The Effect of Two Different Price Systems on the Value and Cross-cutting Patterns of Norway Spruce Logs

A computer program of a forward reaching algorithm of dynamic programming is presented for optimal log bucking. The application is implemented using an object-oriented programming approach. Sensitivity analyses were applied for evaluating the effects in terms of economic value and usable volume, and of altering the price system for saw wood. The data used consisted of 451 Norway spruce (Picea abies (L.) Karst.) stems collected from 13 forest sites located in three regions in Norway. Grade I and Grade II saw wood and pulpwood were used. The mean timber value increased approximately 1% when the new price system was introduced. The value obtained by introducing the new prices varied between the sites (0.1%-1.6%) as well as between regions (0.3%-1.6%). The analyses based on taper equations over-estimated the total value for all the alternatives. Finally, decreasing the width of stem sections and increasing the number of log length alternatives increased the total value of the sample trees but increased the computation time.     

Models for Assessing Timber Grade Distribution and Economic Value of Standing Birch Trees

In order to obtain a more precise prediction of the distribution of each timber grade or log grade with regard to the volume of birch (Betula pendula Roth., B. pubescens Ehrh.) in models for long-term planning, ordered probit models were developed. These models were developed by using data from three mixed birch and Norway spruce stands in Norway. The data consisted of 168 stems. In Norway, three ordinary birch saw log grades are commonly used, with pulpwood as a fourth grade. In this study, these four grades were applied in addition to waste timber, which was treated as a fifth grade. The developed models showed that the grade distribution of birch trees of mixed birch and spruce stands was highly correlated with tree height (p<0.01) and height to first visible dry branch (p=0.081). The statistical significance of both models was good (p<0.0001), as measured by log likelihood test statistics. Classifying the 168 stems by saw timber or pulpwood in butt log led to greatly improved estimates (p<0.01). The developed models would allow the incorporation of timber grade in stand simulators, enabling more precise predictions regarding the economic implications of alternative management strategies for birch trees.     

LIST OF MEMBERS OF THE S.A. INSTITUTE OF FORESTRY AS AT 1 APRIL 1976

ABSTRACT

Separate volume regression equations for pulpwood, sawtimber and over-mature Eucalyptus grandis are presented. An investigation of Schumacher and Hall's volume equation indicated that a better fit may be obtained by adding a constant to the dbh as predictor variable. The resultant equation is:

log V = ?4,2328 + 1,7154 log (D-2) + 1,1070 log H.     

Optimal Rotation Age of Larix kaempferi Pulpwood Plantation by Real Options Approach

The differentiation process including somatic embryogenesis in different Ginkgo explants in vitro culture were studied by cytological observation.The results are as follows:1) two complete cotyledons and a embryo bud were observed in mature embryos and several secretory acavitives appeared in maturation region of embryo buds,hypocotyls,cotyledons and radicles after culturing 20 days;two incomplete cotyledons and a embryo bud primordia were found in large cotyledon embryos.The proembryo of two cells,four cells, multi-cellular,and globular embroy were developed from the callus of the small cotyledon embryos.2) The differentiation of cotyledon explants started from epidermal cells,and gradually formed meristematic cell mass in the cortical cells,and eventually adventitious buds were observed.3) The adventitious roots of Ginkgo originated in the cells at the cross of vascular cambium and vascular rays. 4) The type of rooting belongs to induction type by root primordium.The formed adventitious roots were observed after 20 days.     

Influence of Log Characteristics on Drum Debarking of Pulpwood

Properties of 200 poorly debarked softwood logs were studied in order to examine how different log characteristics affect drum debarking of mixed pine (Pinus sylvestris L.) and spruce [Picea abies (L.) Karst] pulpwood during the summer. The definition of a poorly debarked log and the sampling criterion was that >10 dm² bark remained on the log surface. The average share of poorly debarked logs was 8% and the most frequent log type was breakage logs. The main species among the poorly debarked logs was spruce and the mean wood moisture content was considerably lower than for the pulpwood chips. Many logs were affected by root rot or were damaged by harvesting equipment, resulting in reduced moisture content and, consequently, in increased bark/wood shear strength. Bark from the poorly debarked logs contributed to approximately 68% of the bark content in the chips. By avoiding air-drying of pulpwood, or by sorting pulpwood prior to debarking, the bark content in chips might be substantially reduced, which would improve the purity of the pulp and decrease production costs.     

Modelling Birch Pulpwood Imports to Finland

Recent increases in pulpwood imports to Finland have raised an intense debate about their possible effects on the domestic wood markets. Since important institutional and structural changes in the market environment have taken place in the markets during the 1990s, it is important to take these into account in modelling imports. Our results consider three different time periods between 1986 and 1998, and indicate that market mechanisms in Finnish birch pulpwood imports have improved substantially in the latter part of the 1990s. Imports are found to be elastic with respect to changes in pulpwood import price, domestic pulpwood price and pulp export price. Furthermore, imports of birch pulpwood seem to have complemented the domestic market rather than to have been a substitute for it.     

Determinants of Swedish pulpwood imports

Pulpwood is imported to Sweden as a result of price discrimination and the monopsonistic features of the domestic pulpwood market. To investigate the determinants of Swedish pulpwood imports, econometric models were developed for the three imported assortments: pine, spruce, and non‐coniferous pulpwood. All prices used in the models were relative to the price of pulpwood imports. The study shows that the relative price of pulpwood (e.g. price of standing timber for sale/price of pulpwood imports) is not a significant determinant of pulpwood imports; it has the wrong sign for spruce pulpwood. This unexpected finding may have been a result of the impossibility of categorizing the price for standing timber according to pulpwood assortments. The relative export price of pulp, however, was found to be a significant determinant of spruce pulpwood imports, although not of pine and non‐coniferous pulpwood. An important determinant is the relative prices of inputs other than pulpwood in pulp production. The study also shows that pulpwood imports respond to price signals with a 1 yr lag, indicating inertia in trade.     

The consequences for the forest sector of nuclear power discontinuation in Sweden

Electricity prices in Sweden will most probably double, or more, during the next 10 to 15 years as a result of the decision to discontinue nuclear power production. This will substantially change the comparative advantage of all forest‐based product industries, some to the worse, some to the better. Roundwood prices and fellings will be affected and possibly the competitive position of wood‐based energy production. This paper estimates various types of effects with a long run pulpwood market model. The effects on electricity intensive production (CTMP, newsprint, etc.) may be drastic. However, the fall in total industrial consumption and price of pulpwood will be limited. The reduction in price is not sufficient to make pulpwood economically attractive as fuel. Own‐price elasticities of electricity demand are greater than reported elsewhere.     

Price dynamics in the Russian–Finnish roundwood trade

Abstract

This study examines price dynamics in roundwood exports from Russia to Finland, the largest international roundwood trade flow within Europe. The analysis covers six main timber assortments; sawlog and pulpwood dimensions of pine, spruce and birch. The study period, starting from the devaluation of the rouble in August 1998, was characterized by a drastic increase in the volumes of Russian roundwood imported into Finland, and a coinciding structural change in the timber assortment distribution of the Finnish roundwood imports. A basic hypothesis of economic theory, the law of one price, was tested by using quarterly time series and methods of cointegration analysis. According to the cointegration tests, the prices of Finnish and Russian spruce sawlogs have moved closely together. Furthermore, the changes in the prices of spruce sawlogs in the Finnish roundwood market are reflected in the Russian prices and not vice versa. Regarding other timber assortments, price co-movement and consequent market integration was not detected.     

Classification of Picea abies Pulpwood According to Wood and Stand Properties

Different classification systems for Norway spruce (Picea abies (L.) Karst.) pulpwood were compared. The classification systems were applied on truckloads or single logs in southern Sweden. Truckload classification according to mean annual growth ring width gave better separation of the wood properties basic density, juvenile wood and dry matter content, than classification according to harvest type (first thinning, later thinning or final felling). The assortments did not have significantly different wood brightness. Sorting at log level according to diameter, mean annual growth ring width or number of annual growth rings, which could be done at harvesting, did not drastically improve differentiation of the mean values of the wood properties or reduce variance compared to truckload classification. The variation in wood properties within assortments remained large owing to the large variation in wood properties between and within logs. Substantial reduction in dry matter variation could be achieved by truckload classification during the summer.     

Stochastic simulation of forest fuel sourcing models under risk

Abstract

Climate change effects such as storms and droughts are leading to increased risk of forest damage in central Europe. The aim of this paper was to evaluate forest fuel sourcing models including climate change-induced risks on forest fuel supply. Stochastic risk events, such as storms and bark beetle infestations, were modelled by means of a Monte Carlo simulation, and the economic performance was evaluated for two fuel-sourcing models supplying a single combined heat and power plant (CHP). The first sourcing model depicted a common sourcing model for Austrian CHPs, where only forest chips provided by long- and short-term suppliers were stored. The second sourcing model additionally enabled the storage of salvaged pulpwood to supply forest fuel from the plant's own inventory during shortage periods. Simulation results showed that storing salvage pulpwood as feedstock considerably reduced supply chain risks and resulted in lower procurement costs (1–3% less than normal delivered cost without storing salvaged pulpwood).     

Veränderungen der Sortenstruktur

Zusammenfassung Die von der Holzaufkommensprognose für Bayern für die Stichjahre der Expertensch?tzungen bis zum Jahr 2005 prognostizierten Nutzungsmengen werden mit Hilfe eines Sortierungsmodells nach Dimensionen aufgeteilt in starkes und schwaches Stammholz sowie Industrieholz. Gegenüber der Referenzvariante, einer theoretischen Entwicklung des Einschlages ohne die Walderkrankung, haben die B?ume der Zwangsnutzungen anfangs deutlich st?rkere Dimensionen als die normale Nutzung der unterstellten schadensfreien Entwicklung. Mit zunehmendem Schadgrad und l?ngerem Anhalten der Walderkrankung vermindert sich das durchschnittliche Volumen der geernteten B?ume. Es sind jedoch bei diesen Szenarien zur Walderkrankung keine extremen ?nderungen der Sortenstruktur zu erwarten, die Verschiebungen zwischen den Sortengruppen dürften daher auch nicht zu gro?en Problemen bei den Holzverwendern führen.

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Changes in log dimensions and the share of industrial roundwood

Summary For the scenario variants, estimated volumes of the cuttings are graded into log classes and pulpwood using a simulation model. Compared with the adjusted timber supply prognosis as a reference variant for an undisturbed development, it is obvious that the trees of the forced cuttings have a larger average breast-height diameter. Due to the reductions in increment and the predominance of damages in the older stands the average volume of the harvested trees decreases in later periods. Serious problems caused by larger diameters of trees and logs in the forced cuttings are not expected because in most processes timber with larger diameters could replace smaller logs and pulpwood.

     

The Effect of Bark Condition,Delivery Time and Climate-adapted Wet Storage on the Moisture Content of Picea abies (L.) Karst. Pulpwood

The wet-base moisture content (MC) in outer sapwood of Norway spruce (Picea abies (L.) Karst.) pulpwood in different wood management programmes from the forest to the mill was studied from the point of view of three objectives: (1) the importance of rapid raw material delivery, (2) the effect of bark condition as a result of harvesting during the late dormant season and the growing season, and (3) the possibilities for retaining the pulpwood MC using climate-adapted wet storage. The reduction in MC after felling was significant in the pulpwood stored without wet storage. When not wet-stored, pulpwood with a high degree of bark damage dried out more rapidly than wood with a low degree of bark loss. In pulpwood, wet-stored in accordance with climate-adaptation, the MC remained or increased during storage. The shorter the drying time before wet storage, i.e., faster delivery to the mill, the more significant the increase in MC. The increase in MC during wet storage was more significant in pulpwood with a low degree of bark damage. Climate-adapted wet storage reduced the variation of the MC. When conducted with fresh pulpwood, i.e., drying time shorter than 4 weeks (low bark loss) or 2 weeks (high bark loss), a more homogeneous MC distribution was gained.     

Small-Scale Timber Harvesting: Mule Logging in Hyrcanian Forest

Animal-powered logging is a labour-intensive operation. Mule logging is still performed in the Hyrcanian forest ecoregion in Iran as a small-scale harvesting method. Mule logging in Namkhaneh district of Kheyrud Forest within this ecoregion was studied to develop hauling regression models and estimate haulage costs. A continuous time study was conducted of hauling of sawn-lumber, pulpwood and fuelwood, to assess mule logging productivity and cost for sawn-lumber and pulpwood as well as fuelwood hauling. Hauling distance was found to be the most important cost factor in wood extraction by mule. The hourly production rates of hauling with mule were 0.84, 0.52 and 0.42 m³ for sawn-lumber, pulpwood and fuelwood, respectively. The cost of the mule hauling system USD 13 per productive mule hours. Hourly costs of mule hauling of sawn-lumber, pulpwood and fuelwood logging were 15.5, 25, and 30.6 USD/m³. Increasing hauling distances caused a linear increase in haulage cost. There appears to be an opportunity to reduce cost of log production by increasing scheduled work hours, wider utilization of mules and reducing labour cost.     

Product diversification in South Africa’s commercial timber plantations: a way to mitigate investment risk

We used the portfolio method to examine how a forest company can lower investment risk by producing a mix of timber products. We derived optimum combinations of pine (Pinus patula) saw timber production and eucalypt (Eucalyptus grandis) pulpwood production at landscape level. Our results indicate that producing a product mix rather than a single product improves aggregated financial returns and lowers investment risk over multiple rotation periods. The optimum mixture depended on past timber price correlations for pulpwood and sawn timber in South Africa between 1980 and 2011. This ideal mixture is comprised of areal ratios of about 45% saw timber and 55% pulpwood. Our example shows how economic risk of a forest investment can be reduced by creating a portfolio of a number of products. The risk that an investor has to accept for each monetary unit that is expected in return can be reduced by over 40% when comparing the risk–return combinations of a pure pine saw-timber stand with that of a portfolio of forest products. The risk associated with the production can be reduced by 20% when growing a portfolio of products rather than eucalypt pulpwood only.     

Difference in cutting age for highest profit by methods for calculating CO<Subscript>2</Subscript> emission trading and the price of CO<Subscript>2</Subscript>

 The amounts of CO₂ that are absorbed and emitted by forest in a model stand area were determined using two calculation methods, namely the flow approach and the stock approach for emission trading, to understand the relationships between the cutting age for the highest profit rate (CAHPR; optimum tree ages to be cut so as to maximize the profit) and (1) the prices of CO₂ and (2) the balance between CO₂ emission and absorption. The resultant CAHPR differed between these two CO₂ accounting methods, which give different tree ages for maximum log volume yield. A rise in CO₂ price caused the CAHPR to approach the tree age of maximum log volume in the flow approach method, and to deviate from the tree age of maximum log volume in the stock approach method. Even at the same CO₂ price, the CAHPR differed between the CO₂ accounting methods. At low CO₂ prices, the CAHPR did not affect situations where the difference of average profit is large by cutting age. On the other hand, the CAHPR was greatly affected at low CO₂ prices when the mean log volume growth changed with tree age. These trends were found to be universal. Received: September 18, 2001 / Accepted: October 25, 2002 Acknowledgments This study is one of the fifth science study subsidy projects of the Japan Forest Technology Association. Correspondence to:K. Sakata     

Modelling the Number of Rings in Individual Logs of Norway Spruce

In timber production, there is a need to select the right log for a given end - product. To achieve this objective, individual tree characteristics (total height, diameter at breast height and age) and external measurements made on the log shape were combined. In this study, three possible methods are analyzed to assess the number of annual rings for a given Picea abies (L.) Karst. log using modelling. The first method consists of finding a link between the number of rings and the size, the taper and the location of the log in the tree. The second one is based on the log location in the tree and the use of an height - age growth model. The third involves the whorl location inside the log and the use of an individual height - age growth model. The three methods are compared on the basis of the amount of data required by each and error analysis.     

Price integration for domestic and imported sawlogs and pulpwood in Finland: an update

This paper provides an analysis on the integration of prices for imported coniferous pulpwood and sawlogs, and respective domestic stumpage prices in the Finnish wood market. Eight real price series were investigated during 2002–2014 using monthly observations. The bounds testing approach by Pesaran et al. [(2001) Bounds testing approaches to the analysis of level relationships. J Appl Econom. 16: 289–326. doi:10.1002/jae.616], indicates there are long-run relationships between prices of domestic and imported wood. For more detailed information, the vector error correction model (VECM) approach was used. Estimation of a system with all eight prices with interpretable results did not succeed; therefore, we estimated models for prices of sawlogs and for pulpwood separately. For sawlogs, two co-integrating vectors, one for pine and one for spruce, were found. For pulpwood prices, one co-integrating vector was identified. The estimated VECMs confirm the results of bounds testing approach, suggesting that causation in the Finnish wood market runs from domestic prices to prices of imported wood. We conclude that prices of domestic and imported coniferous logs and pulpwood are closely connected. The question of full integration remains open, as border prices and stumpage prices by definition differ, at least, by logging and transportation costs.     

Structural changes in sawlog and pulpwood markets in Finland

This paper presents a short‐term econometric model for the sawlog and pulpwood markets in Finland. More specifically, the effects of structural changes in the market on the success of short‐term market modelling are investigated. Wood prices and quantities traded are stationary. Therefore, valid statistical inference using the levels of these variables is possible. Pulpwood prices were found to be directly proportional to sawlog prices during the study period, and the cross‐price effects were not statistically significant. The results indicated that the price sensitivity of wood supply in Finland increased during the 1980s and early 1990s. Nationwide collective price agreements were found to have increased the level of pulpwood supply and demand from private forests, but to have had no effect on either supply of or demand for sawlogs. Due to a structural change in the 1970s, the models estimated for the whole period cannot be used for short‐term forecasting in the 1990s. Higher‐than‐annual frequency data should be used in developing accurate short‐term forecasting models.