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US forestry research giant ArborGen - part-owned by NZX-listed forestry investor Rubicon - is putting millions of dollars into a partnership with Crown research institute Scion.
The three-year R&D agreement - expected to be the first stage in a long partnership - is aimed at improving plant fibres and wood properties.
The size of ArborGen's investment was not disclosed but Tom Richardson, Rotorua-based Scion's CEO, put it at under $10 million.
Richardson did not have figures for the revenue the research funded by the partnership might generate. But Scion hoped to get returns from it in five to 10 years and believed returns would be "substantial".
Richardson said the immediate benefit to Scion of the investment was it would help grow the CRI's research capacity. Also, knowledge gained from the research would directly benefit New Zealand forestry.
The partnership will seek to build expertise in "biomaterials", which include fibre products that can compete with the likes of plastics.
The research would help improve tree growth and quality for both commercial forestry and biomaterials, Scion said.
As part of the deal, ArborGen and Rubicon are giving Scion access to pine and eucalyptus gene databases.
Richardson believed plantation forests would be different in future with trees grown for a wider range of purposes, such as making ethanol or other bio-fuels, or with specific characteristics for manufacturing biomaterials.
Scion said a potential research outcome was to develop trees specifically for pulp and paper making, so less chemicals and energy were required.
Richardson said the fact New Zealand-based Rubicon was involved in ArborGen made the deal even sweeter for Scion as a CRI, as it meant more of the benefits of the deal would flow to this country.
"We're passionate about making forestry a bigger, more positive contributor to New Zealand and this [new research activity] is all about getting better forestry."
