J.P. Morgan Asset Management’s Timber-Investing Arm Acquires 250,000 Acres of Southern Pine

Fox Business reported Wednesday (2-1-23) that J.P. Morgan Asset Management’s timber-investing arm has acquired 250,000 acres in the Southern pine belt for more than $500 million, marking Wall Street’s latest big woodland purchase made with an eye toward carbon markets.

The wealth manager said its Campbell Global unit, which invests on behalf of pension funds, foundations, and other institutional investors, will manage the commercial forests in Mississippi, Oklahoma, and Arkansas for wood production as well as carbon capture.

“For large timberland purchases, carbon is an integral part of valuation, just as timber is. Management of these lands longer term is a balance of wood harvesting and carbon capture,” Anton Pil, head of alternatives for J.P. Morgan Asset Management, which manages $2.45 trillion and acquired Campbell in 2021, told Fox Business.

Carbon capture is usually accomplished with less logging. Companies eager to make up for their emissions are paying timberland owners to leave their trees standing so they can absorb carbon from the atmosphere as they grow. Such deals generate tradable instruments called carbon offsets.

The pricing of carbon, along with mounting corporate pledges to operate without adding greenhouse gases to the atmosphere, has prompted investors to reevaluate the value of timberlands and place long-term wagers on woodlands that are based on more than just what logs might be worth going to the sawmill.

In December, one of the country’s largest timberland owners, Manulife Investment Management, said it was aiming to raise $500 million to buy properties where sequestering the carbon in standing trees will be prioritized over cutting them down to make wood products.