Contributed by: Don Winner#Panama By DON WINNER for Panama-Guide.com - In the past few months I've been working with Jeff Duda, the President of Panama Teak Forestry to help develop a marketing and publicity strategy for their plantation teak in Panama. The more I learn about this business, the more I like it, for two primary reasons. First of all, teak is a very valuable tropical hardwood, used in marine applications such as boats and decking. Teak is also used to build outdoor furniture, as well as a flooring and deck material used for higher end homes. It's a pretty wood, it's durable, and most importantly it can stand up to the harsh outdoor environments - rain, snow, and saltwater - and it won't rot. Teak trees have evolved in the relatively rough neighborhood of the tropical rain forest, and has developed natural defenses against insects, mold, mildew, fungus, and rot. As such, teak wood and lumber is relatively expensive on the retail market. Outdoor furniture made of teak is some of the most expensive on the market, precisely because these pieces are considered to be "instant heirlooms" (because they are going to out live all of us.) So that's the first reason why I like this business - it's profitable. Of course it takes a long time for a newly planted teak tree to grow to maturity, 25 years or so, so it's a long term investment. And a lot of people have learned the hard way that you can't just "plant it and forget it". A forest of value has to be intensively managed and monitored - if not it's practically worthless. Anyway, the plantation teak trees being grown and professionally managed by Panama Teak Forestry represent a whole lot of potential profit. And the important question from an environmental point of view - How much carbon dioxide are all those plantation teak trees in Panama sequestering (removing) from the atmosphere? (more)
Environmentally Sound: Anyone who has read this website for a long time probably knows my stance on most environmental issues. I strongly believe there are ways to conduct business and make money in a manner that's both profitable and environmentally sound. Anything you do in the woods is going to have some kind of an impact, even if you're just walking down a trail and taking pictures. In the case of Panama Teak Forestry, they start by buying property that was being used as cattle grazing land. They then plant 1,100 teak tree seedlings per hectare - they have already planted more than 500,000 trees. The fertilizers they use are organic, long lasting, and slow release. For most food crops you need a quick shot of fertilizers so the corn (or whatever) will grow, but it's different with trees. They need healthy soil for 25 years or more. Panama Teak Forestry makes great effort to improve the soil over the very long haul. Every scrap of sawdust, trimmings, and shredded bark from the saw mill is composted (using organic composting "tea pots") to create natural fertilizers that are spread back out throughout the plantations. Nothing is burned - it's all put back into the soil. They run cattle and sheep under the trees to trim back the undergrowth because it's better than sending in a man with a machete or a guy with a gas powered weed-wacker. They ride horses instead of using motorcycles or ATV's. Everywhere you look they make managerial decisions that are both good for the teak as well as the environment. It's a philosophy held by company president Jeff Duda that spreads down throughout the entire organization almost like a sort of "green religion" - and their 250 Panamanian employees who are slowly becoming converts.
Carbon Sequestration and Plantation Teak: Have you seen a teak tree? They have these huge leaves and they grow very quickly when pampered, and when they have access to the proper mixtures of sunlight, water, and minerals. You can view each individual teak tree as a sort of "carbon sink." Through the process of photosynthesis the trees are sucking carbon dioxide out of the air, sequestering the carbon, and releasing the oxygen back into the atmosphere. The carbon remains behind in the form of the wood in the teak tree (thank you very much). And as I spend more and more time on the teak plantations I started thinking - Exactly how much of an impact is this having? How much carbon dioxide does each teak tree sequester? What's the math? What are the numbers? My curiosity was piqued.
It's Chemistry - Ask Dad: As usual, when I want to know something based on chemistry I turn to my father. He's been many things in his life, and one thing he knows coming and going is chemistry. I wanted to know - How much carbon dioxide are these trees sequestering or taking out of the atmosphere? And I also needed something that would be very simple to explain and easy to understand. I had several conversations back and forth with my Dad, and he understood what I needed. I was asking him to solve for this equation: "For every ton of teak produced by Panama Teak Forestry, they remove (x) tons of carbon dioxide from the atmosphere." Solve for X. As usual he went off for a few hours, there were some whirring and clicking noises coming from upstate New York for awhile, then he came back with the answer. The answer is "Every ton of wood is equivalent to 3.7 tons of Carbon Dioxide sequestered from the atmosphere. (3.4 tons if the wood has 8% moisture)." I went with the lower 3.4 number because Panama Teak Forestry has a kiln and the wood weighs less once the moisture is reduced (but the carbon content remains the same, obviously.)
Take It Another Step - Gas to Carbon to Wood: People understand that they are pumping gasoline into their SUV's and producing carbon dioxide - a greenhouse gas - that's released into the atmosphere. I wanted to know, how much carbon dioxide is released by burning one gallon of gasoline? And then by extrapolation - how much teak has to be grown in order to sequester that much CO2? It's 19 pounds. Burning one gallon of gasoline releases 19 pounds of CO2 into the air. You might be scratching your head at this point - because a gallon of gasoline does not weigh 19 pounds. Interestingly enough, gasoline weighs just over 6 pounds (actually 6.073 pounds) per US Gallon. Internal combustion engines take in air, it's mixed with the fuel (hydrocarbons), ignition occurs, there's an controlled explosion, and the CO2 is released. The additional weight comes from combining the oxygen in the air with the carbon when the fuel is burned. The carbon comes from the fuel, and it goes out of the tailpipe as 19 pounds of carbon dioxide. So, we can use the ratio of 3.4 (of any weigh measurement) of carbon dioxide to grow 1 (of any weight measurement) of teak. Simple enough - divide 19 pounds of carbon dioxide by 3.4 - and the answer is 5.5 pounds of teak. This makes perfect sense when you think that we started with about six pounds of gas, turned it into CO2 by running it through an internal combustion engine, then reversed the process by running it through a tree, and presto - one gallon of gas turns into 5.5 pounds of teak. Thanks, Dad. And thanks, teak tree.
What's The Real Impact: I made up this short YouTube video about this process and showed it to Jeff Duda last night. He responded by telling me that, according to their forestry engineer, the teak trees grow at a rate of about 12 cubic meters of wood, per year, per hectare. And, they have more than 550 hectares of plantation teak growing right now. That means the plantations are growing and producing 6,600 cubic meters of new teak every year. (Math required). Kiln dried teak weighs about 720 kilograms per cubic meter, or 1,587 pounds per cubic meter. So, multiplying 6,600 times 1,587 means the teak plantations of Panama Teak Forestry are currently producing (growing) 10,474,200 pounds of new teak, every year. Divide that number by 5.5 - and here's the bottom line answer; drum roll please. The teak trees growing on the plantations of Panama Teak Forestry sequester the carbon produced by the burning of 1,904,400 gallons of gasoline, every year. The average vehicle in the United States burns about 700 gallons of gasoline per year. So, the more than 1.9 million gallons worth of carbon dioxide sequestered by the plantation teak trees in Panama represents the annual fuel consumption of about 2,720 vehicles. Enough to save the planet? No, not really. Not yet.
Expansion Plans: Panama Teak Forestry has been quietly going about their business of buying land, planting trees, and creating a "forest of value" for more than ten years. Now the sawmill is up and running. Soon the electricity will be connected to the kiln, and the company will begin to export high quality heat treated, kiln dried teak to foreign markets. They are currently seeking to undertake another expansion. The ultimate goal is to have a total of 5,000 hectares of teak planted and under management. That would allow for an annual harvest of 200 hectares of mature trees which would produce about 18 million board feet of lumber for export. In addition to that, in the same year another 200 hectares would need 18 year thinning, and another 200 hectares would need 12 year thinning, bring annual production up to about 30 million board feet per year. So if they ever get to this 5,000 hectare number - then that would be 60,000 cubic meters of new growth every year, or 95,220,000 pounds of wood, or the carbon dioxide release by the consumption of 17,312,727 gallons of gas, burned by 24,732 cars. Every year. Now we're getting somewhere.
Business, Math, And the Environment: So what's 30 million board feet of teak worth? Google it yourself, figure it out, and come up with a number. But you know what's priceless? Coming up with a business solution that makes money by (while) doing good things for the environment. Understanding this math, if you invest about $10,000 dollars you could buy about nine shares in Panama Teak Forestry, representing one new hectare of planted teak trees. These trees would grow and expand, creating 12 cubic meters of teak wood per year, or 19,044 pounds of wood, equal to 3,462 gallons of gas, or the annual consumption of about five cars. The average annual carbon footprint in the United States is 17.5 metric tons (or 38,580 pounds) of carbon dioxide, per person. This equates to about 7,000 pounds of teak. So, your $10,000 investment would effectively erase the entire annual carbon footprint of 2.7 people (in the United States), while paying for your newborn baby's college education.
Erasing Panama's Carbon Footprint: Here's another way to look at it. In Panama the average carbon footprint is only 2.2 metric tons (or 4,500 pounds) of carbon dioxide, per person. Obviously the average annual carbon footprint per person in Panama is much lower than in the United States for many reasons. Many people have cars, but many more ride buses or public transportation. Some homes and offices are air conditioned, but most Panamanians can go their entire day without setting foot in a space that's either heated or air conditioned. The 550 hectares of plantation teak already being grown by Panama Teak Forestry creates or produces 10,474,200 pounds of new teak, per year, every year. This represents the sequestration of 35,612,280 pounds of carbon dioxide from the atmosphere. Therefore, the teak plantations are already sequestering the entire carbon footprint of 7,913 Panamanians, every year.
If You Would Like To Know More: If you would like more information about investment opportunities in Panama Teak Forestry write me at email@example.com. And for more information you can check out:
Copyright 2011 by Don Winner for Panama-Guide.com. Go ahead and use whatever you like as long as you credit the source. Salud.