NZFIL 3 Limited - Braemore
Planted 1995/6
Initial Share Price $5,200 (each)
Projected Harvest ~2024
There are currently no Secondary Shares available to Purchase.
NZFIL 3 Ltd owns 87.52ha of Braemore Forest Estate which is at the eastern end of Turakina Valley Road approximately 15km west of Hunterville, and 50km east of Wanganui. It is located approximately 195km from the port of Wellington and approximately 100km from Karioi, the location of the nearest market for pulp and a large sawmill. Other domestic saw mills in close proximity to the forest are located at Waverley (95km) and Fielding (60km).
The value of the tree crop owned by NZFIL3 Ltd as at 31 March 2023 is assessed at $1.819 million and is based on the growth of the tree crop to date and uses a projection of future log prices based on a return to average prices paid for the past 5 years. The market value of the tree crop is assessed by discounting projected future costs and revenues at a pre-tax discount rate of 7.5%. The discount rate is based on analysis of recent transactions in New Zealand. The methodology adopted is described in the New Zealand Institute of Forestry (NZIF) Forest Valuation Standards (May 1999). The Land component of the Investment carries a value of $220,755.
A forest inspection was undertaken March 2022. The tree crop owned by NZFIL3 Ltd at Braemore Forest is radiata pine. 74.7ha net stocked area and a tending status of 3 prune lifts to 6.8m, this is a slight reduction in forest cover as harvesting commenced in the forest in November 2022, when 4.8ha was removed ahead of harvesting activities beginning in earnest. Income from harvesting activity, $156k has been retained by NZFIL 3 Limited for future costs or to form part of the Dividend (if any) to Shareholders. The planted area was remapped against the ortho-photography dated on 15 April 2016 and the latest satellite imagery dated on 14 December 2020.
Based on the field observations from the field inspection, the estimated total recoverable volume and grade mix is 651m3/ha. Future costs are those associated with annual maintenance, fire protection, security, insurances, management, administration and the payment of Rates. Future harvest cost estimates are based on recent actual costs for similar operations in the Whanganui/Manawatu region taking account of the size of the forest, its terrain and the average tree size at the time of harvest. Using available topographic information its estimated 80% of the block will require harvesting by cablehauler, the balance being ground-based harvesting operations. Based on these assumptions, and in reference to the harvest costs and conversion factor databases for the Southern North Island region, the harvesting costs derived for use in this valuation based on our field inspection observations and after talking to the local contractors are calculated at $56.45/m3.
The following have had notable impacts on tree crop value:
· Export log prices have been very volatile due to the rising demurrage and shipping costs
· Harvest & load – has revised downwards and roading costs has revised upwards based on our field inspection observations and internal database
· Cartage costs – the unit rates have increased
Interesting times for NZFIL3 Ltd. The Forest remains healthy and financially able to deal with forthcoming costs. A Harvest Manager has been engaged to undertake the preliminary steps in harvest including; planning (2022/2023) for upgrading of internal roading and infrastructure at Braemore (2023/2024) and seeking Consent from Regional Council to harvest with a view to harvesting NZFIL3 Ltd during 2024/2025. NZFIL 3 Limited is indeed ready for Harvest and infrastructure has been upgraded to facilitate this. We received advice that the wood price was not ideal through the 4th quarter of 2023 and have delayed harvest. Bear in mind the trees are still growing and will continue to bulk up adding 5-8% more wood per annum. This will be reassessed during the Spring of 2024 and we'll post any updates upon this webpage, expect an update Spring 2024.
Due to the large number of both traditional mail & electronic mail being returned from Shareholders, NZ Forestry & Land Investments Limited will no longer issue TimberTalk Newsletters annually. We will update the information on this page annually, when available we’ll include new photos. If you suspect we have your old contact information, PLEASE use the Contact Us link above and send your current contact information through.
Updated April 2024.
Our Other Projects
Prosper Hills (2012) Limited
The Forest was inspected in April 2022 and found to be in good health and condition. Tree growth is good, with trees of good form and light branching.
Prosper Hills (2008) Limited
Prosper Hills (2008) Limited occupies part of Woodend Forest Estate which is located in the Mangapoike River Valley, the forest is about 85 kms south-west of Gisborne.
Prosper Hills (2006) Limited
The tree crop owned by Prosper Hills (2006) Limited at the Taipo Forest Estate is radiata pine, planted mainly in 1995. The Taipo Forest Estate is located in the Tinui Valley, about 58 kms north-east of Masterton.
Prosper Hills (2004) Limited
Prosper Hills Forest is located in Manawatu-Wanganui, approximately 37 kilometres north of Wanganui, conveniently located in relation to domestic sawmills in the Manawatu-Wanganui-Ruapehu Regions.