Japanese firms target carbon credits with forestry fund
Friday 21 Jul 2023A cross-sector group of Japanese companies has invested in a forestry fund created by Japan's Sumitomo Forestry, aimed at eventually issuing carbon credits through forest management mainly in North America.
Sumitomo Forestry said that it had launched the fund, worth around $415mn, in June to manage forests on the east coast of the US and Canada, the west coast of the US and Latin America to create carbon credits. Eastwood Forests and SFC Asset Management, both Sumitomo Forestry group companies, will manage the fund for 15 years.
The fund consists of joint investment by nine other Japanese companies — refiner Eneos, utility Osaka Gas, postal firm Japan Post, shipping firm Nippon Yusen Kaisha, diaper producer Unicharm, financial firms Sumitomo Mitsui Banking and Sumitomo Mitsui Trust Bank and leasing firms Tokyo Century and Fuyo. It is unclear how much each company has invested in the fund.
The forestry fund is expected to generate around 1mn t/yr of carbon credits, which could be used for voluntary and compliance carbon markets, such as through increased forest management and afforestation. Sumitomo Forestry aims to buy around 130,000 hectares of forests with a high conservation value by 2027 to achieve carbon absorption targets, along with nature-based solutions.
Source: Argus Media
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