Land Management
Teak Plantations
Barco Pacifico Del Este S.A. (BPDE), a veteran company specialized in land management for US and EU absentee owners, has established and carefully managed Barzusa (100Has), Tolasi (7 Has), Bosques del mar (10 Has) and La Posada Los Destiladeros (8 Has) plantations. BPDE S.A. also worked on several reforestation programs in the Los Santos province (over 250,000 trees planted).
Trees in the first 5 years of the plantation were culled to eliminate inferior trees and were used as posts for the local market. The marketable harvest of the plantations is scheduled to start when the teak trees are 16 years old and then again at 20 years old (2014 until 2018).
Knowing the current size of the trees and their current measured growth rate, BPDE S.A. has calculated the size of the teak trees in 11 years and therefore the total volume of marketable teak logs that can be harvested at that time through out the entire mature cycle. In the case of the Barzusa/Tolasi plantation (107 Has total), BPDE S.A. estimated that approximately 35,000 M3 of marketable teak can be harvested (years 16 to 20).
The current FOB price for high quality teak logs 35 cm + is approximately US $ 425 per cubic meter.
Assuming the price of the teak does not increase for the next 15 years, the Barzusa/Tolasi plantation should yield a potential gross profit of US $ 11.9M. Or assuming an increase of 5 % per annum in teak prices, as consistent with previous years, this plantation should yield a potential gross profit of US $ 18M +.
These figures are profits from the harvest of logs only without any consideration for vertical integration in milling and marketing.
Sawing the logs into lumber can produce much higher profit as shown on the following table for the Barzusa/Tolasi plantation.
Note: The Barzusa/Tolasi plantation was sold to a European investor in 2006.