Increasing Mass Timber Consumption in the U.S. and Sustainable Timber Supply

Mass timber products are growing in popularity as a substitute for steel and concrete, reducing embodied carbon in the built environment. This trend has raised questions about the sustainability of the U.S. timber supply. Our research addresses concerns that rising demand for mass timber products may result in unsustainable levels of harvesting in coniferous forests in the United States. Using U.S. Department of Agriculture U.S. Forest Service Forest Inventory and Analysis (FIA) data, incremental U.S. softwood (coniferous) timber harvests were projected to supply a high-volume estimate of mass timber and dimensional lumber consumption in 2035. Growth in reserve forests and riparian zones was excluded, and low confidence intervals were used for timber growth estimates, compared with high confidence intervals for harvest and consumption estimates. Results were considered for the U.S. in total and by three geographic regions (North, South, and West). In total, forest inventory growth in America exceeds timber harvests including incremental mass timber volumes. Even the most optimistic projections of mass timber growth will not exceed the lowest expected annual increases in the nation’s harvestable coniferous timber inventory.

Estimated Impacts of Emerald Ash Borer on Ash Timber Supply in Texas, USA

We estimated annual timber growth, removals, and mortalities under various scenarios of the spread of emerald ash borer (Agrilus planipennis Fairmaire; EAB) within Texas. Future annual ash EAB-induced mortalities were simulated to follow either a normal or beta distribution over 25, 50, or 75 years, with five percent of the original inventory remaining at the conclusion of each projection. Discounted present values of future ash growth, harvests, mortalities, salvage, and beginning and ending annual inventories were calculated, and economic impacts to timber receipts were determined from average real prices. The present net effects of timber product output, mortalities, and salvage resulted in benefits ranging from lows of (delivered/stumpage) $37.6/$12.8 million over 25 years when assuming a normal distribution to highs of $247.8/$97.2 million over 75 years under a beta distribution. Salvage intensity exceeded mortality accumulation by a factor of at least 2.00. Regardless of length chosen, mortality that skewed toward later years led to lower discounted volumes and less value lost to EAB. Results were sensitive to discount rate selection (constant, increasing, distributional) with the constant and increasing rates having the most similar results. Longer time horizons led to far smaller losses of overall economic returns allowing more typical harvest management despite EAB.

Comparatively Study Renting and Purchasing Carbon Subsidies Schemes on Portfolio and Stochastic Control Theory

Applying the portfolio and stochastic control theory, the paper comparatively considers tow carbon subsidies schemes: Renting and Purchasing, and focuses on the rental scheme to present a stochastic control model and obtain an analytical optimal dynamic strategy about harvesting quantity in conditions of stochastic commodity price and timber growth. Through contrasts, the conclusion shows that government will pay less under the rental scheme than under the purchasing scheme for the same negative effect on harvesting quantity.

Risk Management Behavior of a Forest Owner to Address Growth Risk

We analyze risk management behavior (financial savings versus physical savings) of a private forest owner who values amenities in relation to uncertainty about timber growth. In a two-period model, we study the properties of optimal current and future harvesting and risk management decisions. We show that the forest owner chooses the tool with the highest rate of return unless both risk management instruments are perfect substitutes. We prove that future harvesting is greater under physical savings than under financial savings. Comparative static results on amenity preferences, incomes, forest stocks, timber prices, and opportunity costs are investigated.

Typologisierung des forstwirtschaftlichen Testbetriebsnetzes der Schweiz

Typology of the Swiss Forestry Holding Network The requirements and policies that affect the results of individual forest enterprises are numerous. To develop functioning management and advisory mechanisms, these individual circumstances should be taken into consideration. However, compliance with all the influencing factors is not feasible in practice, wherefore a reduction in the existing complexity is necessary. Multivariate statistical methods allow to use a variety of indicators as a basis for the formation of different types of forest enterprises. The goal to consider the individual operating conditions as completely as possible can be achieved with a multivariate typology. For the Swiss Forestry Holding Network (HDN), the question arises as to whether the results of such a typology can also be reproduced by the currently used biogeographic classification of forest zones. Sixty-six variables with information about structural properties and the business results of 208 Swiss holdings from the years 2008 to 2010 formed the basis of the study data. These variables were reduced to 19 key variables. With the help of principal component and cluster analyses the holdings were divided into four clusters based on these key variables. They differ from each other significantly in most of the key variables. The results of this multivariate typology can be mapped in part by the forest zones of Switzerland. It should be noted that the variable “forest zone” also acts as a multivariate criterion, reflecting the physical and structural requirements of the enterprises. Combined with certain additional information (e.g. timber growth), the results of the multivariate analysis can be even better understood.

A Portfolio Approach for the Forest Asset Dynamic Management under Stochastic Timber Price and Growth

Considering the valuation of forest stands based on revenue from wood sales, concession policy (such as carbon subsidies) and associated costs, the paper focuses on the stochastic control model to study the forest asset dynamic management. The key contribution is to find the optimal dynamic strategy about harvesting quantity in the continual and multiple periods in conditions of stochastic commodity price and timber growth by using portfolio approach. Finally, an analytical optimal strategy is obtained to analyze the quantification relations through which some important conclusions about the optimal forest management can be drawn.