainable and eco-friendly investment. We strongly believe that high value investment returns can be accomplished by working with nature making this a truly green way to invest. As the owner of Teak trees, you make an active contribution to protecting the environment, because every tree planted helps to improve the global carbon footprint and alleviates your conscience in the process. Six hundred and sixty-seven teak trees absorb some 22 tons of CO2 per year. This is equivalent to the CO2 emissions created by driving a car for 96,000 km at a fuel consumption of 10 l/100 km.

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