Buying trees : risks

We work hard to ensure the success of your investment

Any investment opportunity implies a degree a risk, which the investor must analyse and evaluate. Below are some of the risks faced when purchasing your trees and where appropriate, the risk mitigating factors.

The eventual return and profitability of a reforestation programme depends upon the future selling price of the timber, which in turn, depends upon demand. Timber is a commodity that is rising in value and showing no signs of stopping. There is increasingly less timber available in the world so you will be the owner of a commodity in increasing demand. The International Tropical Timber Organisation (ITTO) has reported and average increase in Teak prices of 8.5%+ over recent years.

Your trees will be looked after by professionally trained forestry experts who will ensure that everything is done to protect the health and growth of your trees. The area in which we are working is ideal for the tree varieties we work with.

Reduced timber production volume due to natural phenomena such as draught, storms or high winds is possible. Our production estimates are, however, in line with other plantations. Latin America has many years of experience in plantation of species including teak and mahogany.

Risk of financial loss from fire or disease does exist. However, experience and studies suggest a loss no greater than 0.05% should be expected. The news media often reports forest fires and the great damage done. It must be remembered that these fires occur because of very dry conditions and high winds. A tropical rainforest is, by definition, a humid wet place where such risk is minimised. Good management mitigates disease risk. Your trees will be insured against fire and disease at no extra cost to you. GGF is able to do this because of the low risk and subsequently low premiums.

Green Gold Forestry will replace any of your trees lost, for whatever reason, in the first three years.

Peru is probably the most stable country in South America. It has a healthy economy, many foreign investors - of which the UK is the largest, low inflation and a democratic government which is highly respected around the world.