Regarding existing forests within the orbit of Napier Port; dips in export prices may see a deferral of harvest but you are unlikely to see a significant volume transferred from export to domestic consumption. The percentage that was going to be exported via Napier is still likely to be exported via Napier but some of it once prices lift. Forest companies can leave trees in the ground to grow longer but for a number of reasons don't like stretching this out too far as beyond a certain age annual increment per hectare per year starts to decline. Secondly forest companies need a certain amount of cash flow and need to maintain a foothold in some markets so will still put some volume in to export markets even when prices are down. Not to mention a desire to keep their best harvesting crews employed and working for the company even when export prices dip. (I was a manager of various Hawkes Bay forests in a former life)
Like most hyped up IPOs it will finish $2.80-2.85 for today and higher later in the week. Then after the first month or two after the hype it will slowly drop back to $2.60-$2.70 and hopefully lower.
One part of me wants it to go higher as I got some. And the other part that wants more wants it to drop. In the current low interest rate environment I think it should go higher, even though the projected dividend is not high.
Originally Posted by pierre
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