Sale of farms still ran­kles

Four farms bought in 2012


The over­seas in­vestor be­hind the con­tro­ver­sial $5.69 mil­lion pur­chase of four East Taranaki farms in 2012 for forestry devel­op­ment ex­pects to make $253m when they process the trees in 25 years.

Ap­proved by the Over­seas In­vest­ment Of­fice (OIO) in April 2012 the sale of the four prop­er­ties still ran­kles with some Whang­amomona farm­ers who wished to buy the prop­er­ties them­selves and claimed the com­mu­nity would be de­stroyed by the new land use.

That they have still not met the uniden­ti­fied buyer, who has links to both Aus­tria and the United King­dom, is a sore point as two of the prop­er­ties are be­ing leased back to farm­ers and re­main un­planted more than two years since they were sold.

How­ever, Rob Web­ster, of NZ Forestry Ltd, which is man­ag­ing the project that will see the back- coun­try farms planted in wal­nut species and Cal­i­for­nian red­woods, said ev­ery­thing was pro­gress­ing as planned.

‘‘ It is pro­gress­ing in line with ex­pec­ta­tions. In fact, over the past cou­ple of weeks two of our staff have been in the Whang­amomona/Ta­hora area man­ag­ing this year’s es­tab­lish­ment op­er­a­tions, which will con­tinue for the next week or two,’’ he said.

In the in­vestor’s ap­pli­ca­tion to buy the land it was stated they would spend $600,000 on land prepa­ra­tion in the first five years af­ter pur­chase, $2.8m on forestry es­tab­lish­ment in the first four years, $4.39m in the 28 years af­ter pur­chase in tend­ing to the forests and $5.4m over 39 years in main­te­nance, in­sur­ance, man­age­ment and ad­min­is­tra­tion.

They have also com­mit­ted to spend between $40,000 and $50,000 by 2016 on 4.1km of horse tracks and 6.4km of bike trails through the forests.

The in­vestor ex­pects its first round of har­vest­ing to pro­duce a sawlog pro­duc­tion vol­ume of 1,555,000 cu­bic me­tres.

Fifty per cent is likely to be ex­ported in log form and the rest pro­cessed in New Zealand.

To­tal rev­enue, af­ter ex­penses, is ex­pected to be $253m, with har­vest­ing planned to com­mence in 2037.

Web­ster con­firmed it was the in­vestor’s long-term plan to live in New Zealand but it would prob­a­bly not be in Whang­amomona.

In its de­ci­sion to al­low the pur­chase the OIO es­ti­mated the deal would gen­er­ate an ex­tra 4.5 full­time equiv­a­lent jobs than if the land con­tin­ued to be used for sheep and beef farms.

They also es­ti­mated the op­er­a­tion would re­turn a per hectare pre-tax profit of $220 to sheep and beef’s $86.

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