Why are forest prices rising sharply?
Coming out of the health crisis, the attraction of nature is fully felt. The real asset side pleases in the face of financial market volatility. By ticking the right boxes of the ESG theme, the forest is attracting more and more new investors. The price of oak has risen sharply over the past two years. Institutions are now very active, as are individuals. There are very few offers in the face of high demand.
How much does a forestry investment bring in?
A forest yields an average of 1% to 3% per year. Beyond this profitability, it is necessary to take into account a tax incentive. If the owner undertakes to apply sustainable management for 30 years, the forest is exempt from three quarters of the IFI but also from inheritance tax.
How do you explain the soaring prices of wood?
This phenomenon is linked to several factors. The construction uses more and more wood, a material popular with users. The new CSR regulations also encourage the use of wood in buildings. The war in Ukraine is pushing prices up because that country is usually a major supplier. Strong demand comes from China… In this context, more and more forest operators are finding it difficult to obtain supplies.
Are cuts in a forest frequent?
Softwood rotation is estimated to be 30-40 years. For oaks, the lifespan is more like 80-120 years. The longer we wait, the more faults may appear in the tree. The average volume of growth of a massif varies from 1 to 5% each year, it depends on the species: a softwood is much faster than a hardwood…
What would you recommend to an individual wishing to buy a forest?
You have to be patient to find the right massif at a fair price. Once the rare pearl has been found, you must get help from a forestry expert who advises and guides the management choices. As part of a diversification of heritage, it is an interesting asset… We offer for sale 140 hectares of wood in Sologne for 2.1 million euros or a massif of 150 hectares in Burgundy offered at 3 ME. The firm also sells 150 hectares of agricultural land rented in the Oise at 1.6 ME…