Page 14 - FDMAsia NovDec 2024

12 MARKET BEATS NOV/DEC 2024 FDM ASIA | www.fdmasia.com

and construction sector have welcomed the pledges made hectares, 79 percent of which were located in Scotland, the
to fund new housing. report found.
The timber industry would like to have seen a greater The report also demonstrated a reduction in the average
emphasis on low carbon construction, which would favour sale price agreed for forestry at £18,600/ha (18 percent less

an increase in wood-based design. For speed and efficiency than the year previous).
in the new housing market, it is more than likely that timber However, this figure is purportedly distorted by the
frame off-site construction will expand through 2025, delivering disproportionately high volume of northern Scottish properties—
more eco-efficient units. which are typically lower in value due to the distance from
In the softwood industry, traders still see tough times core timber markets—considered.
ahead. Everyone is hoping that increased expenditure in The report also discovered a drop in the supply of commercial
new UK housing, infrastructure and construction will provide forestry available for sale across the board.
a stimulus to kickstart demand. Only time will tell if that aim In Scotland, the volume of land available for sale dropped
materialises. by 40 percent to 1,600ha, as availability of land suitable for

commercial forestry continued to tighten despite sustained
UK forestry sales down demand.
According to The UK Forest Market Report 2024, £95.4 million Pricing for land has, however, stabilised at around £10,000/
worth of forestry was listed for sale in the UK in 2024, which gross ha. Land marketed in England increased 92 percentto
constitutes a 55 percent decrease on the previous year’s figures. 1,600ha, at an average £14,500/gross ha, which is 13 percent
The report was composed by Building Sustainable Worlds less than 2023’s value. In Wales, planting land also increased
(BSW) Group’s Tilhill Forestry, and Goldcrest Land & Forestry by 92 percent, to 1,300ha, with the average price per gross

Group. Head of Forestry Investment at Tilhill Forestry, Xander hectare valued at £16,800, which is up 26 percent up from
Mahony, commented: “This year’s report shows a resilient yet last year.
evolving UK forestry sector, where, despite investor caution, The report acknowledges that while Sitka spruce remains
there is strong demand for quality assets." the most popular species at market, more specie diversity as
“Stable timber prices, recovering interest in natural capital well as improved silviculture is required to ensure industry
projects, and the rise of biodiversity regulations are driving longevity, as the sector faces increasing environmental challenges.
growth.” “Interest base rates seem quite settled around the five
44 forestry properties numbering a total 5,400 stocked percent mark for now but if forecasts for lower base rates
become a reality, forestry could be increasingly attractive,”
Alan Hun the report said.

With greater political certainty after the budget, the report
also forecasted plenty of opportunities in 2025, with several
high-value properties expected to come to the market.
The documents also reported that projects with ecological
benefits, such as biodiversity and water quality improvements,
achieved two to three times higher prices for carbon credits

than standard rates, highlighting the demand for sustainable
land investments.