Recently we had a visit from a senior research executive from a major international merchant bank. The reason for his visit was not obvious but our suspicion is that he was really trying to find out who owns, and how is the second level of major forests in New Zealand, being managed. He knew all about Kaiangaroa and Carter Holt and the other major forests because in the main they are owned by overseas investors. Many of these are clients of his company.
One standout comment he made was that he was amazed how “incredibly bullish” leading American and European investment managers were in forest investments in general and New Zealand forest in particular. That was not really a surprise since as far back as October 2003 we reported in our newsletters that in the USA timberland returns showed the best annual result during 1987 to 2000. And further the annual deviation (the highs and lows) was the fourth lowest of all investments.