Korea’s Sunchang Corp is the latest foreign corporate to show interest in New Zealand’s highly sought-after forestry land, as the wood products manufacturer looks to shore up its supply chain. Source: Deal Journal Australia
Sunchang has received New Zealand government permission to purchase 3000 hectares of forestry land in Marlborough, in the north of the country’s South Island, and will look to increase its holdings of land to around 5000 hectares by 2015, a spokesman for the company told Deal Journal Australia.
“We are looking for sustainable wooden material supply from foreign countries such as New Zealand, Australia and Russia,” he said.
As a result, the company decided to purchase its own forestry blocks in New Zealand and expects 20% of its wood to come from sustainable forestry plantations in the country by 2015.
Sunchang joins a growing list of offshore investors interested in rural property in New Zealand. The most high profile of these has been China based Shanghai Pengxin Group’s NZ$200 million purchase of 16 farms, covering nearly 8000 hectares, which has been held up by a number of court cases.
The increasing interest displayed by foreign investors has raised concern among New Zealanders that overseas money could price local farmers out of the land market, particularly as the availability of credit for the agricultural sector has tightened.
New Zealand forestry land prices have risen 25% in the two years to the end September, data released earlier by the Real Estate Institute of New Zealand showed.
