African Mahogany Australia - Quaterly Management Report June 2020

African Mahogany Australia

QUARTERLY MANAGEMENT REPORT for

Cremorne Capital Ltd ATF HVT Land Trust

June Quarter FY20

1 April 2020 – 30 June 2020

July, 2020 CC/HVT Quarterly Management Report – April-June, 2020

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Contents 1.

Operations Summary ...............................................................................................................................3

2.

Area Statement ........................................................................................................................................4

3.

4.

2.1

2007 Age Class ................................................................................................................................4

2.2

2008 Age Class ................................................................................................................................4

Operational Activities...............................................................................................................................5 3.1

Thinning ..........................................................................................................................................5

3.2

Grazing............................................................................................................................................6

3.3

Hay operations ...............................................................................................................................7

3.4

Silviculture and nutrition R&D ......................................................................................................8

3.5

Fire management ...........................................................................................................................8

Other Activities ........................................................................................................................................9 4.1

ESG activity – April-June, 2020. .....................................................................................................9

Key areas of activity: ........................................................................................................................................9 Community Support ....................................................................................................................................9 Strategic business development. ...............................................................................................................9 Environment:...............................................................................................................................................9

CC/HVT Quarterly Management Report – April-June, 2020

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1.

Operations Summary

This Quarterly Report for the June Quarter is presented in accordance with the requirements of the Management Agreement. It encompasses the period from 1 April, 2020 to 30 June, 2020.

The main operations conducted throughout the reporting period was harvesting of the hay crop, hay sales, early dry season fire protection works and post thin operations stand monitoring Mean Douglas Daly Rainfall (past 20 years)

Month

Jan

Rain (mm)

Feb

Mar

282.7 288.5 229.6

Apr May Jun Jul Aug Sept

Oct

49.5 10.4 2.1 2.5 1.3

36.4 121.4 213.7 1245.8

5.4

Nov

Dec Annual

Rainfall recorded in the Douglas Daly shows the following measurements for 2018/19 season YTD: July 19

Aug 19

Sept 19

Oct 19

Nov 19

Dec 19

Jan 20

Feb 20

Mar 20

April 20

May 20

June 20

full year

Rainfall (mm)

0

0

0

10.2

57

105

238.8

275.8

108.6

62.8

3.4

0

861.6

Rain days

0

0

0

3

6

16

21

21

8

5

1

0

81

Month

Q4 saw the completion of the wet 2019/20 and rainfall total was 31% below average. This had a minor effect on hay yield, but due to late rainfall in the season in April, the crop was able to finish off.

CC/HVT Quarterly Management Report – April-June, 2020

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2.

Area Statement

The area of the Whatfor property is 3207 ha. Land use is summarised in table 1 below

Table 1: Landuse summary, Whatfor Station.

Landuse Mahogany Plantation Mahogany Plantation Cavalcade hay paddock Native/utilities Gross Total

Age class 2007 2008 2019 n/a

Area (ha) 1104.0 415.4 136.0 1,551.6 3,207.0

Note: These areas are as per the Margules Groome valuation undertaken in August, 2018.

2.1

2007 Age Class

The 2007 age class is generally in good health.

Areas that have been thinned and then fertilised have responded well to this treatment. Grazing has continued throughout the year and this has had a positive effect on the plantation and weed growth.

General plantation health is good.

2.2

2008 Age Class

Like the 2007 age class, all stands that have had recent intervention and fertilisation have responded well and continue to grow and occupy the site well. Grazing has limited weeds, fire risk and increased nutrient cycling on the plantation.

General plantation health is good.

CC/HVT Quarterly Management Report – April-June, 2020

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3.

Operational Activities

3.1

Thinning

The thinning regime is to reduce stems at first thinning to between 250-300sph. This approach has been established by applying knowledge gained from several research trials undertaken throughout the mahogany estate by AMA. Pre-thinning selection and marking is undertaken to assist in selection quality – this is a critical operation which will determine which trees will grow on to be final crop trees. This operation also serves to increase the speed in which manual falling crews can complete thinning in any given area.

262ha have been completed in FY20. Fertiliser was applied to these areas in November and stands have responded well after some rain.

Table1: Thinning program FY20 Property Name What For What For What For What For What For What For

Block Name

Planting Year

11a 12a 14a 13a 15a 3a

2008 2008 2008 2008 2008 2007

CC/HVT Quarterly Management Report – April-June, 2020

Area Treated (ha) 17.4 25.1 102.1 15.5 75.0 27 262.0

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3.2

Grazing

The grazing program continued in the Dec Quarter, with 300 head of mixed northern Australian cattle grazing throughout Whatfor, reducing grass competition and fire risk in the dry season, increasing nutrient cycling throughout the plantation and optimising land use productivity (timber and beef production). Some of this income has been invested into cattle infrastructure to increase holding capacity.

Cattle grazing at Whatfor.

CC/HVT Quarterly Management Report – April-June, 2020

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3.3

Hay operations

125ha of cavalcade hay (higher grade legume hay) was established and grown in the wet season.

This activity is undertaken to generate cash to contribute toward essential value adding plantation management activities such as thinning and fertilising.

Yields were pleasing despite the lighter than average rain received throughout the wet season. 807t was produced off 125ha, averaging 6.5t/ha.

All hay has been sold and at the time of reporting 500t had been removed and paid for.

Loaded cavalcade, 2019/20 hay season

CC/HVT Quarterly Management Report – April-June, 2020

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3.4

Silviculture and nutrition R&D

The silviculture, nutrition and wood quality research project that has been undertaken for the past 4 years finally wound up at the end of the quarter. This project is now a cornerstone to the management, processing, and marketing of khaya in the Northern Territory. With this information, significant value will be added to the current and future crops of this timber species.

Images from the processing component of the research project – mahogany logs being peeled at the wood science facility in Salisbury – Queensland.

3.5

Fire management

Early dry season is critical to ensure the vulnerable boundaries surrounding the Whatfor plantation are secured prior to the hot, dry winds of July-September commence. AMA have undertaken fuel reduction burning, roadside verge burning and strategic firebreak maintenance to minimise risk during the 2020 fire season.

Entrance to Whatfor property showing roadside verge burning complete CC/HVT Quarterly Management Report – April-June, 2020

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4.

Other Activities

4.1

ESG activity – April-June, 2020.

The June quarter was another active quarter and below is an excerpt from the AMA ESG database.

It encompasses all funds and properties under management and where “All” of “Multiple”, is mentioned, this relates to areas of engagement that are relevant to all Properties under management.

Key areas of activity: Community Support: Chris Oliver continued close community interactions in the Douglas Daly with attendances to community working bees, meetings to assist in increased infrastructure for the region (communications and firefighting capacity), and fuel reduction burning with TO and neighbouring land owners and fire fighting for neighbours

Strategic business development.

Frank Miller continued to drive the development of the NT Forestry Association – this will give a stronger voice for the mahogany project into government when lobbying for key infrastructure such as roads and power in the Douglas Daly.

Frank Miller commenced working with neighbouring sandalwood manager Quintis in finding synergies with contractors to assist in more efficient delivery of works, particularly during Covid restrictions.

Chris Oliver and Frank Miller spoke with a farm management system developer (Conservis) to investigate a more efficient farm management for hay growing entities.

Environment: Research toward silvopastoralism and legume hay production is being considered that aim to offer environmental benefits through lowering inputs.

Feral animal control continued through the estate.

CC/HVT Quarterly Management Report – April-June, 2020

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Date 3/04/2020 1/04/2020

3/04/2020

Environment

Feral Animal Control

Social Community Volunteering

Fire management Community Fire Protection and mitigation

Recreational Hunting Inter/intraIndustry Collaboration Community Volunteering

27/04/2020

Fire management Community Fire Protection and mitigation

14/04/2020

27/04/2020

Governance

Entity (where relevant) All PTT

All

Government/ Regulatory

PTT

STA

Crop performance

Government/ Regulatory

HVT

All

Government/ Regulatory

STA

Fire management Community Fire Protection and mitigation Community interaction

27/04/2020

11/05/2020

N/A

All

FLO

All Technology

Community interaction

Community interaction Community Volunteering

25/05/2020 26/05/2020 27/05/2020 13/06/2020

N/A

N/A

Gypsy Springs

N/A

Chris Oliver

Chris Oliver

Chris Oliver

Chris Oliver

Chris Oliver

CJO contacted Department of Parks and Wildlife to coordinate fuel management program in the Stray Creek Conservation Area

CJO contacted Department of Parks and Wildlife to coordinate fuel management program in the Stray Creek Conservation Area

CJO attended committee meeting of the DDVBB

Collaboration with Quintis re: Fall Army Worm potential threat to Khaya plantations

CJO attended committee meeting of the DDVBB Registered hunters undertook hunting activities for feral pigs on Gyspsy Springs - numerous feral animals have been controlled in Q2

Details reference (doument title)

Mentabie

Chris Oliver

AMA Representative

Gypsy Springs

Chris Oliver

Property

Whatfor

Chris Oliver

CJO contacted Department of Parks and Wildlife to coordinate fuel management program in the Stray Creek Conservation Area CJO in contact with Katherine Carver (Wagiman Rangers) to discuss upcoming planned burning program of the indigenous landowners near Mentabie CJO delivered rough sawn mahogany timber to Clontaf Academy. Students from Clontarf will utilize this timber in their woodwork classes.

FM and CJO held a conference call with Conservis Ag. to rteview their farm management software.

CJO attended a community meeting with representatives from Telstra to discuss the Douglas Daly needs for improved telecommunications.

Frank Miller

Chris Oliver

Chris Oliver

Cjo attended a working bee for the Douglas-Daly Campdraft

Mentabie

Rocktear

Chris Oliver

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CC/HVT Quarterly Management Report – April-June, 2020

Date Environment Social Governance

Technology

Entity (where relevant) All

STA

17/06/2020

Fire management and mitigation

N/A

23-25/6/2020

Business Development All

All

Health and Safety

All

All

Crop performance All

Government/ Regulatory

Suppier/Contractor All relations

Other

HVT

Sponsorship Inter/intraIndustry Collaboration Inter/intraIndustry Collaboration

Fire management and mitigation

Chemical Reduction

Other

23-25/6/2020 26/06/2020 28/06/2020

1/1-30/6/2020

1/05/2020 20/03/2020 1/1-30/6/20 1/05/2020 30/06/2020

AMA Representative

Chris Oliver

Property

Mentabie

Chris Oliver

Chris Oliver

Whatfor

Multiple

Multiple

Multiple

Multiple

Multiple

N/A

Frank Miller

Frank Miller

Frank Miller

Frank Miller

Frank Miller

Frank Miller

Frank Miller

Chris Oliver

Multiple

Details reference (doument title)

CJO held a conference call with Gabriel Llobet (Treevia) to discuss their Smartforest Agility and Smartforest High Precision IOT solutions.

CJO coordinated and assisted in fuel management burns in the Stray Creek Conservation Area with representatives from Parkjs and Wildlfe and members of the DDVBB CJO coordinated and assisted in fuel management burns in the Stray Creek Conservation Area with representatives from Parkjs and Wildlfe and members of the DDVBB CJO attended the NT Farmerrs lead cotton field day in the Douglas Daly region.

AMA sonsored the Douglas Daly campraft - a popular and important community event FM has driven the creation of FIANT - Forest Industry Association Northern Territory for more effective voice to governement for the khaya project - recently nominated as President FM working directly with neighbouring Sandalwood manager to ensure that synergies can be found in contractor availability resulting in getting work completed efficiently Covid-19 plan devised and workforce operating safely under relaxed Covid-19 restrictions in the NT FM continues to work with TNRM and head industry advisor for the Forest Industry Code of Practice Frank Miller working with Maldi-ID, a research firm which specialise in legume crop performance and inocculation FM applying for research funding into Silvopastoral systems which will guide future khaya investments and add value to existing plantations

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CC/HVT Quarterly Management Report – April-June, 2020

The Douglas Daly Volunteer Bushfire Brigade supported by AMA.

CC/HVT Quarterly Management Report – April-June, 2020

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