Taitokerau Forests a future model for investors?
Friday 27 Oct 2017A Maori development company with a one-off, 30-year forest rotation under its belt is basking in outstanding success but shutting up shop at the same time. Taitokerau Forest Ltd (TFL) directors have released a mission-accomplished report about the company set up in 1986 to enable Northland Maori landowners to develop forestry.
TFL chairman Rawson Wright then led a discussion about where-to-from-here for the scheme that provided sustainable land use and incomes in remote corners of Northland where otherwise there was little opportunity. "Once all the forests have been harvested the door is closed on this 30-year company," Mr Wright said.
Another injection of funding or joint venture investment is now needed to capitalise on the momentum and infrastructure TFL set up. That would pay for a second cycle of planting, wages, forest maintenance and ultimate harvest.
In its 30 years, TFL had repaid its initial, drip-fed NZ$31m loan government loan and interest, to the value of NZ$61 million, while paying for forestry development, management and wages on 14 Maori-owned blocks, totalling 4,300ha. The company made a return of NZ$11m for its shareholding landowners, with TFL itself taking no residual profits.
As well as that return and NZ$27m put into infrastructure and skills development, direct benefits included jobs, associated contracts and a guaranteed domestic timber supply (around 23 per cent of total tonnage from the blocks). Full time work hours chalked up equalled 66.5 fulltime local jobs - or to mirror forest rotation terms, 29 fulltime workers for 34 years continuously.
Less direct benefits were economic, employment and social development in remote, under-resourced communities, business and governance experience and a reduction in dole dependency. Accountant and TFL director Warwick Syers said the model enabled 'the most pure and economical development you can have on undeveloped land that is not being used.'
Some benefits would endure long after the scheme is wound up, the report by Business and Economics Research Ltd (BERL) said. Speakers at the debrief said the model was ripe for picking up by an investor or joint venture partner with the landowners. They said TFL had "flown below the radar" even while Maori economic and social development had been a topic of the times.
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