UPM Tilhill starts planting project

UPM Tilhill has begun work on the creation of one of the UK's largest commercial woodlands to be planted in over a decade, as investors look to take advantage of the opportunities presented by the forestry sector.

The woodland near Langholm, Scotland will include 1.2 million trees planted across 815ha, with Sitka spruce the main species to be cultivated.

Investment firm FIM Services Ltd acquired the land for a private client in 2006 and is planning to use material derived from the plantation to take advantage of increasing demand for renewable building materials, bio-fuels and carbon sequestration.

An IPD survey last year revealed that UK forestry remained the top performing asset class in the UK, with average returns of over 20% and rising timber prices and land values underpinning its performance.

"A combination of new technology and increasing energy prices is favouring the use of wood, whether as a building material or as a source of bio-fuels," said FIM director Colin Lees-Millais.

"For example, a new wood-fired power station has just opened at nearby Lockerbie, and another is already under construction at Irvine. Wood is also the energy source for second generation liquid bio-fuels."

Tim Liddon, UPM Tihill South West Scotland District manager, said that the creation of the woodland would continue the timber industry's ability to supply the UK timber market, which "unbelievably" remains one of the world's main timber importers.