Who owns Victoria’s plantation forests?
Companies are increasingly recognising the value of plantation forestry in building green credentials. See the biggest land owners in Victoria’s plantation industry.
The total area planted to forestry in Victoria has declined by about 10 per cent over the last decade, while global players are strengthening their hold on the market, analysis by The Weekly Times has found.
Victorian commercial plantations, which cover the largest area of any Australian state or territory, were badly affected by bushfires in recent years, and have shrunk from 430,500 hectares in 2009-10 to 386,600ha in 2019-20, according to data collected by the Australian Department of Agriculture, Water and the Environment.
But global companies are increasingly recognising the value of forestry assets in building their green credentials.
A number of companies reportedly showed interest in the 24,000ha Green Triangle Forest Products estate sold last year, and the successful buyer – new entrant to the market, France-based AXA Group – named the purchase as a key asset in the company’s decarbonisation strategy.
The Weekly Times has compiled a list of some of the biggest land owners in the Victorian plantation industry.
OneFortyOne
OneFortyOne Plantations has the largest share of plantation area in Victoria’s largest forestry region – the Green Triangle, which straddles the Victoria-South Australian border.
OneFortyOne, named after the 141st meridian east line running between the South Australian and Victorian border, bought harvesting rights to South Australian state-owned plantations for $670 million in 2012.
It manages 95,000ha of forest, including 81,500ha of plantation forest, and the Jubilee Highway Sawmill in Mount Gambier.
The company is 64 per cent owned by Australian super and sovereign wealth funds and 36 per cent US pension and other offshore funds, according to its 2020 annual review.
Hancock Victorian Plantation Holdings (HVP Plantations)
Hancock Victorian Plantation Holdings (HVP Plantations) manages more than 240,000ha of land spread across southern Victoria, including 165,000ha of pine and eucalypt plantations. The estate includes land in Gippsland, western Victoria and large plantations in the north east of the state. The company is also involved in a joint venture – Softwood Plantation Exporters – in Geelong.
The company, managed by US-based Hancock Timber Resource Group, is owned by a combination of Australian, Canadian and US superannuation and investment funds.
New Forests
Fund manager New Forests has substantial interests in the green triangle region. It manages funds that part-own the second largest pine plantation forest in the Green Triangle region (Penola Plantations), and a second fund which owns a sawmill based in the region that processes structural sawlog (Timberlink Tarpeena).
New Forests is a forestry investment manager headquartered in Australia which also operates in New Zealand, Singapore and the United States.
Australian Bluegum Plantations
Australian Bluegum Plantations operates a plantation estate of 44,000ha in Victoria, 10,000ha in South Australia and 31,000ha in Western Australia.
ABP also operates a port facility in Portland, which it uses to export woodchips to Asia.
ABP is owned by US-based Forestry investment giant Global Forest Partners LP, a forestry investment adviser that manages about US$3 billion (A$4.09b) in forestry assets and 700,000 hectares of timberland worldwide, according to information provided to the Australian Competition and Consumer Commission in 2020.
AXA Investment Managers
Investment house AXA Investment Managers took control of 24,000ha of pine plantations in the Green Triangle in July 2021.
The $775m purchase from US fund manager Global Forest Partners was the biggest timber transaction in the country since OneFortyOne bought harvesting rights to South Australian plantations in 2012.
The acquisition was the first investment in Australian forestry for AXA IM, which manages almost 60,000ha of plantations across France, Ireland and Finland.
“As an investment manager, we are also attracted to the benefit that forestry investments can offer in our pursuit of decarbonisation of our clients’ portfolios,” AXA IM head of Australian real assets Kumar Kalyanakumar said.
Midway Limited
Australian Securities Exchange-Listed forestry company Midway Limited, based in Geelong, produces wood fibre for Asian pulp and paper markets.
The company is in the process of selling off a number of its Victorian plantations.
In October it put 1600ha of blue gum plantations north of Melbourne up for sale to potential developers. The sale came after the company signed a contract to sell 785ha of land in the Upper Goulburn region of Central Victoria for $3.2m last year.
Midway’s first half FY22 sales revenue was down 39.6 per cent to $91.2m due to ongoing Covid-19 induced supply chain disruption, freight costs and power cuts in China that adversely affected pulp production and reduced demand for woodfibre by major customers
AKD Softwoods
AKD Softwoods manages more than 9000ha of radiata pine plantations in Victoria and South Australia, six sawmills and multiple log export locations.
AKD is equally owned by four founding family shareholders.
VicForests
VicForests is a state-owned business managing the harvest, sale, and regrowth of timber from Victorian State Forests on behalf of the Victorian Government.
The company harvests about 3000ha of Victoria’s eight million hectares of public land each year.
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