scholarly journals Evaluating the effects of risk on the economics of juvenile spacing and commercial thinning

1991 ◽  
Vol 21 (9) ◽  
pp. 1390-1400 ◽  
Author(s):  
William J. Reed ◽  
Joseph Apaloo
Keyword(s):  
Net Present Value ◽  
Fire Hazard ◽  
Fire Risk ◽  
Economic Benefits ◽  
Present Value ◽  
Expectation Value ◽  
Commercial Thinning ◽  
Land Expectation Value ◽  
Optimal Rotation ◽  
Rotation Age

The temporarily increased fire hazard that is believed to result from the process of thinning is included in a single-stand model for assessing the economic benefits of juvenile spacing. Formulas for the expected net present value and the land expectation value are given along with methods for determining the age of financial maturity and the optimal rotation age. A numerical example is given to illustrate the degree of loss due to the increased fire risk. The problem of commercial thinning when the risk of fire is present is addressed using continuous-time models. It is shown how, when the fire hazard is exogenous to the thinning activity, the problem reduces to one of deterministic optimal control with the discount rate adjusted upward by an amount equal to the fire hazard rate. In the case when the fire hazard increases whenever thinning is taking place, it is shown that in general the optimal thinning policy is qualitatively different from that which is optimal in the no-risk case and involves periods of thinning at the maximum rate interspersed with periods of no thinning activity.

scholarly journals The Optimal Forest Management of an Even-Aged Stand: The Biological Rotation versus the Land Expectation Value

EDIS ◽  
2019 ◽  
Vol 2019 (6) ◽  
pp. 4
Author(s):  
Andres Susaeta ◽  
Chris Demers
Keyword(s):  
Forest Management ◽  
Investment Decisions ◽  
Forest Resources ◽  
Forest Stands ◽  
Forest Landowners ◽  
Expectation Value ◽  
Fact Sheet ◽  
Land Expectation Value ◽  
Optimal Rotation ◽  
Rotation Age

This 4-page fact sheet written by Andres Susaeta and Chris Demers and published by the UF/IFAS School of Forest Resources and Conservation provides a guide for forest landowners, managers, and stakeholders in conducting a valuation of timber investments. It reviews and provides examples of two different approaches for determining the optimal rotation age of even-aged forest stands. These methods can help forest landowners and managers in making forestry investment decisions. https://edis.ifas.ufl.edu/fr424

Assessing the long-run yield of a forest stand subject to the risk of fire

1985 ◽  
Vol 15 (4) ◽  
pp. 680-687 ◽  
Author(s):  
W. J. Reed ◽  
D. Errico
Keyword(s):  
British Columbia ◽  
Forest Fire ◽  
Forest Stand ◽  
Expectation Value ◽  
Long Run ◽  
Land Expectation Value ◽  
Optimal Rotation ◽  
Graphical Technique ◽  
Rotation Age ◽  
Theoretical Results

The problem of determining the effects of forest fire on stand yields is often neglected in forest yield analyses. Using previous theoretical results, "fire-adjusted, volume–rotation curves" can be developed which provide a graphical technique for determining optimal rotation age and long-run yield when the risk of fire is present. For white spruce of the northern interior of British Columbia it is shown that even modest rates of fire can result in very large reductions in long-run yield. Similar results are established for the effects of fire on land expectation value, which is dissipated very quickly under the risk of fire.

Optimal forest management for timber value and carbon sequestration benefits in tropical planted forests: a case study of household foresters in Vietnam

2014 ◽  
Vol 20 (6) ◽  
pp. 746-766 ◽  
Author(s):  
Nhung Nghiem
Keyword(s):  
Carbon Sequestration ◽  
Forest Management ◽  
Management Practices ◽  
Net Present Value ◽  
Acacia Mangium ◽  
Economic Benefits ◽  
Planted Forests ◽  
Financial Status ◽  
Optimal Rotation ◽  
Rotation Age

AbstractEnhancing carbon sequestration is crucial to mitigate rising global levels of greenhouse gases, and for developing countries, carbon sequestration may also provide economic benefits via international carbon trading schemes. This study aimed to determine the optimal management strategy for tropical planted forests when timber and carbon sequestration are valued. The survey data were collected from 291 household foresters, who were growing Eucalyptus urophylla and Acacia mangium in Yen Bai Province, Vietnam. The regression exercise suggests that financial status was negatively correlated with forest management practices, and ethnicity and financial status were correlated with carbon sequestration management. The survey results suggest that the mean rotation age employed by household foresters is five years. However, the optimization modelling suggests that the optimal rotation age for maximizing net present value is greater than nine years. The differences between current practices and optimal practices therefore favour a role for government policy interventions.

scholarly journals Financial analysis of Chir pine plantations for carbon offsets, timber and resin in Nepal

2013 ◽  
Vol 22 (2) ◽  
pp. 3-10 ◽  
Author(s):  
B KC ◽  
G. A. Stainback
Keyword(s):  
Financial Analysis ◽  
Pine Plantations ◽  
Pinus Roxburghii ◽  
Expectation Value ◽  
Land Expectation Value ◽  
Optimal Rotation ◽  
Carbon Offset ◽  
Rotation Age ◽  
Chir Pine ◽  
Substantial Change

A financial analysis was done for Chir pine (Pinus roxburghii) plantations that produce carbon offset payments, timber and resin in a community forest context in Nepal. Results indicate that the inclusion of carbon offset payments increases rotation age and land expectation value. The optimal rotation age is approximately 35 years without including carbon offset payments, while the rotation age can increase beyond 75 years with the inclusion of carbon offset payments. The substantial change in optimal rotation age also suggests that carbon offset payments will likely change the product mix produced from Chir pine plantations. Likewise, land expectation value increases significantly with carbon offset payments indicating that local communities could benefit from such payments. The results also indicate that different assumptions about the quantity of long term carbon storage (i.e. pickling rate) have a significant impact on rotation age and land expectation value.DOI: http://dx.doi.org/10.3126/banko.v22i2.9193Banko Janakari: A Journal of Forestry Information for NepalVol. 22, No. 2, 2012 NovemberPage: 3-10Uploaded date: 12/1/2013 

scholarly journals The Economic Benefits of Malaysian University Degrees

2020 ◽  
Vol 7 (1) ◽  
pp. 15-25
Author(s):  
Mohd Nahar Mohd Arshad ◽  
Nur Nadhira Baharuddin
Keyword(s):  
Human Capital ◽  
Capital Investment ◽  
Net Present Value ◽  
Economic Benefits ◽  
Degree Programs ◽  
Educational Investment ◽  
Present Value ◽  
Public And Private ◽  
Net Returns ◽  
The Individual

AbstractThis study analyzes the net returns of educational investment in Malaysia using the net present value approach. The estimations consider the tuition payments of nine different bachelor degree programs of public and private universities in Malaysia and the forgone earnings while undertaking the degree programs as the cost of investments in human capital. The returns to education investment are based on the expected income accrued by the individual over the employment period until retirement. Under the assumptions that an individual would work until the retirement age of 60 years and a discount rate of 4 percent, the estimations show that holding a computer science degree from Universiti Sains Malaysia would give the highest net present value. Holding a medical degree, in general, would give the lowest net returns on educational investment as compared to the other selected programs. The net returns are sensitive to the costs of education, earnings and the duration of undertaking the degree programs.Keywords: Human capital investment, net present value, private rate of return, educational investment, Malaysian degree programmes

scholarly journals Economic Viability and Socio-Environmental Impacts of Solar Home Systems for Off-Grid Rural Electrification in Bangladesh

Energies ◽  
2020 ◽  
Vol 13 (3) ◽  
pp. 679 ◽  
Author(s):  
Swati Anindita Sarker ◽  
Shouyang Wang ◽  
K M Mehedi Adnan ◽  
Muhammad Khalid Anser ◽  
Zeraibi Ayoub ◽  
...  
Keyword(s):  
Environmental Impacts ◽  
Low Income ◽  
Net Present Value ◽  
Economic Benefits ◽  
High Rate ◽  
Economic Viability ◽  
Internal Rate Of Return ◽  
Present Value ◽  
Viable Option ◽  
Home Systems

This study conducted a questionnaire-led survey to explore the financial feasibility and socio-environmental impacts of stand-alone solar home systems (SHS) through stratified random sampling. Based on the above consideration, fifteen cases of studies of various watt peak (Wp) capacities have been investigated to evaluate the economic viability of solar home systems. The results revealed that most of the cases have positive net present value (NPV) and low payback periods, with an internal rate of return (IRR) value ranging from 16% to 131%, which signifies a high rate of investment exchange. Solar home systems are economically profitable for micro-enterprises and households with low-income generation activities as opposed to the households using it only for lighting. The study found that solar home systems with a capacity above 30 Wp are the most economically viable option, which can also avoid 6.15 to 7.34 tonnes of CO2 emissions during the 20 years of life-cycle, while providing different applications including lighting, recreation, information, health, and economic benefits.

Economic analysis of a hypothetical bamboo-biochar plant in Zhejiang province, China

2017 ◽  
Vol 35 (12) ◽  
pp. 1220-1225 ◽  
Author(s):  
Tao Zhang ◽  
Fang Liang ◽  
Wanhe Hu ◽  
Xiaomeng Yang ◽  
Hongzhong Xiang ◽  
...  
Keyword(s):  
Small Businesses ◽  
Large Scale ◽  
Net Present Value ◽  
Economic Benefits ◽  
Zhejiang Province ◽  
Internal Rate Of Return ◽  
Present Value ◽  
Good Market ◽  
Forestry Industry

Significant quantities of bamboo waste are generated in Zhejiang province, China. Many small businesses in this area convert this waste to biochar for use as a cooking fuel (in residential barbecues). This case study was conducted to evaluate the potential economic benefits of building and operating an industrial-sized plant in this province, yielding 500 tonnes per year. The researchers developed a conceptual design for a hypothetical biochar plant and then calculated net present value (NPV), investment payback period (PBP), internal rate of return (IRR), and sensitivity analysis. Results show that the static investment PBP would be 2.58 years, the IRR would be 38.8%, and the NPV would be US$ 486,700. The IRR would be higher than the forestry industry benchmark (11%), indicating that a production line of bamboo-biochar with the stated yield not only could generate higher profits, but also could achieve a better return on investment. Thus, this study indicates that there are good market prospects for the bamboo-biochar industry in this region. The influence of sales prices on the IRR was more than that of operational costs, indicating that a large-scale plant should be designed to produce a high-quality bamboo-biochar. Supply chain issues such as transportation distances between locations where bamboo wastes are generated and the biochar plant should be considered in advance when siting new bamboo-biochar plants. The results from this research provide guidance to those considering development of bamboo-biochar plants in other parts of China.

scholarly journals What is the Value of an Existing Forest Stand?

EDIS ◽  
2019 ◽  
Vol 2019 (6) ◽  
pp. 3
Author(s):  
Andres Susaeta ◽  
Chris Demers
Keyword(s):  
Forest Resources ◽  
Forest Stand ◽  
Present Value ◽  
Expectation Value ◽  
Fact Sheet ◽  
Land Expectation Value ◽  
Main Indicator ◽  
Bare Land ◽  
Value Of Cash

Traditionally, the land expectation value (LEV) formula, the present value of perpetual cash inflows of timber revenues minus the present value of cash outflows of costs, has been employed as the main indicator of the value of a forest investment. However, when a forest stand is already established, the LEV approach is incomplete because it applies only to bare land. Thus, it is necessary to determine the value of a property with an existing forest stand. This 3-page fact sheet written by Andres Susaeta and Chris Demers and published by the UF/IFAS School of Forest Resources and Conservation provides the formula to determine the value of an already established forest stand at any stage of its development. This approach, known as the forest value formula, includes the value of the timber and the land. It can be used to compare the value of the stand when it is immediately harvested or when it is economically immature. http://edis.ifas.ufl.edu/fr423

scholarly journals Evaluating the Most Suitable Tree Species Using Land Expectation Value: A Case Study from Plantation in North of Iran

2019 ◽  
pp. 1-8
Author(s):  
Zohreh Mohammadi ◽  
Soleiman Mohammadi Limaei ◽  
Teymoor Rostami Shahraji
Keyword(s):  
Net Present Value ◽  
Timber Production ◽  
Timber Species ◽  
Annual Increment ◽  
Forest Road ◽  
Expectation Value ◽  
Bald Cypress ◽  
Land Expectation Value ◽  
Stumpage Price ◽  
North Of Iran

Plantation in north of Iran is rapidly increasing by local farmers and state but it is not clear which species is most suitable for perpetual timber production. Thus, this study is carried out to evaluate the most suitable timber species among ash (Fraxinus excelsior), elm (Alnus glutinosa), maple (Acer velutinum), oak (Quercus castanifolia), bald cypress (Taxodium distichumin) in north of Iran for evaluation of most suitability using Land Expectation Value (LEV). Data such as wood price at forest road side and variable harvesting cost was collected from secondary souce especially General Office of Natural Resources in Guilan province for a period of 20 years. Average annual increment of different species derived from previous researches. Consumer Price Index (CPI) was used for deflation of stumpage price. Regression analysis was used to predict the stumpage price of different species. Then, the mean price process was determined for different species. Faustmann's formula was used to determine the LEV or Net Present Value (NPV) for a perpetual timber production of different species.  The results showed that the LEV of ash, elm, maple, oak and bald cypress were 2623.883, 4653.042, 4319.9644, 2206.8788, 8064.667 (0.33 US dollar/ m3), respectively. The LEV of bald cypress was the highest, so it can be concluded that this species is the most suitable for timber production.

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