Investing in Timber

[fawtsc]

Cocobolo

Harvest year Bfpt $PBFt Revenue
21 years + 1 to market 225 $4.50 20,240
25 years + 1 to market 365 $6.50 45,068
Period 2008-2034 Total Revenue after 26 Years $65 308
Yield Before taxes 10.50%
Revenue per 100 trees


I could not get a single quote for anything younger than 21 years, the average was 60 years. Mostly due to the purpose of use of cocobolo for musical instruments.
The good news is that young cocobolo is getting strong apreciation and the price increases are above 10% ayear, in this case I might understimated by 5% to 10% the total revenue if the present pattern continues.
The revenue pbf has a nice add on, that is, the FAO has arrived to an agreement to protect the few cocobolo trees left in national forests areound the planet and kicking Mexico's butt for illegally harvesting cocobolos above their agree quota.
The plantation trees are getting a very good reception, the caveat emptor is that trees need to be 50 years to be consider for other thing more than planks. TAFT will only hold your trees until they are 25 years of age.
You can check Cocobolo specs at:
http://sea.unep-wcmc.org/forest/timber/workshops/reports/MA2005/Annex%202.pdf

As you might find is that Cocobolo needs to be above 50 years to comand full market value potential.