Greenwood, Arborgen team up to grow tree farms

By Anna Austin | March 23, 2011

Biotechnology tree seedling producer Arborgen Inc. and tree farm development company GreenWood Resources Inc. have teamed up to collaborate on the growth of purpose-grown hardwood trees in the Southeastern U.S.

The companies have collaborated in the past, which helped paved the way for this new partnership that will benefit both parties, according to Hunter Brown, GreenWood chief operating officer. “Greenwood has a long history in poplar genetics—we think [poplar] will be a viable, purpose-grown tree for the bioenergy industry—but we don’t have a platform for delivering that plant material,” he said. “Arborgen does. They have a strong network of nurseries and orchards throughout the Southeast U.S., and also have a strong network of customers—they sell hundreds of millions of seedlings of pines each year to landowners throughout the region.”

Arborgen also has customer bases in New Zealand and Australia.

On the other hand, Greenwood has a large network of timber investment customers and relationships, and has developed funds for short-rotation tree farming. “The synergies and overlap are significant in both of our efforts to cost-effectively deliver plant material to bioenergy opportunities as they develop,” Hunter said. “They already have the nursery and orchard business; we already have the plant material and can be ready without spending a lot of extra capital.”

Though the partnership with Arborgen will be focused on the Southeastern U.S., Hunter said there is solid activity in the energy tree sector outside of the country, mainly because of stronger government signals. “If you look at the industry on a global level, it’s certainly developing with more stable, predictable policies and regulations, especially in Europe, South America and Chile in particular, where economic fundamentals make dedicated biomass crops economically feasible,” he said. “In the U.S., in general, the policy and regulations have been a little less certain, especially over the last year with budgetary cutbacks and policy reassessments.”

Hunter believes the fiber produced from dedicated tree farms in the U.S. will be delivered to conversion facilities outside of the U.S. in significant portions.

He added that GreenWood and Arborgen expect to begin developing dedicated tree farm plant material in 2012, as 2011 will be mostly a scale-up year in the nurseries.