New report exhibits a record-breaking 12 months for the forestry market

The forestry market has seen a record-breaking 12 months, with common values greater than double what they have been three years in the past and the whole worth of the forestry funding market reaching a brand new excessive, in response to the newest UK Forest Market Report.

The annual report, produced by Tilhill and John Clegg & Co, is now in its twenty third 12 months and is considered probably the most complete publicly obtainable report of forestry transactions within the UK.

This 12 months it highlights that the sector is attracting unprecedented ranges of curiosity from business forestry consumers and monetary establishments.

Some are skilled forestry buyers, however others are new market entrants with a number of goals – half monetary and half associated to Environmental, Social and Governance (ESG) issues or pure capital outcomes.

The report exhibits that in 2021 a complete of £200.4 million of forestry properties have been traded, making it one other report 12 months for the sector.

This 12 months it features a new part available on the market for planting land, which exhibits an extra £53m price of land appropriate for afforestation transacted, plus £26 million price of pure capital land.

Key findings of the report embody:

• 21% enhance in forestry values from just below £16,000 per stocked hectare in 2020 to £19,300 per stocked hectare in 2021. Nonetheless, the unfold in costs paid is extensive, with important geographic and high quality variations;
• The whole worth of the forestry market was £200.40m in 2021 (simply over the £200.18m in 2020), with 70 planting land offers additionally struck price £53 million;
• 10,400ha (gross) of forestry traded in 2021 (67 forests), in contrast with 12,500ha in 2020;
• Lower in common measurement of a property offered from 206ha in 2020 to 155ha this 12 months;
• Scotland supplied largest share of economic forest market at 76% by worth.

Peter Chappell, head of forestry funding, Tilhill mentioned:

“It’s an thrilling time to be within the forestry sector.

“The optimistic long-term outlook for timber values has buoyed confidence in how business forests can carry out as an funding and the broader advantages of timber and woodland to society and the atmosphere are being more and more recognised.

“The expansion within the worth of a median stocked hectare has continued unabated, rising 21% this 12 months. This implies over the previous three years, values have risen from £9,300 in 2018 to £19,300 in 2021.

“The report additionally highlights how the development of youthful forests attaining the best unit values has continued into 2021.

This exhibits investor confidence in timber values, and the truth that youthful, second-rotation forests are typically characterised by excessive yielding, improved styles of Sitka spruce, with confirmed timber extraction and a developed infrastructure.

“There’s additionally some proof that bigger forests over 100ha are actually attracting the best per hectare values as an more and more aggressive market develops for prime worth offers.”