COMPANY STRENGTHS
Africa's largest forestation company
Green Resources has established 20,000 ha of standing forest and has planted more new forest than any other private company in Africa during the past ten years. Planting increased 25% in 2010 to a record 6,000 ha.
Low-cost planting
Green Resources takes a direct hands-on approach to business and has small overhead costs. Its planting costs are among the lowest in the world, typically 25-50% of the main countries for new forest plantations. The cost of pruning and thinning, required to produce the highest value ‘clear’ saw and peeler logs, is the lowest in the world. High-cost northern timber accounts for 80% of world supply, while low-cost southern timber accounts for only 20% of world supply. The steep cost curve supports appreciating timber profits and land values in the south.
World’s best location for forestry
Mozambique and Tanzania are amongst the best places in the world to establish new forest plantations. Rainfall is good, and land and qualified employees are available. By utilising 2% of their land for forestry, Mozambique and Tanzania could each build a forest industry that is larger than South Africa’s and Green Resources aims to be at the centre of this development. East Africa is closer to the major growth markets of China and India than most of its competitors in Latin America and Australasia, and reaches the Middle East by a short back-haul shipping route.
Large available land areas
Green Resources has 536,000 ha of land in various stages of the land acquisition process, from village to district approval, including the two projects for world-scale forest plantations. This is a long and complicated process that requires heavy community involvement and firm demonstrations of Green Resources’ commitment. The company has a strong record of land acquisition, typically holding land on 99-year or 50+50-year leases. Green Resources’ strong organisation and good infrastructure is capable of managing large amounts of land suitable for forestation.
Environmental and social responsibility
Green Resources aims to conform to high environmental, ethical, financial and social standards. It has certified its oldest forests according to the Forest Stewardship Council’s standards and it manages all its plantations according to these principals. It aims to be the preferred partner for local communities, the national government and international development and finance organisations and has implemented large community development programmes.
Strong organisation
Green Resources has 15 years’ experience in African forestry and the carbon credit business. The company has built up a strong organisation of local managers and expats with a proven record of success in tree planting, carbon credits and industrial operations. Green Resources is the only major forestry company in East Africa with strong local plantation managers. The company is chaired by Juha Niemela, who was CEO for 10 years of UPM-Kymmene, Europe’s largest forest and paper company.
High-quality carbon credits
Green Resources has a unique position as a low-cost supplier of carbon credits from its forestation and bioenergy projects. It has registered the world’s first forest based carbon project according to the voluntary carbon standard (VCS), the leading standard in the voluntary carbon market and received the first revenue in 2010. In the long term the carbon credit revenues are expected to recover an important part of the planting costs.
Strong industrial growth
The revenues from the company’s industrial operations have grown by 30% per annum since 2005. New investments should ensure that this growth is maintained for several years to come, this will enable Green Resources to utilise a larger part of the trees and sell logs to higher paying markets (like electricity poles) and thereby maximise the value of the forest.
Local industry leader with secure log supply
Green Resources’ Tanzanian sawmilling and electricity pole operations at Sao Hill are the largest in East Africa. The company has a long term 300,000m ³/yr log supply contract from East Africa’s largest productive forest, which is located next to the mill.
Fast growing local economies
Green Resources operates in three of Africa’s fastest growing economies and most stable countries over the past ten years: Mozambique, Tanzania and Uganda. The Economist magazine forecast Mozambique and Tanzania to be among the world’s five fastest growing economies over the next five years. .
Strong lenders and shareholders
Green Resources is a customer of IFC and Norfund, two leading and demanding development finance institutions. Is has a wide range of shareholders, including the largest London Stock Exchange listed forest investment company, Norway’s largest pension company and three consecutive Chairmen of CEPI, the European paper producers association