Investment Options
This Teak forestry investment opportunity is in Sri Lanka through the Board of Investment (BOI). Sri Lanka is an investment friendly politically stable country with an open market economy. The BOI projects are constitutionally guaranteed. Therefore, this investment is safer and provides the security of a growing and tangible asset, free of the volatility and risks associated with conventional markets. If you want to diversify your portfolio or interested in gaining inheritance tax advantages, there is no doubt that forestry is one of the best investment options.
The tables below reflect the actual results from documented first thinnings, and the original historically-based data for the subsequent thinnings and final harvests. While we believe these growth estimates, costs and yields to be fair and reasonable based on historical data, future values may vary depending on tree growth and market conditions. The harvest dates are for projections only. The actual dates will be up to you as you are in control at all times to decide when harvests take place.
We hope following information will help you to make an informed investment decision.
25 Year Teak Forestry Investment Option
The following projections are based on approx. ½ acre of Teak planting (approx 324 trees assuming 2.5m square grid).
Investor buys trees on a ½ acre of land = £10,800
Plus Maintenance x 5 Years = £5,000
Total Outlay Over 5 Years = £15,800
Harvest Value Year 7 = £7,615 (136 trees harvested)
Harvest Value Year 10 = £14,439 (65 trees harvested)
Harvest Value Year 14 = £23,815 (39 trees harvested)
Harvest Value Year 18 = £38,008 (32 trees harvested)
Harvest Value Year 21 = £63,740 (26 trees harvested)
Harvest Value Year 25 = £114,011 (26 trees harvested)
Total Harvest Value = £261,628) (324 trees harvested)
Net Harvest Value = £222,383
Profit = £211,583
Teak Projections per ½ acre
| Tree age | Number of trees harvested |
Value per tree | Gross harvest proceeds | Less harvesting & processing |
Less 5% profit | Net harvest proceeds | Cumulative |
| 7 | 136 | £56 | £7,615 | -£381 | -£381 | £6,853 | £6,853 |
| 10 | 65 | £223 | £14,439 | -£772 | -£772 | £12,995 | £18,746 |
| 14 | 39 | £613 | £23,815 | -£1,191 | -£1,191 | £21,433 | £38,988 |
| 18 | 32 | £1,174 | £38,008 | -£1,900 | -£1,900 | £34,207 | £71,295 |
| 21 | 26 | £2,461 | £63,740 | -£3,187 | -£3,187 | £57,366 | £125,474 |
| 25 | 26 | £4,402 | £114,011 | -£5,701 | -£5,701 | £102,610 | £222,383 |
| IRR average overall is 10.99% | |
| This table shows the projected growth, harvests and yields from planting teak trees on 1/2 acre plot.These projections are based on a conservative lumber price of £0.72 per board foot for the first thinning, increasing at an annual rate of 6% for the subsequent thinnings and the final harvest.It was assumed that trees are grown on a grid of 2.5m X 2.5m | The 5% profit share is retained by SEI as our harvest profit. The harvesting and processing costs are for milling your trees and we have allowed a generous 5%. The actual costs are lower than this. The care and maintenance fees are what we deduct from your harvest revenues starting at year seven for growing and maintaining your trees. |