The Murray Region Forestry Hub (the Hub) has examined various issues relating to investment in new softwood plantations.
Despite indications that there are significant funds available to support investment in plantations, there continues to be a lack of investment in the region for the establishment of commercial scale softwood plantations. It was considered that the inability to derive acceptable returns from new plantation investments has been a significant barrier to plantation establishment. This report considers options for land ownership and models economic outcomes using consistent and comparable data inputs to determine potential returns on investments.
The intent of this report is to explore the extent to which financial returns available to private investors in softwood plantations can be influenced by Government policies.
Based on a simple financial model, this report assesses the different returns available from two alternative plantation land tenure options.
The results obtained under the ‘most likely’ scenarios for each land tenure options are presented below, with the same values for key variables being used for each option.