China ranks first in global plantation area (about 25 million ha) and fifth in global forest area (175 million ha).

To address the growing and massive timber supply gap, numerous Chinese government policies and incentives have recently been enacted to expand the area and volume of plantations; the focus is on the expansion of fast-growing, high-yield (FGHY) plantations. The goal by 2010 is to have 4.7 million ha of FGHY plantations established, providing 49 million m3 of timber per year, which in turn can support 6.4 million m3 of wood-based panel production, and provide 3.4 million m3 of large-diameter timber production. By 2020, the FGHY plantations are planned to exceed 13 million ha, providing a whopping 133 million m3 of timber per year that could support 21.5 million m3 of wood-based panel production and 15.8 million m3 of large diameter-timber. These goals and new policies demonstrate the importance of the forestry sector in the eyes of the central government. These plantation policies and others are being used by the government to stimulate investments in priority projects, especially in the wood pulp and wood panel sectors. For potential investors, China’s market for locally grown plantation wood offers good prospects for stable and continuous revenues. However, in China’s current context, developing new plantations or buying existing plantations is not a straightforward task.

Source: WOOD Markets Monthly, October 2007 Report Thanks Paul!