Forest Invest

Join me today as I speak with Andrea Braun, Director of Unique Forest Investment, where we dive into all things Paraguay – well related to forest investment that is. In our conversation, Andrea describes why Paraguay is becoming a favourable forest investment destination – covering several macro-level indicators as well as forest specifics relating to biological and climatic growing conditions, markets and industrial development. We talk about risks and opportunities, and get into the details on some of the technicalities of managing forests in Paraguay. 

“There are not as many places in the world that offer as good conditions for forest investments as Paraguay, especially in terms of climatic and biophysical conditions”

Host: Shauna Matkovich - The Forest Link

Producer: Magdalena Laas - https://www.linkedin.com/in/laasmagdalena/

Details

01:30

Andrea introduction and overview of Unique Forest investments

02:36

Why Paraguay is favourable for forest investments

04:26

Eucalyptus species – more than 90% in Paraguay

05:18

Issues investors should be aware of in Paraguay

06:00

Details of the mill to come online

06:22

Rotation for pulp and paper

07:09

Paraguay’s political environment and legislation: positive or negative for forestry investment?

08:05

No limitations to acquire land – how tenure operates

08:31

Currency risk in Paraguay?

09:42

Forestry infrastructure in Paraguay

10:54

Current market – for export or local use?

13:23

Opportunity for enhancing biodiversity in land use – historical deforestation and legislation

16:42

Species of trees used

17:40

Climate change risks

19:35

Management regime to limit climate risks

20:10

Benefit of voluntary carbon market

23:36

Balance quality, carbon credits, and eucalyptus

27:17

Plantation forest management

29:59

Where is wood processed?

31:42

Road networks & infrastructure or professional services may affect logistics

33:27

Actionable piece of advice for new investors

35:42

Contact details

02:32 “There are not as many places in the world that offer as good conditions for forest investments as Paraguay, especially in terms of climatic and biophysical conditions”

07:20 “Also the tax regime, labor costs and low energy costs have made the country quite attractive when compared to some of its neighbors […] where the Latin American Economic Climate Index identified Paraguay as having one of the best ease of doing business in the region”.

21:15 “And this [carbon markets] has been very, very interesting for our clients and Paraguay has actually been quite fast and has issued a law to regulate the carbon credit production for private investors.”

Unique Forest investment: https://www.unique-forestinvestment.de/

Andrea’s email: [email protected]

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

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Join me today as I speak with Edit Kiss, Co-founder and Managing Partner at Integrity Capital Advisors. She discusses Integrity Capital Advisors three-pronged strategy for unlocking capital for nature: 1. Imbedding carbon with real assets 2. Appreciating the capital continuum, and 3. Blended finance. We discuss the equity-type risks investors face when funding forest carbon projects, and solutions to lower the cost of capital. We also dig into the importance of price transparency – for investors, carbon credit buyers, and project developers, and we talk about the importance of industry standards that support carbon markets.

Host: Shauna Matkovich - The Forest Link

Producer: Magdalena Laas - https://www.linkedin.com/in/laasmagdalena/

Details

01:01 An overview of Integrity Capital Advisors

06:22 Explanation about the obstacles – mobilizing of private capital side

08:37 Explanation about the mismatch in funding

11:42 A tool – Carbon Collateralized Loans

13:59 Necessity of blended finance

15:27 Paper on private investments in conservation

16:01 Integration of concessional capital

18:14 Carbon buyers wants to buy it but not pay the price

25:20 How to improve carbon price transparency

28:10 Science-based Targets Initiative

31:57 SBTI decision in July – submit feedback on form on website (below)

36:39 Actionable advice

37:17 Links (below

[09:18] Why we are struggling in particular in nature based, is because of the market failure and because of the fact that we don’t have a price on carbon.

[19:41] We need a signal for capital to flow for investors to invest into this next generation projects.

[24:11] What you need to be successful on the ground is to say, I’m going to get this carbon finance as a transition tool and when my crediting period stops and I have no more carbon, I have actually made the transition on the ground.

[36:48] It is imperative that everybody needs to get involved, because the simple truth is that without the natural climate solutions there is no pathway to 1.5 degrees.

SBTI feedback form: https://docs.google.com/forms/d/e/1FAIpQLSc93Gz8_R-ShYeaFAuXc_fqrKZQC1ayvnEw1WorQVfxYZ8KgQ/viewform 

CPIC paper: https://www.cpicfinance.com/insight/new-report-towards-building-a-capital-continuum-for-nature-positive-investments/

NCSA paper: https://www.sustainability.com/globalassets/sustainability.com/guides/ncs-investor-guide.pdf 

Edit Kiss: https://www.linkedin.com/in/edit-kiss-5156732/

Integrity Capital Advisors: https://www.integritycapitaladvisers.com/ 

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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In this episode, I am joined by James Kench, Head of Insurance at Kita. In our conversation James discusses the role of insurance as an enabler to mobilize capital into natural climate solutions in forestry. He describes how their product has been structured to address the most significant risks observed in forest carbon projects, giving some insights into what those risks are. He explains that given its ‘newness’ in the insurance market and the period in a forest carbon project’s life when it is most likely to experience a claim event, that no claims have yet to be made. He gives some great advice to investors looking to participate in forest carbon markets, on what risks they should consider. 

00:37

Intro to James Kench & Kita

03:30

James explains about the different types of nature-based solutions

04:39

Typical client profile explained – corporates and investors

07:27

Insure every asset in the portfolio or asset by asset?

09:18

Portfolio vs individual – underwrite specific transaction

10:28

What happens if a project fails – dimensions of risk

15:09

Delivery risk & concept and execution phase until credits are issued

17:54

How Kita underwrites and how it affects pricing

20:55

Moral hazards

23:54

Characteristics that makes assets uninsurable

26:09

Process of raising capital for offering insurance

29:03

Future of carbon markets

32:17

Examples of actual claims

37:06

Contact details

[07:37]            The main pain point we wanted to solve is that there's reasonably good supply of carbon credits out there, but they're not necessarily a good supply of high-quality credits, and the best way to secure high quality credits is to lock in investment at an early stage of the project.

[08:32]            If the project has failed or has not performed as much as hoped, then our insurance would kick in, and then we would be able to make the investor or the corporate whole, either in cash or in like for like carbon credits.

[14:10]            But where we see investors coming in to lock in that supplier of the most high quality projects, they're very actively trying to source and originate projects all over the world and get in as early as possible because that enables them to secure that supply and secure a good price and then have hopefully a bit more influence and control over the sort of management and success of the project over the longer term.

Kita: https://www.kita.earth/

LinkedIn: https://www.linkedin.com/company/kitaearth/

1. Nature by MaxKoMusic/Soundcloud

Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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Today I’m joined by Steve Novakovic, Managing Director for the Chartered Alternative Investment Analyst Association (CAIA) Curriculum. CAIA serves its international membership across the finance industry enhancing education in relation to alternative investments. From Steve’s wide knowledge of alternative investments, he describes how timberland investment plays a very important role in building a balanced institutional investment portfolio that both serves fiduciary requirements and has strong sustainability features.

Host: Shauna Matkovich - The Forest Link

Timecode

Details

00:33

Intro to Steve Novakovic

02:02

Intro to CAIA

02:55

CAIA’s curriculum (limited partners, alternative investments)

05:19

Member organisations

06:12

Investors sentiments around natural capital investment, specifically forestry

09:40

Deliberate decision-making process and how long it takes

11:22

Geographical location of most experience within the asset class

15:09

Sustainability and impact requirements of European investors

17:32

Demand for education in the asset class

22:37

Educational approach about timber investing (TIMO)

24:55

Shift to sustainable investments

26:21

ESG investing

30:15

Expansion of CAIA’s offerings to its members (e.g., understanding value chain)

34:40

Teaching members about sustainability (UN principles of sustainable investments)

38:12

Actionable advice

40:50

Contact details (see below)

[03:02]            For better or for worse, limited partners is kind of what makes the industry run.     

[09:40]            The decision-making process is deliberate, really intentionally. As a limited partner you are the steward of capital, you have fiduciary responsibilities for whomever it is you are managing the pool of capital for, and you have to be very cautious and mindful in your investment approach.

[19:22]            Timberland is a very low risk investment.

[26:18]            From an academic perspective, there is clear evidence that ESG focused are beneficial in that they reduce risk.

[28:07]            As a fiduciary, you really are supposed to evaluate investments in the context of risk and return, irrespective of your perspective on the environment or social or governance or so forth.

CAIA Association: https://caia.org/

Steven Novakovic: https://caia.org/contact/steven-novakovic-caia-cfa

Steven’s LinkedIn: https://www.linkedin.com/in/steven-novakovic-caia/

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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In this Canada Day episode, I am joined by Dr. Gary Bull, Professor at the University of British Columbia Faculty of Forestry. In our conversation Gary discusses the fundamentals of fire ecology in the context of Canada’s forests, and how it has changed in recent years. He describes the grand transition – both a paradigm shift in forest management practices in British Columbia and indigenous land reformation. From his deep experience in working with multiple stakeholders in the forest sector, he talks about opportunities and solutions for more resilient forests – that include indigenous and community stewardship, growing markets for ecosystem services and bioenergy and private investment. 

Host: Shauna Matkovich - The Forest Link

Details

00:51

Introduction to Gary Bull and his work

04:01

Summary of the wildfire situation in Canada and BC

07:58

Cause of wildfires in BC and Canada

14:20

Community perceptions on fire-smart forest management

15:19

Bioenergy as a solution

16:35

Resources for wildfire management

18:32

Private capital needed for the “Grand restoration”

21:10

Indigenous rights and forest stewardship

23:52

Production of new markets for wood

26:49

Canada and the Paris Agreement

30:59

Advice for investors, considering investing into forests

[03:22]            Last year, we would see that the wildfires produced three times more emissions than all industrial sources of emissions in Canada.

[12:26]            I think now, the recognition is that especially in these landscapes, the boreal landscapes, and parts of the temperate that we will have to use fire as a management tool.

[14:02 ]           We're going to move into an era of active forest management, not just for producing timber from mills, but for active, for producing, preserving ecosystem health.

[18:32]            I don't think governments will ever be able to find all the money required to do the kind of restoration we want and the kind of things that I'm seeing happening, for example, in Brazil, right now, where investors are coming in offering up private investment capital to help with what I would call the Grand restoration challenge.

[26:31]            And I think first nations are in a great position to lead the conversation, and essentially bring these other stakeholders to the table and say, look, we want jobs too, we want investment too, we want ecosystem health and we think we know how to get there.

[29:16]            And so what this [fire suppression] has led to in Alberta (and people will find this perhaps puzzling to understand) is too much old forests. And so, these old forests are now highly vulnerable to fire.

UBC Faculty of Forestry: https://forestry.ubc.ca/

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud                  

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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In today’s episode, I am joined by Dr. Stephanie Gripne, Founder and CEO of the Impact Finance Center and Impact Investing Institute. In our conversation Stephanie identifies some primary challenges with raising capital for forests – that is the need to first, raise investors and second – think about what the forest needs. She describes the need for full spectrum capital to address the needs of the forest value chain, and will have you reconsider your thoughts on impact investing – from philanthropic giving to commercial return seeking investors.

Host: Shauna Matkovich - The Forest Link

00:38

Introduction to Stephanie Gripne and her organisation, Impact Finance Center

06:26

Sustainable Forestry Investment Club and how it came to be

11:42

Four parts of the sustainable forestry investment club – identify and educate investors

13:04

Second part – connect capital stewards with community stewards that need the money

13:35

Third part – governmental spending/grants for start ups

14:23

Part four – mainstream 2.0 – retirement programme (invest in forests?)

16:45

Investor profile & education modules via Forestry Investment Club

17:53

Point of difference in how organisation teaches investing

22:00

Explanation of investments with negative 100% loss/return

24:28

Examples of impact investment transactions

29:42

Reverse engineering in an investment strategy

30:22

Early stages of nature-based investment

34:12

Where do you learn about all the regulations – Green Biz Group – series of conferences

36:12

Mainstream 2.0 & future projects & plans

37:40

Actionable advice to investors

[03:36]            You can think of the Impact Finance Center as an investor accelerator, where we grow investors like we grow trees.

[12:50]            There is a really big need globally for us to create investor accelerators, the same way we have the accelerators for entrepreneurs.

[18:17]            The only way to solve this problem is to shift the question from what does the investor want to what does the forest need.

[26:34]            The only way you can heal a river, whether it is a physical river or a river of capital, which is our mainstream and Wallstreet capital is to restore the flow. That is holistically looking at the capital.

[32:22]            We got to get more money to the forests, to the communities in a way that is needed.

[38:03]            You shift power to the forest and the communities, you learn about full spectrum capital, and then you restore the flow of the capital

Impact Finance Center: https://impactfinancecenter.org/

Green Biz Group: https://www.greenbiz.com/

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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In today’s episode, I am joined by Chris Lipton, Head of Timberland Investments and Cristina Hastings, Head of Sustainability at Nuveen Natural Capital. Listen to our conversation, where Chris explains how timberland investment has changed in recent years and Cristina presents the natural capital balance sheet, which supports Nuveen Natural Capital in valuing nature.

“We are not trying to attach a price to nature, we are trying to recognize the value of it, particularly those ecosystems services which are often silent and invisible.”

Host: Shauna Matkovich - The Forest Link

Details

01:22

Overview of Nuveen & TIAA

01:59

Responsible investment

02:52

Natural capital

04:42

Changes in timberland investments

06:11

Locations of investment properties

06:42

Timberland investment strategy

06:55

Diversification of timberland portfolio

07:58

Carbon credit certification

10:10

Nuveen’s natural capital balance sheet

12:52

Lessons from Natural Capital Balance Sheet Pilot

14:49

Data management - databases

16:18

Take away from pilot and natural balance sheet

17:04

Evolving applications

19:02

Methodology of natural balance sheet – four main steps

21:15

Examples of monetary values

22:10

Advice to investors

25:10

Forecast carbon profile

28:30

Info on website & resources

[04:04]             “Growing trees is currently the most efficient and only scalable technology for GHG sequestration and carbon storage that we have.”

[12:03]             “We are not trying to attach a price to nature, we are trying to recognize the value of it, particularly those ecosystems services which are often silent and invisible.”

[15:16]             “The holistic view of the asset will help showcase the resilience that this careful stewardship has built.”

Nuveen Natural Capital: https://www.nuveen.com/global/about-us/our-people/investment-specialists/natural-capital

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary,

           IRELAND by wild_rumpus/Soundcloud     

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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Today I’m joined by Maria Filmanovic, Co-founder of Abatable. Abatable has developed a platform that enables corporates to access carbon credits from vetted forest carbon projects (among other types of nature-based solutions) and the project developer ecosystem. Listen to our conversation, where Maria explains the various players in forest carbon markets. From Abatable’s extensive market intel, Maria describes what types of forest carbon projects are generating the most demand and provides some thoughts on pricing and risks.

“With the new definition of quality comes potentially more conservative carbon credit estimation […], and for the same implementation costs of these activities, less carbon credits. This means the prices will need to increase for the market at the same time.”

Host: Shauna Matkovich - The Forest Link

01:53

Introduction to Abatable

03:37

Explanation how the ecosystem of players work

05:53

Mentions newsletter Carbon Compass (sectors covered by the voluntary carbon market)

06:16

Demand for carbon credits vs other types of credits

06:43

Explanation of a green fields project (forestation/reforestation)

09:38

Explanation about carbon removals

10:24

Demand for reforestation

11:30

Preference for removal versus avoidance

12:26

Availability of carbon credits deriving from forest projects stack up ot the demand

14:42

Supply and demand issues

17:04

Corporates are forced to look into their ecosystem impact of the supply chain.

19:16

Controversy in the voluntary carbon market

24:52

Explanation of risks and Article 6 of the Paris Agreement

29:06

Actionable advice for investors

[08:11]            “ I think that the market has evolved from myopically looking at carbon and to understanding that through these project activities you can have ecosystem impact that’s been just beyond the carbon sequestration programme.”

[22:45]            “With the new definition of quality comes potentially more conservative carbon credit estimation that will need to occur, and for the same implementation costs of these activities, less carbon credits. This means the prices will need to increase for the market at the same time.”

Abatable: https://abatable.com/

Carbon Compass Newsletter: https://abatable.com/subscribe-to-newsletter/

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud      

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

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Understanding, evaluating, and avoiding or mitigating risk is a key component of any investment decision, and for forest assets it is no different. The difficulty lies where investors don’t understand (and often have inaccurate perceptions) of the risks associated with forest assets. Today, we’re joined by Gordon Steward, of Dual – Managing Director of Forestry. In our conversation, Gordon walks us through the ‘supply chain’ if you will of the insurance industry as it relates to his work with forests. He speaks to the most common geographies where forest insurance is prevalent and why, and describes the importance of sound forest management in reducing risk and making your assets more insurable.

Host: Shauna Matkovich - The Forest Link

Timecode

Details

00:07 Introduction to Gordon and Dual 

03:07 How Dual insures forest assets - an NGA

04:09 The effect of climate change & forest fires

09:12 Biggest risks that concern investors

11:00 Fire or risk management plans are crucial

14:21 Carbon investment groups

15:44 Players in forestry insurance marketplace

15:43 Under pressure to make return for investors

21:04 Get the technical underwriting rate back to where it should be

22:58 Insurance classes and loss ratios

27:45 Financial insurance triggers to lessen the exposure to risk when investing in carbon products

28:24 Fire insurance cover

30:40 Legislation to protect nature and Indigenous people’s land rights

32:29 The use of trees

35:19 Final advice

[24:30]            “Forestry is a very what I term spiky business, so it is prone to catastrophic fire losses.”

[32:29]            “The use of trees in so many industries and processes is quite unbelievable.”

[33:05]            “Wood is so strong, and we make composites so strong now, it is stronger than bricks, it is much lighter and it is carbon friendly.”

Dual: https://www.dualgroup.com/

1. Nature by MaxKoMusic/Soundcloud
2. Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud      

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

Hosted on Acast. See acast.com/privacy for more information.

18:27   “Launching funds is hard.”

22:59   "There is really no substitute for that real hands on experience and expertise."

33:05   "There is a desperate need for more money to go to land use models that have a better impact on the ground both socially and environmentally."       

Restoration Seed Capital Facility: www.restorationfacility.org/

The Forest Link: https://theforestlink.com/

Nature by MaxKoMusic/Soundcloud

Sopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/Soundcloud

Sign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox.

Hosted on Acast. See acast.com/privacy for more information.