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By some estimates, the teak resources in Myanmar will be eliminated by the year 2003.  Couple this with conservation programs such as Target Year 2,000.  This US Initiative Joint Implementation program commits signatories to develop sustainable forestry programs by the year 2,000 or eliminate their right to export lumber.  A hundred countries, including Panamá have committed to this objective, which will have a further limiting effect on supply as stricter regulations are brought into force.  The demand for high quality hardwoods continues to strengthen. The World Bank estimates demand for hardwoods in the US and Europe is increasing by 25% a year.  For the forester, this is good news indeed. As the hardwood supply diminishes and the demand increases, sustainable timber plantations may be the only sources for legally harvested, marketed and exported lumber in the future. The Bottom Line Tropical hardwoods such as rosewood, teak, purple heart, and the like, though commanding a higher market price, have longer maturities, while softwoods such as acacia (used for pulp),  eucalyptus (phone poles) and melina (plywood) have lower maturities but less value in the marketplace.

Perhaps the largest incentives for investors, however, are the potential ]returns.  It is clear that the existing supply of wild teak, for example, is fast diminishing from traditional teak producing sources such as India, Myanmar (formerly Burma) and Thailand.

A eucalyptus pole of 50', for example could be sold for $100 in today's market.  A cubic meter of teak, on the other hand, can sell for as much as $3,500 in Japan.  This is an equivalent of $8.00 a board foot retail, whereas some softer woods such as pine command only $.70 in today's market.  Prices have increased at the rate of over 10% a year since the early 70s, and it is estimated by the World Bank that this figure will increase 15-40% in the next 15 years. 

The bottom line for investors is that teak is the hand's down winner in the earnings category. 

In the life of a teak plantation, the first harvest begins at 12 years, and is cut in rotating cycles as the teak tree, once cut, regenerates itself up to 3 times.

For trees planted in a 3 meter X 3 meter quadrant, thinned, and maintained properly, a hectare of teak at today’s prices will yield gross income of over $475,000 in 20 years. ANAM projects plantation set-up and maintenance costs to be in the vicinity of $17,000 per hectare over the life of a 20-year plantation, and this figure is adjusted for inflation. 

Raw land in Panamá can be bought for as little as $1,500 a hectare.  Indeed, in the Bocas del Toro islands, it is still possible to buy a farm with direct sea frontage, gorgeous second or primary home site, and one’s own dock included in the same low price. 

As a retirement fund, or for funds for upcoming college tuitions, or simply a way to earn millions of dollars in a tax-sheltered investment, what better way to secure the future than to plant trees?  For smart and caring investors, an eco-investment like this is hard to beat; in Panamá the climate is ripe for planting and harvesting.