Teak

Teak

Big Lands Brazil excels in the acquisition, set up and management of teak plantations for our clients. We work hard to assist our clients with teak plantation investments. We work in a consulting, management, project acquisition, project setup and post-project setup management for our clients.

Client Investment Strategy

Big Lands Brazil has created a fund strategy for accredited investors (or equivalent), companies, and funds seeking long-term, consistent returns based on a conservative business plan in surging market of Brazil. This investment is designed as a trusted option to gain access to the emerging market of Brazil in a safe manner, truly unique in the marketplace. The investment is not designed to be creative in taking on unnecessary risk. Teak, one of the world’s most noble trees, is cultivated in Brazil to excel in the warm and wet climate with a yearly dry season. Soil conditions in specific areas of Brazil allow teak to be highly profitable compared to other regions of the world with similar climate. Teak has wide-ranging applications in the wood products business. Teak is a long-term, stable-return plantation crop, best suited for institutional pension fund investors, young wealthy individuals, and trust fund investors seeking long term investments.

The Big Lands Brazil Strategy

  • The investor owns all land in full either individually or through a corporate structure.
  • Land is purchased below market value in areas with strong expected appreciation.
  • Big Lands Brazil offers high technical assistance. We have as our contract engineer the top teak engineer in the North of Brazil, he currently advises on 90% of the teak plantations in the state of Para’s 40 different plantations. We have this technical expertise part of our team as we only want the best success for our clients.
  • The end product teak is targeted to have sale agreements before investment is made. Big Lands Brazil will manage and process the wood during the thinning as well as sell the wood. We do not recommend the sale of raw standing wood as the wood doubles in value if it is sawn wood. For our other clients we have set up small saw mills on the property and will process the wood to achieve higher profit margins for our clients.
  • In addition to the current expected return on investment, which is high. The market for the end product has room to expand 5% per year over the next 20 years.
  • The 1st thinning, between 7 and 10 years will provide a lucrative cash for the farm to operate during the remaining years.
  • The future demand is expected to soar over the next few years. Currently over 90% of the worlds hardwoods come from native forests. Through a series of laws, regulations and industry standards over the next ten years the world will no longer allow for illegal wood to be exported internationally. Only certified wood, such as teak plantation wood will have value on the international market. This will create further demand for plantation teak, as it will make up for the loss in supply from native forests.
  • The project replants trees in the Amazon region originally deforested for cattle farms.
  • The investor has several exit options, including reforesting the land with native forest (creating a private reserve), selling to reclaim equity, or repurposing the land for a new project.

Big Lands Brazil has worked diligently to design this investment to be more competitive than the competition. The land we source for our clients has a lower price tag, the planting costs are less because we have strong relationships on the ground. We anticipate that on a large scale plantation US$1500 dollars per acre planted is a reasonable price that an investor will pay the first year. Please contact us for more details.

Product Offering

Our current property is a list of current cattle farms that range from 100 hectares open area up to 3,500 hectares open area, all located near the port, with optimal climate and soil conditions.

We have over 15 small- to medium-sized teak plantations for sale that range from 20,000 trees to 850,000 trees planted at six years.

Please contact us for more details.

Teak S.W.O.T. Analysis

Strengths

  • Excellent ROI
  • Working to reforest pastures
  • Carbon sequestration higher than native forest
  • Multiple market end users
  • Guaranteed future market
  • Relative low setup costs
  • Easy to administrate
  • Low risk for all involved
  • Certification Schemes (FSC) to solidify Market Position

Weaknesses

  • Long-term ROI for investor (15-23 years)

Opportunities

  • Unlimited marketing potential
  • Unlimited market growth potential

Why not other trees?

There are other trees such as African Mahogany grown in Brazil on larger scale operations. Mahogany is a hardwood and even considered more noble than Teak. However this tree requires far more attention and unlike teak, Mahogany has threats such as ants and a fungus, and these same predators do not affect teak.

Supply and Demand

The current price of TEAK is R$200 to R$1,000 per m3. With higher prices for finished products. The younger the tree, the lower the price.

Wood Products - are the main usage for teak. This ranges from laminates for younger teak to solid wood, high end furniture for the oldest trees.

The key to a successful teak plantation is to not sell the trees but to sell sawn wood or a wood product. At a minimum, this will double the profits of the plantation. Big Lands Brazil operates small saw mills for each plantation that we currently manage. We see to it our clients make the most money on their investments.

Further detailed information on teak can be found at About Teak.

About Teak

Of all the tropical hardwood species, perhaps among all tree species, teak holds a particular fascination for both consumers and investors, much as gold does among the precious metals. Valued for more than 2,000 years as an extraordinarily durable construction timber in its native range in Asia, teak is now coveted worldwide. Its extremely high dimensional stability and unique aesthetic qualities keep it in high demand for shipbuilding, laminates and fine furniture manufacturing. Teak is also well suited for finishings such as door and window frames and any other applications that require a strong, stable, durable hardwood.

As the sustainable supply of teak from natural forests in Asia diminishes, demand for teak increases, and teak prices rise, we expect to see expanded production of plantation-grown teak. Teak cultivation has been the subject of research programs in Brazil since 1960, and best-practice techniques for producing high-quality plantation teak are well documented. Because teak is relatively easy to cultivate, has excellent growth rates, and provides a lucrative return, it is very suitable as a plantation timber species in areas with appropriate ecological conditions.

Investment in properly managed teak plantations is a "win-win" situation in a country such as Brazil, where government programs are in place to encourage reforestation through generous loan programs. The investor makes a profit, new jobs are created, land is reclaimed, and there are long-lasting environmental benefits from tropical wood binding of carbon dioxide.

Teak

Teak is the common name for the tropical hardwood tree species Tectona grandis and its wood products. Tectona grandis is native to south and southeast Asia, mainly India, Indonesia, Malaysia, and Myanmar, but is naturalized and cultivated in many countries, including those in Brazil, Africa and the Caribbean. Myanmar accounts for nearly one third of the world's total teak production, however Myanmar is far less stable as a country as Brazil.

The word teak comes from the Malayalam (in the Malabar region) word theka or tekka. The original word comes from Thekkam in Tamil. This tree is mentioned in the seventh century literature of Tamil popularly known as Tevaram.

Description

Tectona grandis is a large, deciduous tree that is dominant in mixed hardwood forests. It has small, fragrant white flowers and papery leaves that are often hairy on the lower surface.

Tectona grandis is a large, deciduous tree that grows up to 40 m (131 ft) tall with gray to grayish brown branchlets. Leaves are ovate-elliptic to ovate, 15-45 cm (5.9-17.7 in) long by 8-23 cm (3.1-9.1 in) wide, and are held on robust petioles that are 2-4 cm (0.8-1.6 in) long. Leaf margins are entire.

Fragrant white flowers are borne on 25-40 cm (10-16 in) long by 30 cm (12 in) wide panicles from June to August. The corolla tube is 2.5-3 mm long with 2 mm wide obtuse lobes. Tectona grandis sets fruit from September to December; fruits are globose and 1.2-1.8 cm in diameter.

Flowers are weakly protandrous in that the anthers precede the stigma in maturity and pollen is shed within a few hours of the flower opening. The flowers are primarily entomophilous (insect-pollinated), but can occasionally be anemophilous (wind-pollinated). A 1996 study found that in its native range in Thailand, the major pollinator were species in the Ceratina genus of bees.

Distribution and Habitat

Tectona grandis is one of three species in the genus Tectona. The other two species, T. hamiltoniana and T. philippinensis, are endemics with relatively small native distributions in Myanmar and the Philippines, respectively.

Tectona grandis is found in a variety of habitats and climatic conditions from arid areas with only 500 mm of rain per year to very moist forests with up to 5,000 mm of rain per year. Typically, though, the annual rainfall in areas where teak grows averages 1,250-1,650 mm with a 3-5 month dry season.

Botanical History

Tectona grandis was first formally described by Carl Linnaeus the Younger in his 1782 work Supplementum Plantarum.[8] In 1975, Harold Norman Moldenke published new descriptions of four forms of this species in the journal Phytologia. Moldenke described each form as varying slightly from the type specimen: T. grandis f. canescens is distinguished from the type material by being densely canescent, or covered in hairs, on the underside of the leaf, T. grandis f. pilosula is distinct from the type material in the varying morphology of the leaf veins, T. grandis f. punctata is only hairy on the larger veins on the underside of the leaf, and T. grandis f. tomentella is noted for its dense yellowish tomentose hairs on the lower surface of the leaf.

Teak is a yellowish brown timber with good grains and texture. It is used in the manufacture of outdoor furniture, boat decks, and other articles where weather resistance is desired. It is also used for cutting boards, indoor flooring, countertops and as a veneer for indoor furnishings.

Teak, though easily worked, can cause severe blunting on edged tools because of the presence of silica in the wood. Teak's natural oils make it useful in exposed locations, and make the timber termite and pest resistant. Teak is durable even when not treated with oil or varnish. Timber cut from old teak trees was once believed to be more durable and harder than plantation grown teak. Studies have shown Plantation Teak performs on par with old-growth teak in erosion rate, dimensional stability, warping, and surface checking, but is more susceptible to color change from UV exposure.

The vast majority of commercially harvested teak is grown on teak plantations found in Indonesia and controlled by Perum Perhutani (a state owned forest enterprise) that manages the country's forests. The primary use of teak harvested in Indonesia is in the production of outdoor teak furniture for export.

Teak consumption raises a number of environmental concerns, such as the disappearance of rare old-growth teak. However, its popularity has led to growth in sustainable Plantation Teak production throughout the seasonally dry tropics in forestry plantations. The Forest Stewardship Council offers certification of sustainably grown and harvested teak products. Propagation of teak via tissue culture for plantation purposes is commercially viable.

Much of the world's teak is exported by Indonesia and Myanmar. There is also a rapidly growing plantation grown market in Central America and South America (BRAZIL, with over 50,000 hectares planted between the states of Mato Grosso and Para).

Teak is used extensively in India to make doors and window frames, furniture and columns and beams in old type houses. It is very resistant to termite attacks. Mature teak fetches a very good price. It is grown extensively by forest departments of different states in forest areas. The country of India currently, based on a number of Big Lands Brazil clients is one of the highest purchasers of teak from Brazil at this time.

Leaves of the teak wood tree are used in making Pellakai gatti (jackfruit dumpling), where batter is poured into a teak leaf and is steamed.This type of usage is found in the coastal district of Udupi in the Tulunadu region in South India. The leaves are also used in gudeg, a dish of young jackfruit made in Central Java, Indonesia, and give the dish its dark brown color.

Teak is used as a food plant by the larvae of moths of the genus Endoclita including E. aroura, E. chalybeatus, E. damor, E. gmelina, E. malabaricus, E. sericeus and E. signifer and other Lepidoptera including Turnip Moth.

Teak is used extensively in boat decks, as it is extremely durable and requires very little maintainance. The teak tends to wear in to the softer 'summer' growth bands first, forming a natural 'non-slip' surface. Any sanding is therefore only damaging. Use of modern cleaning compounds, oils or preservatives will shorten the life of the teak, as it contains natural teak-oil a very small distance below the white surface. Wooden boat experts will only wash the teak with salt water, and re-caulk when needed. This cleans the deck, and prevents it from drying out and the wood shrinking. The salt helps it absorb and retain moisture, and prevents any mildew and algal growth. People with poor knowledge often over-maintain the teak, and drastically shorten its life.

Propogation

Tree in new leaves in Kolkata, West Bengal, India.

Teak is propagated mainly from seeds. Germination of the seeds involves pretreatment to remove dormancy arising from the thick pericarp. Pretreatment involves alternate wetting and drying of the seed. The seeds are soaked in water for 12 hours and then spread to dry in the sun for 12 hours. This is repeated for 10-14 days and then the seeds are sown in shallow germination beds of coarse peat covered by sand. The seeds then germinate after 15 to 30 days.

Sources

  • "GRIN Taxonomy for Plants - Tectona". United States Department of Agriculture.
  • Chambers, W. 1875. Chambers's Etymological Dictionary of the English Language. London. p. 513.
  • Flora of China 17: 16. Accessed online: 17 December 2010.
  • S. and J. N. Owens. 1996. Floral biology, pollination, pistil receptivity, and pollen tube growth of teak (Tectona grandis Linn f.). Annals of Botany, 79(3): 227-241. doi:10.1006/anbo.1996.0317
  • Bryndum, K. and T. Hedegart. 1969. Pollination of teak (Tectona grandis Linn.f.). Silv. Genet. 18: 77-80.
  • Tewari, D. N. 1992. A monograph on teak (Tectonia grandis Linn.f.). International Book Distributors.
  • Kaosa-ard, A. 1981. Teak its natural distribution and related factors. Nat. His. Bull. Siam. Soc., 29: 55-74.
  • International Organization for Plant Information (IOPI). "Plant Name Search Results" (HTML). International Plant Names Index. Retrieved 17 December 2010.
  • Moldenke, H. N. 1975. Notes on new and noteworthy plants. LXXVII. Phytologia, 31: 28.
  • Teak tissue culture company: http://wtamc.com/PlantingMaterials.htm
  • Herbison-Evans, Don (2007-09-06). "Hyblaea puera". University of Technology, Sydney. Archived from the original on 2008-07-24.
  • Kadambi, K. (1972). Silviculture and management of Teak. Bulletin 24 School of Forestry, Stephen F. Austin State University Nacogdoches, Texas
  • B. Robertson (2002) Growing Teak in the Top End of the NT. Agnote. No. G26 PDF