A recent article in the Economist of May, 30th 2015, why investors who have backed forestry have seen positive financial returns that outcompete other financial instruments. The Bamboo plant was build, in parts, to overcome some of the barriers associated with traditional forestry investment and provide a triple bottom line investment that not only produces competitive financial returns for partners and stakeholders in a Tangible time frame. But delivers on quantified and independently accredited environmental and social benefits. If grown and managed sustainably, certified Bamboo plantations can not only provide an alternative fiber for timber dependent companies, but be a socially responsible investment.
Green-fingered investors in timber forests over the past decade did better, on average, than those who planted their cash in more obvious places, such as properties, estates, stocks and bonds. According to the World Annual Forestry Index, a sample of 133 commercial forests in USA and UK, forests returned 18.4% last year and have averaged a staggering 21% a year since 2010, easily outgrowing the FTSE 100 share index which returned an average of 7.7% and commercial property which made 10.9%.
Why the lush returns? For one, timber prices are on the up, making the land used to grow trees more valuable too. Though an irregular source of income, your average tree needs 30- 50 odd years to grow, timber sales alone account for returns of around 2-4% a year, according to MSCI, an equity-index firm. But the root of the forestry boom is overwhelming demand from investors who want to get their hands on land, says MSCI head of alternative investments. Most private forests belong to wealthy families who want safe places to store their capital, alternative sources of income as interest rates remain low and who (especially since the financial crisis) prize assets they can touch and sniff over paper promises.
Africa’s poorest and hungriest people are nearly all farmers, to lift themselves out of poverty, they must either move to a city or adopt better farming economics. The latter is possible because five decades ago it was one of the world’s greatest crop exporters. The World Bank estimates that food production and processing in Africa could generate US$1.0trillion by 2030 up from US$300.0 billion today. Yet many remain skeptical that Africa’s small farmers will achieve their potential. Instead of subsidizing steel, oil, and some other non-unsustainable industries, African nations should wake up and invest in the 21stcentury green steel, alternative wood, can replace iron, plastic, aluminum, rubber etc.
Investment in Bamboo trees have a triple take returns on investments. Besides early maturity with low gestation, Bamboo trees (scientifically, a grass) when harvested, regenerates copiously ready for the next harvest and lastly the farmer is entitled to collect carbon (sequestration) credits from corresponding institutions. In the economics of Bamboo investments a ROI in excess of 33.5% has been computed according to the narrative below.
In the economics of Bamboo Investments, the full length of a mature culm stem of O. Abyssinica is between 10-15m and up to 10cm in diameter. The culms are solid in the lower internodes, and hollow from the upper half to the top of the culm. A bamboo clump can yield up to 150 culms per year. Each culm can yield timber measuring 3×3 inches and 27 feet long. A clump of the solid bamboo can therefore yield 4050 feet of hardwood bamboo timber i.e (27 feet x 150 clums) per year. An hectare of land will take 600 bamboo clumps and a resultant total yield of 2,430,000 feet of hardwood bamboo i.e (4050 feet per clump x 660 clumps). One inch board (1’’x12’’x12’) of hardwood timber In a timber hard yard store in Amu Market, Lagos, Nigeria cost NGN2,500. The value of hardwood bamboo timber yield per hectare, per year is projected at NGN9.25 million. A wood processing machine (Linda) is sufficient for primary processing of bamboo into woodblocks. The cost of the wood making machine is NGN250,000 installed. It is run by three (3) operators earning NGN54,000 per month. We have simulated the cost of planting of one Hectare of Bamboo and the Returns on investment which comes to 33.5% in the 3rd year of investment, but goes on for the next 35-40years with minimal additional maintenance expenses. This is a boom to existing arable farmers as bamboo seedlings will be made available in a short while as well the markets for Bamboo culms (poles) ……
Bamboo in a class of its own, with over 140 uses and applications that outcompetes forest Timber trees or shrubs in both agronomic and economic returns. If u want to grow money, grow money on trees, grow Bamboos, eat Bamboos, wear Bamboos, and drink Bamboos.
Like to know more? Contact Mr. Bamboo on 08033560576. <bamboodevnet@gmail.com>
