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Profitability of measures to increase forest growth

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  • Simonsen, Rune
  • Rosvall, Ola
  • Gong, Peichen
  • Wibe, Sören

Abstract

The profitability of seven silvicultural measures to increase forest growth was examined for the forest company Holmen Skog in northern Sweden. The report rests on data from a recent Production Assessment where a wide range of measures to increase short and long term forest growth for the company were identified. The measures examined are the use of genetically improved materials, fertilisation, maintenance of ditches, improved seedling quality, treatment against beetles (Hylobius abietis L.) and introduction of lodgepole pine (Pinus contorta Dougl. ex Loud. var. latifolia Engelm). The majority of the silvicultural measures proved profitable. Changing species from Scots pine (Pinus sylvestris L.) to lodgepole pine and the use of genetically improved regeneration materials were found to be very profitable due to low investment costs and considerable increase of forest growth. Fertilisation proved highly profitable but the measure has a drawback of being expensive. However, fertilisation has an advantage of an earlier effect on timber harvest due to a short investment period. Linear programming was used to determine the optimal mix of measures with varying budgets. At present the company's silvicultural budget is around 100 million SEK annually. Increasing the silvicultural budget by 5 million SEK would result in an increase in net present value of almost 24.2 million SEK. This represents 48% of the increase of net present value if all the profitable measures are carried out.

Suggested Citation

  • Simonsen, Rune & Rosvall, Ola & Gong, Peichen & Wibe, Sören, 2010. "Profitability of measures to increase forest growth," Forest Policy and Economics, Elsevier, vol. 12(6), pages 473-482, July.
    • Handle: RePEc:eee:forpol:v:12:y:2010:i:6:p:473-482
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    References listed on IDEAS

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    1. Solberg, Birger & Moiseyev, Alexander & Kallio, A. Maarit I., 2003. "Economic impacts of accelerating forest growth in Europe," Forest Policy and Economics, Elsevier, vol. 5(2), pages 157-171, July.
    2. Eriksson, Ljusk Ola & Sallnas, Ola & Stahl, Goran, 2007. "Forest certification and Swedish wood supply," Forest Policy and Economics, Elsevier, vol. 9(5), pages 452-463, January.
    3. Holgén, Per & Bostedt, Göran, 2004. "Should planting of broad-leaved species be encouraged at the expense of spruce? An economic approach to a current southern Swedish forestry issue," Journal of Forest Economics, Elsevier, vol. 10(3), pages 123-134, November.
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    1. Brännlund Runar & Carlén Ola & Lundgren Tommy & Marklund Per-Olov, 2012. "The Costs and Benefits of Intensive Forest Management," Journal of Benefit-Cost Analysis, De Gruyter, vol. 3(4), pages 1-25, December.
    2. Honkaniemi, Juha & Ahtikoski, Anssi & Piri, Tuula, 2019. "Financial incentives to perform stump treatment against Heterobasidion root rot in Norway spruce dominated forests, the case of Finland," Forest Policy and Economics, Elsevier, vol. 105(C), pages 1-9.

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