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Overseas real estate is one great
way to hedge against a falling U.S. dollar. Investing in timber is another. Now
you can make forestry investments in Argentina invest in timber in Argentina where
prices are low and values are high.
Forestry is an investment that
can be profitable and incredibly good for the world. Today's trends are disturbing.
The global population grows. Natural resources decline. U.S. government debt is
at all time highs and rapidly rising. Politicians are bolder in their lies.
All of these factors argue in
favor of forestry investments in Argentina.
One way to diversify against
currency loss and inflation is real estate and commodities. Timberland has an
exceptionally good record on this count because it combines both assets.
Now let's look at why forestry
investments in Argentina makes special sense.
Forestry Investments in Argentina
Assets
One huge problem that faces the
world is water pollution and the surging costs of dealing with nature's risks.
Argentina has one of the world's largest fresh water reserves: not only are the
great Patagonian lakes, glaciers and continental ice-shelf nearby, but the Guaraní
aquifer, the Paraná and Uruguay rivers are part of the territory.
Yet forestry investments in Argentina
are a fraction of the cost of properties in Brazil and Paraguay, not to speak
of the northern hemisphere.
Forestry investments in Argentina
can be a profitable investment in a tangible non-speculative asset that provides
growing wealth that takes excess carbon dioxide out of the atmosphere. This can
help reduce global warming as it expands your bank account!
Growing trees takes carbon out
of the atmosphere and frees the oxygen. One forestry investment in Argentina run
by in a eucalyptus plantation in Entre Ríos and pine plantation in Misiones
made by Steve Rosberg at Ushay Forestry Company withdraws approximately 35 metric
tons of carbon dioxide per hectare per annum.
Steve writes about Forestry Investments
in Argentina:
"Our plantations are in some
of the highest forestry productivity regions on earth. We plant eucalyptus and
pine, which start generating income after eight or nine years, when the forests
are thinned. The whole cycle takes between eleven and eighteen years, and provides
recreation opportunities in the meantime!
The forecast returns, even with
the most prudent and conservative hypotheses, are very good. If you own your property,
you should expect to make over 11 % compounded annually. And this is under the
assumption that future prices do not rise beyond today's, which are 30% to 50%
lower than those prevailing in neighboring Brazil or Chile, both of which are
experiencing timber shortages which are getting more and more severe.
In summary, we sequester carbon
dioxide from the atmosphere at a prodigious rate, take the pressure off the natural
forests, and make good profits."
How can you invest in forestry
investments in Argentina?
There are several ways in which
you can invest. You can buy the land and grow a forest. Or you can buy participations
in a forestry investment trust for a single forest cycle.
Buy the Land as a Forestry Investment
in Argentina
Buying your own forest is the
most lucrative and best option, as you can run your property as you prefer. And,
if you wish, you can build a house, have horses, and even obtain full residency
rights in Argentina.
Properties are all different,
so pricing and potential vary. Some are apt for forestry only, some will have
a portion you can assign to nature preservation, others may have a portion suitable
for cattle grazing or citrus or fruit production.
All land shares year-round snow-free
weather and have substantial real-estate appreciation potential because of their
location and natural beauty.
Starting investment is approximately
USD 66,000 for a 35 hectare lot (86.5 acres). Rosberg is buying and subdividing
a property for this purpose, close to the city of Concordia.
This investment includes the
costs of planting and caring for the plantation.
At today's prices, for an eleven
year forest cycle Ushay anticipates that forestry investments in Argentina will
generate income in excess of USD 1.3 million plus some cattle grazing revenue
and, of course, the appreciation of the land value. The IRR, the compounded annual
yield will be well in excess of 10%.
Ushay has other properties for
larger investors in the region, ranging in size from 500 hectares to 1200 hectares,
and valued in the USD 800,000 to USD 1,500,000 price range.
They have also identified Forestry
Investments in Argentina farther north where the climate is subtropical.
Forestry Investments in Argentina
Trusts
Investors wanting to invest smaller
amounts can buy units in a forestry trust.
In this case, they buy part of
a newly planted forest trust (or, in the future, growing forest trust) that gives
you rights to income generated by the forest as it is cut.
The land is held in a trust which
bears the carrying cost of the land.
Entry investment levels are either
USD 10,000, representing the forest on approximately 10.3 acres or USD 2,500 representing
2.34 acres.
At the end of the forest cycle,
Ushay expects forestry investments in Argentina will receive at least USD 25,700
for the USD 10.000 investment and USD 5,800 for the USD 2,500 investment.
All trust investments can be
sold or transferred at any time, and there is no tax due in Argentina for profits.
Other benefits
Ushay also expects to be able
to sell carbon credits originated in the plantations that we manage once the Kyoto
Protocol Clean Development Mechanism comes into operation.
If and when this happens, 80%
of the net proceeds will be for investors' benefit.
Forestry Investments in Argentina Taxation Benefits
The Argentine forestry legislation
exempts forestry investments in Argentina from most taxes and allows a method
of accounting for forest growth that eliminates most of the income tax.
No guaranty can be given that
this will continue to be the case for the duration of the investment. However,
as soon as the whole project is underwritten we will apply for the special tax
stability guaranty foreseen in the legislation.
Visiting Forestry Investments
in Argentina
Investors are always welcome
to come and visit the properties and meet the Ushay team. This is one of the very
enjoyable aspects of our activity, both for our investors and for Ushay.
As there are many reasons to
visit Argentina including
forestry investments in Argentina.
Many of the questions regarding
ownership and title are addressed at Ushay.com/realestate.htm
Please email your questions and
requests for further information to rosberg@ushay.com.
Gary & Merri Scott have
green investments in their North Carolina Farm (Merrily Farms) and Ecuador Plantation
(Rosaspamba) shown below:
"Merrily Farms
in the Fall"
"Rosaspamba's Virgin
Rain Forest" |
