Rebecca Harper
Myfarm has no plans to plant productive sheep and beef farms in pine trees.
Chief executive Andrew Watters said Myfarm is subdividing farms bought for forestry, planting the marginal country and selling the more productive land back to farmers,
The Feilding-based business provides farm syndication opportunities for investors in dairy, sheep and beef, horticulture (permanent crops), manuka honey and rural commercial property.
Watters, said at this stage MyFarm was only working with a select group of investors on forestry.
To date, it has bought three farms, one of which was converted to manuka for honey production, in partnership with Comvita.
The other two properties are intended for production forestry, with the aim to harvest logs, not carbon farming.
MyFarm is subdividing off a significant proportion of the farms to sell back to neighbours or farmers, ensuring the most productive land is retained for pastoral agriculture.
“We are very much thinking about land use and leaving the best. It doesn’t make sense for New Zealand Inc (to plant whole farms) so we’re actively looking to cut off the better parts of the properties and sell them on.”
This did prove a catch 22, as selling large parts of the properties meant it needed to buy more farms to fulfil its investment brief.
“But the outcome is that we are only planting the land most suited to trees.”
Watters said the investment thesis was a mix of returns from wood and returns from carbon.
“Carbon does give investors potential cash earnings while the forest is growing.”
However, they are only able to claim a portion for carbon, due to the fact the forest is intended for harvest, and only for the first rotation.
The company does not have big plans in the forestry space.
“We’re not doing anything with our database or offering products to our existing syndicates at this stage. We’re working with some larger investors and will see what happens in the future. We’re not investing huge amounts of money at present.
“It’s millions, but not tens of millions. We still have a bit more land to buy, but not huge plans.
“The good thing is this boom, I guess, in forestry and forest planting is occurring at a time when red meat prices are very good. Ultimately, the sheep and beef does need to compete and good farmers with good farming practices getting reasonable prices for their stock, it’s kind of a fair fight at the moment.”
