China Timber maps land acquisition spree

South China Morning Post

September 24, 2007 Monday

China Timber maps land acquisition spree

BYLINE: Wong Ka-chun

SECTION: BUSINESS; Pg. 5

LENGTH: 340 words

China Timber Resources Group, a Hong Kong-listed forestry operator and
trading company, plans an aggressive acquisition of new forestry land
to grab more market share, according to chief executive Stephen Lau.
The company acquired two forestry sites recently in the South American
country of Guyana totalling 250,000 hectares - about 21/2 times the
size of Hong Kong - and is now actively moving to acquire further
sites in the mainland, said Mr Lau.
"China is full of resources and the government welcomes investments,"
Mr Lau said, adding that although the acquisition in Guyana could offer
the firm stable income in the first few years, the earnings driver in
the long term would come from expansion in the mainland.
"Supportive government policy, tight supply and heavy demand, as well
as lower operating costs, have lured us to accelerate our search for
investments in China," he said.
Under its expansion plans, China Timber expects each new investment
will involve at least 100,000 cubic metres along with 50-year operation
concessions.
A further new acquisition is expected to be completed before the end
of the year.
The mainland is ranked fifth-largest in the world in terms of total
forest reserves and is also the second-largest forest products importer
with imports of $10US billion in 2005.
The government officially opened the timber exploration market for
private-sector participation in 2003. Soaring demand for timber on the
mainland is driven mainly by the country's rapid economic expansion and
development of the downstream wood processing sector, according to a
report by Deutsche Bank.
China Timber is an upstream timber operator that engages in forest
operation and management, logging and timber processing and trading. It
also provides wood for downstream operators such as paper and
furniture makers, as well as construction material suppliers.
Hungry for wood
China is the second-largest forest products importer in the world
The size of China Timber's forestry sites in Guyana compared with Hong
Kong 2.5x

LOAD-DATE: September 24, 2007

LANGUAGE: ENGLISH

PUBLICATION-TYPE: Newspaper


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