Portland-based GreenWood Resources is about to wager up to US300m on China, where soaring demand for cabinets, paper and furniture makes wood a hot commodity, reports Amy Hsuan in The Oregonian.
Poised to become one of the first US companies to invest in Chinese timberland, GreenWood seeks fortune by taking
Portland-based GreenWood Resources is about to wager up to US300m on China, where soaring demand for cabinets, paper and furniture makes wood a hot commodity, reports Amy Hsuan in The Oregonian.
Poised to become one of the first US companies to invest in Chinese timberland, GreenWood seeks fortune by taking Oregon expertise offshore.
But in China, communist politics still command the countryside, says Ms Hsuan. Up against long-held views on land rights, GreenWood will own all the trees that will grow here in 70 years, but it will never own the land. Its long-term contracts could be left to local officials, who in the past and in other areas have taken a Wild West approach to ruling rural China.
“What GreenWood is up to for the US is pretty unique,says Hakan Ekstrom, president of Wood Resources International, an industry consulting firm. “But you really need to know what you are doing and have some luck there.”
GreenWood’s grand intention comes with a cost: for the price of leasing land in China, GreenWood will pay as much as in the US, says Brain Liu, vice president of GreenWood’s China headquarters in Beijing. However being in the centre of the world’s manufacturing heartland is worth paying a premium. Next year, Chinese furniture exports alone are expected to top US48bn, according to the China Building Decoration Association.
“The Chinese have rising incomes and they’ll be buying wood products more and more,Mr Liu says. “There are so many Chinese, they could buy half of what Americans buy, and they would double worldwide sales.”
