Global Timber Outlook

Gresham House Global Timber Outlook

In this detailed report, Gresham House looks at the drivers behind global timber consumption, which we believe will result in increasing timber prices and therefore also forestry asset values. Over the past 20 years, global timber consumption has increased by 1.1% per annum. Over the next 30 years, Gresham House expects timber consumption to rise by 3.1% per annum.

Looking at the global picture, the vast majority of countries have set significant targets to reduce carbon emissions towards net zero by 2050.

Timber will play a critical part in this transformation.

The dual effect of urbanisation and decarbonisation will be more new homes and cleaner low carbon intensity buildings being built from timber. Wood will increasingly replace high carbon intensive steel and concrete.

Forestry ownership and returns continue to be underpinned by the biological growth of the trees. Forests provide protection from inflation and portfolio diversification, with minimal correlation to other asset classes. During the COVID-19 pandemic, forest values have continued to rise, due to assets being valued on a long term basis.

In times of unprecedented volatility, the defensive nature of forestry ownership is particularly pertinent.

There has never been a more relevant time to add forestry to a diversified investment portfolio.

In the Global Timber Outlook…

•  Analysis of global uses of timber and future developments
•  Key drivers underpinning demand for timber:  Urbanisation, Decarbonisination and Housing shortages
•  Forecasts for timber consumption
•  Environmental, Social and Governance (ESG) investing
•  Asset yield compression