Report reveals progress of woodland growth

UPM Tilhill and property services company Savills have said the growing biomass market in the paper industry is having a positive impact on woodland values.

In its new 2008/09 Forest Market Report, the timber harvesting company has highlighted the progress of wood-fired plants at mills in Shotton, Teesside and Lockerbie, Tullis Russell and Drax.

It said they are beginning to generate a "real and sustainable" source of income for woodland owners.

The report also reveals plantation prices have on average more than doubled in the last five years.

It has found investors that have owned woodland over the last five years will be enjoying capital growth of 125-150%.

Average plantation prices have risen more than 100% in the last five years, with headline growth at 52% since 2006. Like-for-like prices have increased 10-20% in 2008 compared to 2007.

Simon Hart, woodland investment adviser at UPM Tilhill, said: "In a year which has seen oil prices reach record levels, the economy slip towards recession, and the nationalisation of three major banks, forest owners are really bucking the trend.

"The report shows how forests and woodlands can be seen as a safe haven in these uncertain economic times."

The report is an aid to buyers and sellers involved in the commercial forestry market, and provides an annual snapshot of the UK commercial forestry market.

UPM Tilhill is the UK's largest timber harvesting company, harvesting over 2m tonnes per year.

Savills advises on commercial, rural, residential and leisure properties. Its research department provides advice and analysis to clients across Britain and overseas, with specialists in the agricultural, residential, and commercial property sectors.