An overseas-owned forestry company bought more than 1,800 hectares of farm land in Northland in November, at a cost of $25.8 million, to convert into forestry.
An overseas-owned forestry company bought more than 1,800 hectares of farm land in Northland in November, at a cost of $25.8 million, to convert into forestry.
An overseas-owned forestry company has bought more than 1800 hectares of farm land in Northland to convert into forestry.
Kauri Forestry LP, which the Overseas Investment Office (OIO) says has 93 per cent Swiss ownership and 7 per cent German ownership, was granted consent by the office in November to buy six Northland properties covering a total of 1811.64ha of land for a combined $25,853,000.
The OIO also gave the company consent in November to buy properties in Masterton, Hawke’s Bay and Gisborne - 1086ha for a combined $10.65m.
Kauri Forestry LP was granted a standing consent under the special forestry test on March 22, 2021. This permits the company to buy up to 6000ha of land in up to 20 transactions. The latest acquisitions were the 18th properties bought.
Federated Farmers Northland president Colin Hannah has been frustrated with the farm-forestry conversion legislation for a few years, and believes that getting rid of so much productive land is not in the best long-term interest of the region, or the country.
Hannah said farming employs more people and puts more money into the local economy than forestry does, and once the farms are converted that employment, and money, will largely disappear. Any profits made from the forestry will be returned overseas to the investors.
Federated Farmers Northland president Colin Hannah doesn’t think allowing large swathes of Northland farmland to be converted to forestry is good for the region, or the country.
However, investment company Craigmore Sustainables, which manages the companies assets, said all the farms it had bought were beef farms and the forest would be harvested, which created more jobs.
CEO Che Charteris said the company did not convert dairy farms to forestry, and in fact ran some dairy farms, while also saying the farm purchases would add value to the country.
But Hannah is not totally convinced.
“A dairy cow returns about 300kg (of dairy produce a year) at around $7 a kg, so with about two to three cows a hectare you can see how much money would be lost to the local economy. If it’s a beef farm, it will have about 1.7 cows per hectare and each cow produces about 140kg (of meat) at about $6 a kg,” Hannah said.
“Research shows that every $1 spent by a dairy farmer goes around the economy seven to eight times, as it is spent again and again in local businesses, while for a beef farmer each dollar goes around four to five times. So that will be a lot of money that local businesses - selling farming equipment, vehicles, feed, even the supermarkets and grocery shops - will miss out on at a time when the going is already tough for them. And that’s just from the farmers themselves...
“We really need to be looking at what is the long term forestry future and where these logs will go in 25-30 years if they are for harvest. China, our main market, has been planting so much forestry of its own in the past few years so that market is likely to be gone by the time these trees mature so where will they go?”
Hannah said he expected the new Government - with all three parties saying they are there for farmers - to make things easier for people to farm, and allowing so much good farmland to convert to forestry was not helping the situation.
Charteris said the company’s forestry interests created jobs and that any Class Five land on its properties - the highest category of land - would not be used for forestry.
“We at Craigmore, as creators and operators of farms, orchards and forests. think the answer (to the farming versus the converting to forestry debate) is in the middle – that farming has more economic benefit on the better hill country and forestry has more benefit on the less productive country (due to climate, slope and even grass type) that is closer to port,” Charteris said.
“But the change in land use must be done properly – socially and ecologically. It is a chance to set things up for the future e.g. we have a policy of not planting material areas of LUC 5 land, and planting 30m each side of material waterways in natives.
“Also, there are other factors that need to be considered – such as community impact. Fortunately, forestry has been a long-dated and positive industry in Northland. But horticulture has a strong place too, and more public funding and support could be put into supporting the growth of horticulture training in the region. For example, we have established a 82ha kiwifruit orchard in the region on a dairy farm.”
The Northland property sales by Kauri Forestry LP consented by the OIO in November were:
■ Freehold interest in approximately 241.1003 hectares of land at 102 Aponga Rd, Purua, Whangārei
Sale price - $3,870,000
Vendor - Adrian Talbot Broughton, Greig Irving Alexander and RTT AB Limited, from New Zealand.
About 241.1003 hectares will be planted in predominantly pine. With a rotation time of 25-30 years.
■ Freehold interest in approximately 301.7186 hectares at 4586 State Highway 14, Tangowahine.
Sale price - $3,000,000
Vendor - Kelvin Bruce Rountree and Joanne Elizabeth Rountree, from New Zealand.
About 214 hectares will be planted in predominantly pine, 33 hectares comprises existing natives and 40 hectares is unplantable. Around 12.5 hectares will be subdivided and transferred back to the vendor. With an expected a rotation time of 25-30 years.
■ Freehold interest in approximately 482.8234 hectares at 398 Bull Rd, Kaipara.
About 410 hectares will be planted in predominantly pine. Approximately 30 hectares comprises existing natives and 25 hectares is unplantable. The consent holder is expecting a rotation time of 25-30 years.
■ Freehold interest in approximately 476.44 hectares of land at Ruarangi Rd, Mangapai.
Sale price - $7,480,000.
Vendor - Jane Elizabeth Anderson, Kenneth Robert Anderson and Anderson ECA Trustee Limited, New Zealand.
About 476.44 hectares will be planted in predominantly pine, with a rotation time of 25-30 years.
