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Alternative Investments | Pine Tree Growing In Uganda

52
Posted April 7, 2013 by Ugandan Diaspora News Team in Business ~ 23,406 views

     

Pine  Growing — Yosamu Semugoma has been growing Pine in Uganda over the last 7 years. For many Ugandans, tree growing has become the long term investment. Annual returns average 10-25% depending on tree specie grown, and for how long. We talked to Yosamu to dig up some data. (yosamusemugoma@gmail.com, +256-772-422958)

Recommended Trees

Pine and Eucalyptus are the most feasible trees to grow in Uganda. They are relatively high value given the time they take to mature. Pine takes 15-18 years to mature, Eucalyptus 10 years. Other tree species include Mahogany (40 years), Muvule (40 years), Musizi (15 years). Although Musizi takes a relatively short time to grow and is a low maintenance tree, it’s not high value and takes too much space to grow. We’ll focus mainly on Pine growing.

Inputs

One needs land, seedlings, labor, capital. Initial costs include cost of clearing land, buying seedlings, planting seedlings, transportation costs, seedling handling costs. Main monthly running costs include transportation costs to visit farm, security costs to safeguard against tree theft and/or fire. After year 3, maintenance costs for Pine drop significantly. Unlike Eucalyptus that’s susceptible to termites and needs a regular dose of pesticides, Pine can grow without issue in termite infested land. However each tree requires some level of care against pests and disease.

Data

440 seedlings of Pine are recommended on every acre of land.
Each seedling costs about 400/= ($0.15).
Cost of clearing an acre of land is about 150,000/= ($58)
Cost of planting seedlings on an acre is about 50,000/= ($19)

The first 3 years are the most hectic in terms of maintenance costs, making sure the trees get off to a good start. A worker can look after up to 20 acres of land. So to benefit from scale, given that the running costs for 20 acres is about the same as the running costs for a farm less than 20 acres, if you have the land and initial capital to cover planting costs, you may as well do 20 acres.

See Figure 1 for a breakdown of costs and returns assuming a 20 acre tree farm 40km outside of Kampala.

Figure 1: Cost and Return breakdown for Pine Tree Growing in Uganda

Twelve years looks like the meaty part of the curve in terms of annualized returns and time requirement. If you’re a patient investor you could go out to 40 years. There’s not much value add to the price of Pine after 40years.
Given the long time frames required for Pine investments, to help generate some interim cash flows some folks plant both Pine and Eucalyptus. A 7-year Eucalyptus log is worth 40,000/= ($15) while a Pine log is 10,000/- ($4).
The returns from Pine growing look healthy, assuming today’s prices reflect at a minimum the price of pine 10 or so years from now.

Challenges

Long Time Horizon
Hefty Capital Requirement
Easy loss due to fire and theft
Price risk at maturity although this can be hedged away by securing a price contract

Most investments have challenges, the question is, can you handle the pain?
Reach out to Yosamu if interested in growing your own trees. The man loves trees.

We leave you with legendary investor Warren Buffet, “Someone’s sitting in the shade today because someone planted a tree a long time ago.”

Compiled by Emmanuel Sabiiti Team: Zach Aprea, Jay Dhamsania. Email: info@emmaresearch.com


About the Author

Ugandan Diaspora News Team

Ugandan Diaspora News Online is an independent, non political news portal primarily aimed at serving Ugandans who work and reside outside Uganda. Our aim is to be a one stop shop for everything Ugandan and the celebration of our Ugandan heritage.

52 Comments


 
 

  1.  

    What a very interesting investment opportunity.

    I’d probably rather invest in something like that with $100k than putting $100k into a pension fund.




  2.  
    Hussein B

    Can any one recomend a potential buyer of pine about 30acres @9years of age,thank you




  3.  
    nikos

    This is very insightful, please keep us in the loop for more investment opportunities.
    Cheers




  4.  
    Didas

    Just to share my passion with tree growing i planted 5 acres of Eucalyptus and after 3 years i got unsolicited offer of 120 million.




    •  
      Peter

      Hello Didas,

      I have more than 50,000 trees at 4 to 5 years. Where can i get a buyer. They are located 200 kms south of Kampala capital. Approximately 30,000 Eucalyptus, 20,000 Graveillea and 10,000 pine.

      Was your offer selling off with the land or without the land?.

      Thanks
      Peter.
      SoddoPeter@hotmail.com




      •  
        Busiinge Alvin Fred

        within three months from now, i will be dealing in buying pine timbers only and i think market for your trees is absolutely available because i will be buying in bulk and need constant supply.. we can get in touch and we negotiate on the terms. thanks




  5.  
    Frank kasonga

    with the introduction of insurance to cover this sector ,one can now invest without much worry.




  6.  
    Peter

    Hello Didas,

    I have more than 50,000 trees at 4 to 5 years. Where can i get a buyer. They are located 200 kms south of Kampala capital. Approximately 30,000 Eucalyptus, 20,000 Graveillea and 10,000 pine.

    Was your offer selling off with the land or without the land?.

    Thanks
    Peter.
    SoddoPeter@hotmail.com




  7.  
    Dora M.N. Kampala

    Thanx for the insight but we also need the market connection. I have 460 acres of pine in Mubende, some is 8years and some is 10 years old. I want to sell off all the trees but also the land will be sold. if you want to buy trees only, wait for the land to be sold first but if you want the land we can negotiate for both as a deal. I really want to know that it is not a waste of time because I have been trying to sell for two years now.
    thanks.
    Dora
    doramngabo@gmail.com




  8.  
    Dora M.N. Kampala

    Thanx for the insight but we also need the market connection. I have 460 acres of pine in Mubende, some is 8years and some is 10 years old. I want to sell off all the trees but also the land will be sold. if you want to buy trees only, wait for the land to be sold first but if you want the land we can negotiate for both as a deal. I really want to know that it is not a waste of time because I have been trying to sell for two years now.
    thanks.
    Dora
    doramngabo@gmail.com, 0754 950455




  9.  
    Sarah Namazzi

    I am greatful for the information shared and I believe it has enlightened me on the way forward to the process of pine planting as I have already finished clearing the land waiting for rain to start planting though on small scale .thanks




  10.  
    Muwanga esero

    Am also apine grower with 5 acre but ma main challnge is land.




  11.  
    Tukube Tabia

    hello guys, thanks for posting this important information about the Eucalyptus. I am working on my 20 acres of land right now and am looking for seedling, can some one out there help to know how much will it cost to buy eucalyptus seedling for 20 acres? thanks .

    Tukube Tabia




  12.  
    RICHARD EKONG

    Am very much interested in pine seedlings coz am clearing land currently for pine growing but i dont know where to source good quality seedlings.EMAIL ME@ ekong.pa@gmail.com




  13.  
    orum john

    I have pine trees of about seven (7) years and am stranded, I would wish to sell it to get funds to plant more.the trees are about one(1) acre and are in makaouri zone, Ramogi parish in petta sub-county Tororo district. if there is market, please contact me either on mail above or on cel-phone 0756756263,0775875102. thank you for your help.




  14.  
    Fred

    Iam currently thining a 30 acre , 7 year Pine plantation. If you are interested to purchase pine logs lcontact me. Email me at fred.kakaire44@gmail.com or call 0752379945




  15.  
    John

    Buyers interested in 3 acres of 8 year Eucalyptus trees (Approx 1500) contact John on 0782205326 or baptjo@yahoo.co.uk. The trees are located in Bushenyi Sheema. Thax




  16.  
    NENAH JAMES

    hey guys thanks but i hav a nursery producing rapid growing clonal eucalyptus seedlings. If any one interested in buying pliz call me on 0704245726. I hav different clone types like GC796/1,GC796/2,GC55O,GC54O,TAG5,and GU7/8 at different prices am located in buloba,mityana rd 11km from kampala thanks.I also hav improved pawpaw and passion fruits.




  17.  
    Michael Wen

    Cost is only 100 ugandan shilling per tree when they are babies.




  18.  
    Kiconco Maureen

    Hallo can anyone recommend a buyer for pine trees aged 9years in kabale district? Thanks




  19.  
    WILSON KULE

    Thanks alot for your updates am gonna join this longterm investment God bless you.




  20.  
    WILSON KULE

    where is the nearest place to get seedlings i stay in Bwera bukonzo county kasese district.let me know the location.




  21.  
    Julius

    I have 30 acres of pine trees ( 6years old) for selling. If there is anyone interested, please contact me on mutegayab@yahoo.com.




  22.  
    KAYANJA KENETH

    Is Eucalyptus the so called KALITUNSI in luganda.




  23.  
    KAYANJA KENETH

    I jus want to kno currently, how much does a pine tree of 15years cost?




  24.  
    NAAT

    I Have An Acre Of Pine 6yrs In Hoima. A Good Buyer May Contact Me on 0773474676




  25.  
    Kiima

    I hve pine of six years for sale along ntoroko-fortportal road. contact me 0700701734




    •  
      kk

      Hello Kiima, am having some trees and have about 70 acres of 2 to 6 years along karugutu Fortportal road (Nyakabale area). May I know where you are located and can you please contact me at smenta2003@yahoo.com since am currently out of Uganda and tell me the price. Am interested in buying and knowing the place please. Am a native of Kitumbi in Kichwamba.Which type of the trees did you plant and how is the spacing? Have they ever been affected by fires of Ruenzori region?? The source of the seedlings. Are you connected to the WWF managers?




  26.  
    ojok Geoffrey

    Thanks for the great focused idea of investment.May i know the best spacing of the eucalyptus and pine seedlings,the price of the new type of eucalyptus and pine which take shorter period of time than the traditional ones.




    •  
      kk

      Dear Ojok Geoffrey are you the guy whom I know from katigondo from 1997 to 2000? Possibly room 50 Lwanga? If yes then I was sleeping opposite your room 50 in 52.Please try to check with the Uganda saw log production grant scheme at http://www.sawlog.ug you will get an idea. I would wish that you do not plant any tree (seedling) before contacting the district forestry officer otherwise you may buy trees from a poor seed-bed which may not give you good products. Go slow as you plan on planting trees please. Research is always very important.If you are the gentleman who went through katigondo do not hesitate to contact me at smenta2003@yahoo’com and we can add on from there. Blessings Ojok.




  27.  
    Tom Mugabi

    3 acres of cloned eucalyptus are available for sale, 20 miles from city centre. Call +256751333366 for details or send mail (mugabi2000us@yahoo.com). Land title is available and infrastructure is excellent.

    Eucalyptus clonal seedlings are also available at negotiable rates, depending on quantity.




  28.  
    James Nenah

    Mr. Ojok to help u ,u need to leave your number or email




  29.  
    William

    Mawanda how much are you asking for




  30.  
    Francis Nkoyoyo

    Thanks for the knowledge guys.just aquestion
    ihav over 20acres of land but it has sand soil. have been using it for cattle producing. can I use this sand soil for Eucalyptus growing and iget good yields? if no wat is the best type of soils for eucalyptus growing?




  31.  
    Matovu christopher

    I have pine trees sofar there 7years and am looking for market. The biggest size is 4fits contact is 0704205701 there total is 6600 trees




  32.  
    JAMES

    francis call me on 0704245726 thanks francis i can remeber one time u called me now am waiting for u




  33.  

    hello. I have 10 year old pine available on Entebbe. Contact me on 0702261966/0772895326




  34.  
    Alice Atugonza

    I have 8 acres 15 years old pine in Hoima 11 miles – Nyantozi Road ready for sale. Contact me on email: maryatugonza@hotmail.com




  35.  
    Egau Joseph

    I have 10 acres of land ready to plant eucalyptus, may any one provide me with information regarding the best varieties and where to get them including the price. my Email is egaujoe@gmail.com,egauj@yahoo.com, +256772070734, thanks.




  36.  
    Tenywa Henry

    I have 4 acres of 10 year old pine located in Sembatya district ready for sell. any interested buyer contact me on 0781538666 or by email on: tynehenry@gmail.com, thanks




  37.  
    mayanja

    i have a ten acre pine forest; eight years old; located in Buikwe District; 19km from lugazi.
    i plan to harvest at 12 yrs….need potential buyers for entire acreage.
    0772428799
    0702156317




  38.  
    shimon kirya

    Hi I have 20 acres of pines tree in luwero for sale ranging from 6yrs to 4yrs. Mi whatsapp +971528924283 or contact on +256750648056 thks




  39.  
    shimon kirya

    Hi I have 20 acres of pines tree in luwero for sale pius land ranging from 6yrs to 4yrs. Mi whatsapp +971528924283 or contact on +256750648056 thks




 
 



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