Seeing the wood for the trees, Reforesta Peru predicts great investment opportunities
in Peru's reforestation industry due to rising wood prices and the sale of carbon credits
The value of wood products imported into Peru, which were $830 million in 2010 and already three times the value of its wood product exports, could reach $2 billion per year by the end of the decade. The continued growth of Peru’s economy is pushing up demand for timber and imports could be reduced if there were a greater domestic supply from Peru’s forests, which are the ninth largest in the world and fourth among tropical countries.
In Peru, significant steps have been taken toward integrating its timber sector into the nation’s broader macroeconomic objectives of sustainable development. The country’s 13 million hectares of permanent production forests could sustainably produce exports worth up to $3 billion. Plus, an additional 8.5 million hectares of land is available for reforestation, according to Reforesta Peru, which is one of the leading forest companies in the country due to its proven record in quality and service.
“In the next five years our business vision is to manage large private investments in forest plantations to allow good economic returns for investors who trust us, based on sound environmental, social and financial principles,” says Enrique Toledo, forest engineer, founder and Executive Director of Reforesta Peru. “Simultaneously, we will continue to incorporate the world’s most modern technologies into our projects, and train 150 new professionals and technicians to strategically achieve a knowledge-based leading position.”
A private company that provides corporate reforestation services with social and environmental responsibility, Reforesta Peru designs and executes projects concerning forest plantations, biodiversity conservation, and environmental services through innovative financing, technology and business proposals. It has projects in the San Martin and Ucayali regions, and launched in 2008 with just three people. Today it has 74 employees and is made up of foresters, agronomists, business managers and field technicians.
The company has been contracted to carry out numerous studies of the quality of land suitable for forest plantations, and has selected tree species according to the land quality and business plan for each client. The plantations are created on the investor’s private property, ensuring that no conflicts exist with indigenous lands or protected areas. The main timber species used are: mahogany, cedar, teak, eucalyptus, and other native Amazon species. “We apply the best forestry practices in the installation and maintenance of the entire production process.
Our forest plantations are based on the application of 18 modern and efficient technologies, in particular non-transgenic improved seeds, high-tech nursery management, land preparation, planting, organic fertilization, weed and pest control, and the integration of the plantation into the modern and competitive timber industry,” says Mr. Toledo. “It is important to note that we are also dedicated to the recovery of degraded lands, conservation of Amazonian biodiversity, and the creation of eco-parks.”
Mr. Toledo believes that in 30 years wood will be scarce and expensive. Therefore, he says that investment in the future will be focused on replanting deforested land as well as the management of forest concessions.
Reforesta Peru produces and plants 1.2 million trees per year. “[Thanks to our engineering], we can produce 100% more wood compared to trees produced by conventional technology,” says Mr. Toledo, who has four decades of experience working on projects concerning plantations, agroforestry, and environmental services in more than 40 countries.
He adds, “We started out on the basis that forest plantations are big business: investments are profitable in the medium and long term. However we do not only develop innovative forestry technology. Our work also has a strategic importance regarding the payment for environmental services, specifically in the sale of carbon credits under the context of global warming, as well as in training new talented young foresters in the Peruvian Amazon.”
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