Forests for Friends Ltd manages the plantations via its daughter company Forests for Friends Panama Inc. in a sustainable manner. Every business has risks and opportunities. Our business model is long term and thus many risks are to be seen in connexion with the uncertainties of the future. Some of them are listed below:

Risks
The plantations are planned over a period of twenty years. We cannot predict the development of the political situation in Panama over this time, whether the tax situation may change to our disadvantage or whether the tax exemption currently granted could be abolished.
Plantations only keep their value if they are maintained expertly until the final harvest. This is a huge investment. The Board of Directors is confident that it will be able to regain the money with the sale of timber and land.
Fires during the dry season are not dangerous for older plantations. Preventive measures such as cutting the vegetation before and during the dry season, creating fire breaks and continuous monitoring help us reduce the risks as much as possible. We have no insurance policy, as the premium is far too high in comparison to the expected damage and the indemnification. In addition, the risk distribution is much better for a shareholding company with various plantations than in the case of individualised tree ownership.
The maintenance is paid in US dollars and the income will be mainly in this currency. Therefore, part of the available money is invested in US dollars. Shareholders in Europe do have a currency risk over the twenty years.
We publish the growth classes and projections on our website. They are cautiously calculated by BARCA and regularly updated. External developments such as natural disasters or climate change may influence them negatively.

Opportunities
Timber prices can rise and they can fall. Following the financial crisis, they have fallen, but we expect them to recover in the not too distant future. However, we can neither predict nor influence the price for plantation teak at the final harvest. The Board of Directors, nevertheless, holds that the price for high-value teakwood is more likely to rise. In addition, the trees can be harvested one or two years later, should the timber prices be in a trough.
Panama is less influenced by the economic crisis than the USA or many countries in the EU. Nevertheless, there is a massive increase of costs. As we have quite a lot of land that is not planted or is not ideal for teak plantations, we are selling it  in areas that are being developed for tourists.
In our business model, the shareholders also own the land which can be commercialised after the final harvest.