Forestry and the Emissions Trading Scheme

ETS Registration Delays

We have recently received communication from Te Uru Rakau that applications for the inclusion of Post 1989 forest land in the ETS (registrations and Add CAAs) currently have an approximate processing time of six months.

This is concerning news given that PF Olsen, along with many other ETS submitters, still have many thousands of hectares to submit. We did not expect these sorts of delays to start appearing until much closer to the end of the reporting period on 31 December 2022.

We hope these delays improve as Te Uru Rakau gear up for the influx of applications, but there are no guarantees. If you want land registered in the ETS prior to 2023 and you have not already discussed this with us and signed up to our services, don’t delay – get in touch now!

Don’t forget if your trees are young and not visible from satellite imagery, you will need drone footage as evidence to accompany your application. This is where the bottleneck sits at present, and we eagerly await the end of the planting season and the longer / finer days of Spring so that we can ramp up drone productivity.

Price update

As previously mentioned, prices rose sharply in the early days of June following the release of the Climate Change Commissions final advice to Government getting to around $40.70 by the 15th of June (+8% from the start of the month).

The second Government auction then took place on 23rd June, with all 4.75 million NZUs clearing at $41.70. Interestingly this was almost $1 above the secondary market at the time, compared with the last auction in March that cleared $2 below the secondary market at the time.

The market reacted swiftly, trading up to $43.50 within a day of the auction, before stabilising at this level through month-end resulting in a price increase of $6.00 (+16%) for the month of June.

The action didn’t stop there though as prices continued pushing north through the start of July to a new high of $48.20. Prices have settled back a little in the last week or so, with trading (as at 21 July) around the $47.80 mark.