Why Invest in Quintis
An investment in Quintis enables you to take advantage of our position as the world’s largest sustainable grower, producer and marketer of Sandalwood Album with access to emerging global markets for our super ingredient.
Quintis Sandalwood Album® is a high value product in high demand. Heartwood has recently sold for approximately AUS$80,000 per tonne and has many uses across pharma, skincare and wellbeing applications.
Our experience spans two decades. Our specialist knowledge has allowed us to deliver the highest quality product to the world. Indian Sandalwood is a difficult tree to grow and manage, with the slow growth cycle and IP relating to cultivation making a barrier to entry for competitors.
An investment in Sandalwood diversifies your investment portfolio with a secure and proven agribusiness commodity.
We've invested in research and development to differentiate our products in global markets and have created an exclusive supply of pharmaceutical-grade sandalwood oil.
Our balance sheet is strong, with a secured end market of diverse customers.
Investments in sandalwood can be tax effective.
Why Sandalwood Album?
Indian sandalwood grown by Quintis is referred to as Sandalwood Album as it represents the only sustainable and legal supply of the commodity in the world. Indian Sandalwood is one of the world’s longest traded commodities and most valuable tropical hardwoods.
- The Sandalwood Album wood produced from the Quintis managed plantations, form the foundation for two highly valuable core end products – pure heartwood and oil.
- The heartwood and oil have multiple uses and centres of demand across ceremonial and worship, fine fragrance and pharmaceutical sectors.
- Supply of Indian sandalwood has been falling consistently for many years. This is due to reducing official harvests by the Indian Government, the over-harvesting of native supplies and the lack of a meaningful sustainable plantations outside of Quintis.
- Quintis is a fully integrated Sandalwood Album company, best placed to add value and maximise the opportunity presented by these exceptional demand / supply dynamics.
- Quintis has represented its ability to achieve a significant price for its supply of Sandalwood Album beyond that initially anticipated.
What are the primary steps in establishing a Sandalwood Album plantation?
The primary steps in the successful execution of a Sandalwood Album project are:
- Identification and securing of appropriate land
- Land assessment due diligence process includes detailed consideration of factors such as geographic / climatic / rainfall analysis, soil mapping to determine suitability for Indian sandalwood, water availability & security.
- Land preparation
- Process includes sub-division, soil testing, soil leveling and general preparation and irrigation (access and installation).
- Seed germination and seedling cultivation
- Quintis’ tree breeding program has seen improvement in the genetic stock of Sandalwood seeds.
- Only the best seeds are planted. Ongoing monitoring during early seedling growth ensures only those seedlings with straight root lines are potted, maximising their survival and growth potential.
- Pot hosts are introduced at the nursery and only released for planting once the parasitic connection is established.
- Result is improved germination rates at the TFS nursery and ensuring the planting of only the healthiest and most robust seedlings.
- After 19 years, Quintis has developed a clear understanding of optimal planting times and processes.
- Advanced knowledge of host tree selection, tree types and planting configuration has had a marked positive impact on survival rates.
- On going management
- Optimise irrigation schedules for each tree vintage.
- Fine-tuned silvicultural practices including, but not limited to, irrigation, pruning, weed control and general plantation maintenance.
- Quintis’ first commercial harvest commenced in September 2013, and recently completed the third harvest in 2016, with the processes developed proving to be both effective and efficient.
Is the investment Tax deductible? Why?
Yes, the investment is tax deductible. TFS has been issued a Product Ruling from the Australian Taxation Office which confirms the expenditure satisfies Division 394 of the Income Tax Assessment Act 1997.
How is my return calculated?
Details of the anticipated return are discussed in more detail in the investment offer documents. The return will be based on a range of factors including tree survival rates, the quantity of heartwood in the trees you own, the price for the heartwood and whether you have deferred or paid your annual fees
Can my plantation be insured?
Yes. Plantation insurance is available to protect against certain risk factors. More detail is available in the investment documentation
What do I actually own when I invest?
When you invest in the project, you acquire rights to a proportionate interest in the forest produce (as defined) produced from the entire plantation.
What is the rationale behind the planting location of the trees?
The geographic focus for Quintis is the tropical region of Australia, specifically land that is suited to the growth of Sandalwood Album. The Quintis land due diligence team only considers land with following attributes:
- Ability to gain clear title
- Access to goods, services & staff
- Access to ample, consistent and secure water supply
- Excellent soil drainage
- Intensive soil testing of soil chemical and physical properties completed
- This strategy has been undertaken to ensure Quintis has access to the most suitable land and to broaden the company’s geographic exposure, thereby reducing risks inherent in a single plantation region.
- Quintis has completed freehold and leasehold land acquisitions near the town of Kununurra in Western Australia, within the Burdekin region of Northern Queensland, and in the Northern Territory. Quintis established the first plantations in the Northern Territory and Queensland in 2012.
- Quintis is continually evaluating new land acquisition opportunities and aims to hold a land bank of approximately 2 years planting at any time.
Please outline the major agricultural risks for this investment
- All plantations have been designed to minimise fire risk, with the inclusion of fire breaks and consideration of prevailing winds.
- TFS has fire prevention measures in place with plantation staff equipped with light duty fire-fighting equipment and receive training in fire prevention and firefighting.
- Although plantations managed by TFS have not experienced any damaging wildfires, TFS recommends investors insure their Sandalwood Plantations.
Cyclones / Severe Winds:
- Existing Plantations have not experienced any cyclones or cyclone damage.
- Owing to the inland location of existing plantations in the Kimberley Region, Northern Territory and Queensland it is generally expected that cyclonic activities will dissipate to rain-bearing depression.
- Land acquired by TFS is subject to land acquisition due diligence protocols. These include the need to be located sufficiently inland to be less susceptible to any cyclone damage.
- Thunderstorms and strong winds represent a risk that can result in tree damage. The history of Indian sandalwood plantations in Australia has shown that plantations have been resilient to high winds.
- Even so, to mitigate this risk TFS follows a policy of planting host species along the more exposed edge of the plantations to shelter the Sandalwood trees from high winds.
- Most of the preferential soil types are located on flood plains, so flooding can be a risk.
- It is very unlikely that any floods would be of a moving nature sufficient to cause direct damage.
- In almost all cases, good drainage ensures excess water will be dispersed quickly to ensure no long term damage to the trees.
- TFS’ plantation design and site preparation includes the creation of appropriate land falls to ensure adequate drainage and dispersal of excess water during wet seasons.
- As all our plantations are irrigated, and have access to long term, secure water supplies, the impact of droughts is minimal.
- Drought conditions in Australia are more likely in the southern, more arid part of the country.
- TFS’ plantations are located in the sub-tropical north where the risk of drought is far lower.
Other Physical Risks:
- A number of other physical risks such as disease, insects, weeds and other pests can affect the plantation and a strict plantation management plan is in place to mitigate these risks to the extent possible.
For institutions looking to widen their asset portfolio in the alternative investment class.