ArborGen is a global leader in the commercialization of advanced forestry genetics. Through the application of a proprietary technology platform to its extensive forestry germplasm base, ArborGen develops and produces high value plantation tree seedlings that generate a step-change in forestry productivity. These seedlings are sold to land owners and managers in many of the world’s largest and fastest growing forestry markets.
ArborGen has a strong market position with over 7,000 active customers, including many of the largest forest land owners and managers in the United States, New Zealand, Brazil and Australia. In 2014, ArborGen sold 265 million seedlings, making it one of the largest providers of tree seedlings to the commercial forestry industry in the world. Its products, sold under the ArborGen and SuperTree Seedlings brand names, are developed for land owners and managers supplying the sawtimber, plywood and other structural wood products, pulp and paper, and industrial charcoal markets. ArborGen’s current focus is on loblolly pine, radiata pine and eucalyptus, which are among the most widely-planted commercial species in the world.
ArborGen’s proprietary technology platform enables it to be the only commercial seedling company with products spanning a broad technology spectrum. It sells conventional seedling products developed using traditional plant breeding methods, as well as proprietary next-generation seedling products developed using advanced plant breeding technologies (including genomics) and clonal propagation. Its next-generation products are designed to enhance customers’ financial returns by improving the growth rates, yields, log quality, stress-tolerance, uniformity and processing efficiency of trees, and enable it to create and capture greater value than with conventional products. By way of example, based on field trial data, as compared with industry standard conventional seedlings, land owners and managers are able to use ArborGen’s next-generation loblolly pine product to grow up to four times as much sawtimber per acre, which currently sells at prices that are two to four times higher than pulpwood.
ArborGen’s product development pipeline includes improved versions of these next-generation seedling products as well as transgenic seedling products, which are seedling products with specific genes introduced to enhance targeted traits. Other than certain eucalyptus products under development using transgenic techniques, none of its products on the market or under development require any regulatory review or approval.
ArborGen believes it has the broadest portfolio of intellectual property in its industry, as well as the largest and most diverse repositories of germplasm, encompassing more than 40 commercial tree species and hybrids. It operates an extensive field trial system and are currently conducting over 900 field trials containing over 1 million trees. It is using genomics technology in pine, and its biotechnology capabilities in eucalyptus, to further accelerate and enhance its tree improvement programs. Its technology platform combines the on-going efforts of its product development and research teams with over 100 years in the aggregate of tree improvement research by its industry leading shareholders: International Paper Company, MeadWestvaco Corporation and Rubicon Limited.
ArborGen is applying a business model similar to the model that has been successfully used in agriculture, where seed companies have introduced genetically-improved crops that have dramatically improved the economics of their production as compared to their conventional seed competitors. Through increased pricing, these seed companies are sharing in the higher value their advanced products create for their customers. Although there are differences between the forestry industry and agriculture, such as increased rotation length for trees as compared to agricultural crops, ArborGen believes its next-generation seedlings will have an impact on the productivity and economics of the commercial forestry industry similar to the impact that genetically-improved crops have had on the agricultural industry. ArborGen is focused on driving these improved economics by transitioning its customers from conventional seedling products to its next-generation products. ArborGen’s next-generation products accounted for 12%, 15% and 22% of total seedling sales by volume in the years ended March 31, 2012, 2013 and 2014, respectively.
ArborGen plans to leverage these efforts by using its improved products to increase share in those markets in which it is already established. It is also expanding into new markets and geographies, where its products, technology and partners position it for rapid growth. ArborGen recently entered the Brazilian pine and eucalyptus markets and are currently exploring other markets such as China.
ArborGen has 160 employees and owned or leased 15 nurseries, 16 seed orchards, 32 distribution centers and three research and development facilities located throughout the Southern United States, New Zealand, Australia and Brazil.
ArborGen's website is www.arborgen.com.
Luke Moriarty and Dr Bruce Burton (Senior Vice President of Rubicon) serve on the ArborGen board of directors.