Continued high resources for legacies and special factors

About 370 000 hectares of forests (own forest and smaller concessions) are currently available for harvest. We have made further efforts to legalize the land titles that have not yet been secured and to evaluate and secure new concessions. We are also trying to exchange land areas located in protected zones (around 41 000 ha) against productive, usable areas. We are currently negotiating with the government in this regard.

In fiscal year 2019, value adjustments were made on about 60 000 ha of land that had previously only been partially depreciated. This was done on the basis of our current assessment as we are likely to lose the legal dispute over this land.

At the same time, negotiations with the “new” owners are taking place with the aim of concluding a concession agreement so that we can still use this forest area.

In the reporting year, there was no new information concerning the pending threat of two major fines dating back to 2002 and 2007. The threatened fine by the Brazilian environmental protection agency IBAMA and a threatened property tax fine continue to be legal cases that our lawyers are working on, and we expect that the matter can be resolved within the scope of provisions already set aside.

Precious Woods Amazon in brief

Precious Woods has been operating in the state of Amazonas, Brazil, since 1996. PW Amazon runs sustainable forestry operations on 472 576 hectares of its own land and concessions (as of the end of 2019) near Itacoatiara, 170 kilometres east of Manaus. PW Amazon has been certified according to FSC criteria since 1997. In December 2017, PW Amazon was additionally certified according to PEFC guidelines. Certified forests are managed sustainably on the basis of an audited harvesting plan under which only two or three trees per hectare of forest are harvested in a 35-year cycle. At the same time, this gentle and sustainable use generates a source of income for the local population, which in turn contributes further to the protection of the forest. The harvested timber is processed into sawn timber, planed timber, construction piles, and finished products at the company’s own factory. The wood products are exported to Europe, the United States, and Asia as well as being sold on the local market.