PRODUCTIVITY AND FINANCIAL RETURN
The “ideal” age for cedar harvesting is 15 years, and this time period may be advanced or delayed depending on the specific conditions of the crop producer’s needs.
The initial investment in the crop is approximately R$ 15,000.00/ha over the first four years – the time required for crop deployment (May 2015 values, for mechanized areas). The cost drops considerably after the fifth year. Still, we keep an annual investment of R$ 1,000.00 per hectare, with chemical fertilization of 400 kg of NPK/ha until the 15th year.
Below, we show a financial table of an Australian cedar project, with thinning of 300 plants at 8 years and clearcutting at 15 years, according to the following assumptions:
Premises:
– Project discount rate: 18% p.a.
– All figures in present value.
– Productivity with 600 plants/ha = 30m3/ha/year (to year 8).
– Productivity with 300 plants/ha = 20m3/ha/year (year 9 to year 15).
– Utilization of timber for sawmills at 8 years = 70%.
– Yield at the sawmill for 3m3 logs to produce 1 m3 sawn lumber (28m3 sawn/ha).
– Price of sawn lumber at 8 years: R$ 1,500.00/m3 FOB.
– Wood production at 8 years: R$ 2,160.00/ha (36m3 x R$ 60.00/m3 CIF).
– Utilization of timber for sawmills at 15 years = 80%.
– Yield on sawmill of 2m3 of logs to make 1m3 of sawn wood (104m3 of sawn/ha).
– Price of sawn lumber at 15 years: R$ 2,500.00/m3 FOB.
– Wood production at 15 years: R$ 3,120.00/ha (52m3 x R$ 60.00/m3 CIF).
Cutting and harvesting costs:
– At 8 years R$ 30.00/m3, 120m3 x R$ 30.00 = R$ 3,600.00.
– At 15 years: R$ 40.00/m3, 260m3 x R$ 40.00 = R $ 10,400.00.
Processing cost of the wood in the sawmill: R$ 150,00/m3.
– At 8 years R$ 150.00/m3 x 28m3 = R$ 4,200.00.
– At 15 years R$ 150.00/m3, 104m3 = R$ 15,600.00.
|
Year
|
Investment | Revenue | Expenses | Balance/year | Balance/total |
| 1 | 8.000 | – | – | (8.000) | (8.000) |
| 2 | 2.500 | – | – | (2.500) | (10.500) |
| 3 | 2.500 | – | – | (2.500) | (13.000) |
| 4 | 2.000 | – | – | (2.000) | (15.000) |
| 5 | 1.000 | – | – | (1.000) | (16.000) |
| 6 | 1.000 | – | – | (1.000) | (17.000) |
| 7 | 1.000 | – | – | (1.000) | (18.000) |
| 8 | 1.000 | 44.160 | 7.800 | 35.360 | 17.360 |
| 9 | 1.000 | – | – | (1.000) | 16.360 |
| 10 | 1.000 | – | – | (1.000) | 15.360 |
| 11 | 1.000 | – | – | (1.000) | 14.360 |
| 12 | 1.000 | – | – | (1.000) | 13.360 |
| 13 | 1.000 | – | – | (1.000) | 12.360 |
| 14 | 1.000 | – | – | (1.000) | 11.360 |
| 15 | 1.000 | 263.120 | 26.000 | 236.120 | 247.480 |
| Total | 26.000 | 307.280 | 33.800 |
| Present Value | R$ 18.817,08 |
| IRR* | 27,92% |
All data is based on real facts, the result of experience and research carried out at Bela Vista Forestry with the species since 2002.
*It is important to remember that not the entire wood can be used in the sawmill. Since its shape is tapered, we have different uses for the timber produced from the first log trunk, with thicker and prized wood to the tip of the stem and branches, which may be thin and tortuous, to be used for energy (firewood). At 8 years, about 70% of the wood produced have sufficient diameter to be allocated to the sawmill, and the remaining, 30%, is sold as firewood. At 15 years this rate changes to 80% to the sawmill and 20% firewood.
** IRR: Internal Rate of Return of the project.
NOTE: ALL VALUES ARE ESTIMATED AND ARE SUBJECT TO CHANGE. BELA VISTA FORESTRY DOES NOT GUARANTEE CUSTOMER PROFITABILITY.