General Investment Types

Teak

Teak plantations have the potential for very attractive returns on investment. This is a high value wood with a strong global market, particularly in Asia. On good sites with proper management, these can be harvested at 20 to 25 years. Teak requires deep, well drained, rich soils for good results. Also require is a dry season of 3 months in order to develop the wood qualites most preferred.

Lands suitable for teak run from from Mexico through Panama in Central America, primarly along the Pacific side. Also in many parts of the tropical America, the most likely prospects from international investment likely to be Brazil, Ecuador, Columbia, and possibily Peru. Farms suitable for teak run in price from $700/hectare in some parts of Brazil and Columbia, through $2,000 to $2,500/hectare in Panama and Ecuador, to $4,000 to $5,000/hectare in Costa Rica.

Returns on investment can be 12 to 15% annualized.

Eucalyptus and Parica

There is expanding interest in fast growing species such as eucalyptus and parica not just for wood products, but for bio-fuels.

These species can be grown to a commerical size in as little as 6 to 7 years. Eucalyptus has shown good qualities for paper producting and charcoal. Parica, a native species of the Amazon forests, has excellent qualities for hardwood plywood.

Some of the best value of land for these species can be found in southern Para State and northern Tochintins State in Brazil. Good farms can be found for R$900 to R$1,200/hectare, or US$550 to US$750/hectare ($225 to $300/acre).

African Palm

Again with the growing demand of bio-fuels, a strong demand for palm oil makes plantations of oil palms more attractive. These become productive in 3 years after planting, and produce for 20 to 25 years until they become too tall to be economically harvested, and need to be replaced. During their productive years, at current market pricing, they are estimated to provide a net income of $1,000/hectare.

Good sites are similar to the tropical sites suitable for eucalyptus and parica.