The areas of commercial wood plantations in Australia and New Zealand are 2.01 and 1.71 million hectares respectively, representing the predominant type of planted forest. Methods: This paper reviews the status of planted forests in Australia and New Zealand and discusses opportunities for further development taking into account economic, social and environmental factors. These factors include regional wood demand and supply conditions, emerging markets for ecosystem services, climate change

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... acts and social attitudes toward planted forests. Results: Both countries have followed a similar pattern of state intervention for the development of wood plantations, relying on government ownership and direct incentives such as taxation concessions that have gradually shifted to the use of more indirect policies. The main drivers for wood plantations were as an additional source of wood outside the natural forest, improved productivity and regional development. More recent policy has focused on the privatisation of forest assets and the promotion of ecosystem services such as carbon sequestration. To date, plantings for ecosystem services such as carbon sequestration has been limited. Conclusions: It is argued that better design of policy settings is needed to capture the carbon abatement benefits and other ecosystem services from planted forests, which may help overcome current investment hurdles. Careful attention will also need to be applied to managing future climate change risks as well as to realising the opportunities from forecast growth in wood and fibre product demand particularly in the Asian region.