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The past few years have been a really tough time to be an investor. Markets have experienced more ups and downs than the average rollercoaster, and the value of many asset classes, such as commercial property, have plummeted while traditionally boring investments, such as Government gilts and forestry have put on a better performance. The feedback many investors have provided to us at Greenwoods is that it's dangerous to underestimate the risks of some investments.

The old adage, "You should have a bit of everything” is unfashionable in boom times, but it's only during a recession that people really feel the value of this approach.

Many experts were shocked at how far and fast the markets went down - it was a real wake-up call. It wasn't just the sharp falls seen in the stock market last year that hurt investors - many were also caught out by the rally early in 2009 simply because they weren't in the market. It just highlights the fact that only a small minority can time the markets - and trying to is a risky business.

A more measured approach to investments seems to be the main lesson that many people have taken away from the credit crunch. This means less chasing after yield and more focus on long-term returns. . Investors are now embracing the basic principal of diversification too.

Naturally, the promise of high returns will always appeal, but perhaps its time to remember that the bigger the reward, the greater the risk..


The United Nations Economic Commission recently produced its “Annual Forest Products Market Review for 2008-2009”.

This 188 page document provides statistical data on global forestry markets and related policies. So not exactly a light read. Having waded through the document, the conclusions drawn were made crystal clear.

- “The quest for renewable energy sources, in the light of recognition of the dangers of climate change, with the drive for energy security, is producing a STRUCTURAL CHANGE within the forestry sector. Driven by government policies, despite the economic crisis in 2008-2009, wood energy markets remained BUOYANT.

- “The wood energy sector seems to have been IMMUNE to the global economic recession”.

- “Demand for alternative fuels, including WOOD BIOMASS, continues to GROW STEADILY”.


Every day the world is becoming greener. Businesses, consumers, governments are changing their behaviour.

As we drink our sustainably-grown coffee from our recycled paper cups, we constantly read news about biofuels, hybrid vehicles, global warming etc. So it’s no surprise that, despite the general downturn of the global markets over recent times, the Environmental Opportunities All-Share Indexes have outperformed their counterparts.

The Environmental Opportunities Index measures the performance of global companies that have significant involvement in environmental business activities, such renewable and alternative energy, water technology and pollution control. The Environmental asset class is out-performing almost all other sectors.

The world market for environmental goods and services are comparable in size to sectors such as pharmaceuticals or aerospace. “Green” is now an asset class in its own right. How green is your portfolio?


To Greenwash….. The act of misleading consumers with respect to the environmental practices of a company or the environmental benefits of their product. Consumers are increasingly demanding greener products for themselves, their families and the planet. They want sustainable products they can trust and easily access.

Examples of “Greenwashing”

- A claim that is so wide-ranging that its real meaning is deliberately worded to be misunderstood by the consumer. ‘All-natural’ is an example. Arsenic and cyanide are naturally occurring, and poisonous. ‘All natural’ doesn’t always mean ‘green’

- .Suggesting that a product is ‘green’ based on very flexible parameters, whilst actually paying no attention to other important environmental issues. Paper, for example, is not necessarily environmentally-preferable just because it comes from a sustainably-managed forest. There are many other important environmental issues in the process of paper-making, such as the bleaching ingredients. Chlorine would not be considered to be an environmentally desirable choice for example.

- An environmental statement that may be accurate but is unimportant or unhelpful for consumers looking for environmentally preferable products. ‘CFC-free’ is a common example, since it is a very common claim. The fact that CFCs are banned by law makes the claim totally superfluous.

- A claim that could well be true within the product category, but actually distracts the buyer from the greater environmental impacts of the category as a whole. Organic tobacco, fuel efficient sports utility vehicles would be fitting examples.

“Greenwashing” will lead to doubt and cynicism about all environmental claims and the global movement towards environmental sustainability will lose its momentum. Competitive pressure from bogus environmental claims will reduce market share from genuinely innovative, environmentally aware businesses. Green marketing offers huge commercial advantage but only when it is true and backed up by scientific fact. It is important that Green environmentally sound projects do not become devalued by exaggerated or false claims.

BRAZIL, August 09.

Twenty Brazilian companies have called on the government to show leadership at UN climate talks.

The companies have written to the Brazilian President Luiz Inacio Lula da Silva, pledging to cut their own emissions on an annual basis. They also urged the government to take a leadership role at this year's annual climate summit in Copenhagen in December.

Amongst the companies signing the letter were steelmaker Vale, agro forestry and minerals giant Votorantim, and the leading pulp and paper producer Aracruz Celulose.

The firm vowed to cut their carbon footprint by improving production processes and investing in carbon capture and storage technology. The letter also makes recommendations to the Brazilian government to help build “a new model for development, based on a low-carbon economy”. Ibama, the federal environment agency in Brazil require new coal and oil energy plants to offset at least one-third of its projected emissions through investment in renewable energy generation or measures to improve energy efficiency.

Brazil’s foreign minister said the government would pledge to cut emissions at the UN talks in the Danish capital. Environment Minister Carlos Minc spoke at a private event in Sao Paulo “I am convinced that Brazil will arrive in Copenhagen with targets that imply a decline in the curve of emissions.” The number to be presented is still being negotiated within the government, mainly between the ministries of foreign affairs, science and technology, and environment.


The first definition I learnt as I embarked upon my first economics lesson was about “Scarcity”. Economics is the study of how society manages its scarce resources. Scarcity is the main driver for demand-pull inflation. The big bad world of scarcity is what the study of economics is all about.

You might ask what’s this got to do with managed forestry plantations? Well nearly three quarters of Brazils iron ore and two thirds of its pig iron are produced in the Minas Gerais region of Brazil. The pig iron is made in blast furnaces using a combination of iron ore with coal or charcoal. In the past, coal has been the main source of energy, but charcoal is increasingly being used as its replacement. The main reasons for the increase being environmental demands (with heavy penalties for carbon offenders), the cost of coal (which has to be imported into Brazil), charcoal can be produced locally and is a renewable fuel.

All these factors have lead to an increased demand for charcoal but production levels have been, and still remain unable to meet this demand. Charcoal is the scarce resource in the equation. Recent figures show that up to 75,000 hectares are needed to meet the existing demand, let alone the future increases that are envisioned. In the past, much of this charcoal was produced illegally. Sixty steel producers were fine a total of $252 million for irregular charcoal production. But now the Government in Brazil has created a growing market for sustainably produced eucalyptus trees for the charcoal.

Greenwoods plantations are producing charcoal on a 6-8year growth cycle. The target market for the charcoal being the local pig iron producers. Although the local independent producers have some plantations of their own, they are unable to meet their own demands due to their own capital restrictions. Currently they are using increasingly scarce resources and find the securing of reliable long term charcoal sources almost impossible. Greenwood management will secure a consistent supply and quality of charcoal to the independent producers. The reforestation strategy adopted by the Brazilian government will also provide much needed security to the independent producers.

Back to economics for a minute, demand-pull inflation is in play here. Investors in our plantations will be the beneficiaries from these strong markets, rising charcoal prices and consistent cash generation.


Greenwood Management is pleased to announce it is sponsoring an area of the Cocobolo Nature Reserve, an area of primary lowland rainforest which supports a vast array of endangered species.

The project, run by CREA (a non-for-profit organisation), aims to preserve a network of conservation regions from Columbia to Mexico.

CREA trains subsistence farmers to use sustainable farming techniques and provides environmental education to both children and adults.. The objective of the Nature reserve is to help indigenous communities to protect their forests through educational programs for food production and agricultural practices. Historically, unsustainable use of land for farming has forced farmers to move further into the forests of the region, creating vulnerability to the natural habitat for biodiversity.

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Sincerely, Joe Randall
Greenwood Management

Greenwood Management Offices


103 - 105 Lower Rathmines Road,
Dublin 6,
Tel: 00 353 (0) 1452 0326
Fax: 00 353 (0) 1452 0341
C.R.O 337892


avda Jaume 111,
21 Planta,
07002 Palma de Mallorca,