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Newsletter
August 2011 edition

 

 

Brazilian Forest Code reform necessary to grow farm sector

Workshops to strengthen Brazilian community forest management

Silver and gold reach a record high for investments in 2011

The future of eurozone still uncertain for investors

The American Debt Crisis

Congo’s Government in talks with Chevron, Petro bras on Oil, Gas Investment

Charcoal Prices

 

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Welcome to the August edition of the Greenwood Management monthly newsletter.

Our aim is to send out a newsletter on a monthly basis to advise you of future events and report on previous industry related themes and news articles.

As you may be aware, we recently released our New Brunswick Christmas Tree project for sale, which has already generated a substantial amount of interest and investment from old and new clients alike. To support this project, Greenwood Management has launched a brand new website aimed at providing the most up-to-date multi-media information on what they do. For more information visit gwm-tv-canada.com for photos and video footage of the Christmas tree plantation projects in New Brunswick.

Also, last month we mentioned that we may be launching an exciting new project in the near future. To update you, we can advise that our forestry engineers are revisiting Costa Rica this month to complete the evaluation of potential projects for investment.

We have included below some investment articles that may be of interest. Enjoy reading and look out for announcements on our new project.

 

Brazilian Forest Code reform
necessary to grow farm sector

Over the past twenty years Brazil has emerged as an agricultural superpower and today stands as the largest exporter of beef, sugar, coffee, and orange juice, and the second largest producer of soybeans.

Much of this growth has been led by a sharp increase in productivity from improved breeding stock and technological innovation. Due to this, Brazil has benefited from vast expanses of available land in the Amazon and the cerrado, a grassland ecosystem. Agricultural growth in Brazil, however, has always been limited —at least on paper— by its environmental laws. Under the country's Forest Code, landowners in the Amazon must keep 80 percent of their land forested.

Recently, there has been astrong interest in "regulating" the Forest Code to ensure complete compliance. Leading the push has been an alliance of large-scale farmers and ranchers, who are hoping to reduce forest reserve requirements, stipulations for reforestation, and restrictions against clearing forest along waterways and on hillsides.

Among the biggest supporters of the Forest Code reform bill is Senator Katia Abreu, a member of opposition Democrat Party who heads the Brazilian Agricultural Confederation (CNA).

To read the full story click here.

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Workshops to strengthen Brazilian community forest management

The Brazilian Forest Service (SFB) has arranged a capacity-building workshop (the first of the four scheduled) for participants from civil society and community leaders involved in community forestry in the regions of Transamazonian and Xingu River.

The forest management practices of today are adequate to maintain the potential of the forest generating income for local populations but, say the SFB, many are not aware of this.

The objective of SFB is to help strengthen the region's forest economy, valuing its resources and providing technical capacity that these communities need to achieve their goals.

To read the full story click here.

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Silver and gold reach a record high for investments in 2011

As gold hits a new record high, precious metals are still shining brightly among investors.
Precious metals –gold, platinum and silver– were the best performing asset class over the first half of 2011, providing a return of 4.9 per cent, according to research by Lloyds TSB.

A combination of a commodities boom and the desire for safe haven investments has driven the returns, but gold is not leading the pack.

Silver was the precious metal that fared the best, significantly outperforming the other precious metals over the first half of 2011 with prices rising by 14 per cent –this is more than double the increase in gold prices (6.6 per cent).

In addition to its position as a safe haven investment, high demand for industrial uses has contributed to the strong rise in the price of silver.

In contrast, the price of platinum dropped 1.9 per cent in the last six months –but despite this, precious metals still beat other assets such as property and share investments.

To read the full story click here.

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The future of eurozone still uncertain for investors

Investors were looking to move their money outside of the eurozone following a renewed threat to the debt crisis which threatened to erupt again on Tuesday as Italy and Spain's borrowing costs hit record highs, helping to drive Britain's own borrowing costs down to a record low.

The euro also lost ground against most major currencies and the Italian stock market hit a 27-month low, as investors appeared to lose faith in the latest European rescue package.

The yield, or interest rate, on Italian 10-year bonds rose to nearly 6.3% at one stage, with the equivalent Spanish bonds yielding almost 6.5% early on Tuesday. If yields reach 7%, a country has effectively lost the support of the international markets.

In contrast, UK 10-year gilt yields hit an all-time low of 2.76%, amid suggestions that the UK has become a relative safe haven in response to the debt crises raging in both Europe and America. The glut of disappointing manufacturing data released on Tuesday also reinforced fears that the global economy is faltering.

The cost of insuring Portuguese, Italian and Spanish debt also rose sharply on Tuesday, according to data from financial information provider Markit.

Although Italy pushed through a four-year austerity plan in July, the scale of the country's borrowing needs are alarming investors. Last month's Greek bailout, which will see private creditors take a "haircut" on their loans, has also deterred some fund managers from buying more Italian debt.

 

Past 2 months euro decline against the Brazilian Real

 

To read the full story click here.

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The American Debt Crisis

President Barack Obama has signed legislation to increase the US debt ceiling and avert a financial default, after Congress voted in favour of a bipartisan compromise deal.

The bill cleared its final hurdle in the Senate by 74 votes to 26, after negotiations went down to the wire. It raises the debt limit by up to $2.4tn (£1.5tn) from $14.3tn, and makes savings of at least $2.1tn in 10 years. But the bill's passage failed to lift financial markets.

On Wall Street stocks ended Tuesday down by more than 2%, amid poor consumer spending data for June.

The bill's signing came just 10 hours before the expiry of a deadline for Washington to raise its borrowing limit, after drawn-out talks between Republicans, Democrats and the White House.
Without a deal to raise the debt ceiling, the US would have been unable to meet all its bills, the treasury department had warned.

Speaking at the White House shortly after the decisive vote in the Senate, President Obama said it was "pretty likely that the uncertainty surrounding the raising of the debt ceiling for businesses and consumers has been unsettling".

He urged Congress to now look to boost the economy through measures to create jobs and increase consumer confidence.

To read the full story click here.

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Congo’s Government in talks with Chevron, Petro bras on Oil, Gas Investment

The Democratic Republic of Congo is currently in talks with PetroleoBrasileiro SA (PETR4) and Chevron Corp. (CVX) about investing in the country’s budding hydrocarbons industry, Oil Minister Celestin Mbuyu said.

The Central African nation wants to improve its oil and gas output and infrastructure and is allocating blocks to companies for exploration. San Ramon, California-based Chevron and Congo are discussing gas production and treatment plans that may feed into the company’s projects in neighboring Angola. A deal will likely include training and transfer of expertise between the Rio de Janeiro-based company and Cohydro, he said.

Congo currently produces about 25,000 barrels of oil per day and plans to increase output through drilling near its eastern borders with Tanzania, Burundi, Rwanda and Uganda, as well as in its central basin and along the western coast bordering Angola. The country is courting investment for exploration, pipelines, distribution and storage, and data gathering to help develop the industry, Mbuyu said.

The minister led a delegation of Congolese officials to Brazil last month, where Petrobras shared its experience with oil and gas operations “in tropical forest and coastal areas,” the company’s press management office said yesterday in an e- mailed response to questions. Congo is home to the world’s second-largest tropical forest, after Brazil’s, some of which has been divided up into oil blocks.

Chevron, the second-largest U.S. energy company, signed an agreement with Congo in November that will allow the company to ship gas from Angola’s enclave of Cabinda to a new $9 billion liquid-natural-gas plant in Soyo via a pipeline that cuts through Congo’s narrow strip of Atlantic coastline.

To read the full story click here.

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Charcoal Prices

Click here to receive information on the latest charcoal prices from Brazil.

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