MAJOR PAPER COS FORM FORESTRY BIOTECH VENTURE
Date: 08-Apr-99
Country: USA
The companies, Fletcher Challenge Forests , International Paper , Monsanto Co and Westvaco Corp , said the joint venture will produce and market tree seedlings, focusing on the majority of those now planted by the forest industry.
The companies said as international demand for wood and fiber increases, there will be significant business opportunities for additional breakthroughs in forestry science.
Among the genetic improvements aimed at by the joint venture are higher growth rates to allow more wood to be grown on less land and improved fiber quality to increase efficiency in paper.
"These improvements are expected to enable forest landowners to meet the growing demand for paper and wood products while strengthening their ability to manage forest lands in a sustainable and eco-efficient manner for the benefit of future generations," the companies said in a joint statement.
The companies also said they intend to contract with Genesis Research and Development Corp Ltd, an Auckland, New Zealand, biotechnology research company, to provide forestry genomics research, which is the study of genes to identify desirable traits.
Details of that transaction were not disclosed.
According to the International Union of Forestry Research Organisation, the demand for wood products is expected to increase 42 percent from 1996 to 2010 due to population growth.
The paper industry in general, however, has been on hard times over the past years because of overcapacity which has forced prices downward. That trend has reversed in the past several weeks due to plant downtime, which has shrunk inventories.
A spokeswoman for Monsanto said the joint venture is expected to become commercial around 2005 to 2007.