Profitability of alternative management regimes in Scots pine stands on drained peatlands

In drained, forested peatlands, ditch network maintenance (DNM) is often considered necessary for tree growth, but it also constitutes additional management costs. Commercial thinnings, in turn, in addition to their silvicultural benefits, are generally applied to enhance the financial performance of stand management but results from peatland stands are scarce. In this study, our aim was to find financially feasible management practices for Scots pine-dominated stands on drained peatland sites in Finland. Using mainly inventory data sets, we compiled altogether 29 typical model-stands for four climatic areas, four site types, and two stand conditions according to need for silvicultural care. We used MOTTI stand simulator to predict the development of the model-stands according to different management regimes consisting of various combinations of 0–2 DNM and 0–2 thinnings with different timings and thinning intensities. We then calculated and compared the financial feasibility of the regimes using net present value (NPV; discount rate 3%) analysis. The separate effect of DNM on the profitability was marginal, but the positive effect of thinnings was clear. The harvesting removals varied within a wide range, depending on the timing and intensity of thinnings, but on average, the NPV doubled due to the thinnings. In the stands of initially good silvicultural condition, regimes including only one thinning and a DNM operation generally displayed a good financial result. In the stands of initially poor silvicultural condition due to neglected early care, regimes with two thinnings produced the best NPV regardless of the often low-yielding first thinning.     

Scots pine stand establishment with special emphasis on uncertainty and cost-effectiveness,the case of northern Finland

The effect of uncertainty on the cost-effectiveness of alternative chains of stand establishment in northern Finland was examined. The data were from a reforestation study of Scots pine (Pinus sylvestris L.) consisting of 288 sample plots, which were measured with respect to regeneration success. The study design included four site-preparation methods (patch scarification, ploughing, prescribed burning and disk trenching) combined with three reforestation methods (sowing, planting with containerized seedlings and planting with bare-rooted transplants). Initial reforestation density was 2,500 spots or seedlings per hectare, and the regeneration success was modeled as probability with two thresholds, namely 500 and 1,100 saplings. On formerly spruce-dominated as well as pine-dominated sites the most cost-effective chain was ploughing and planting with containerized seedlings, when threshold was 1,100 saplings per hectare. However, with threshold of 500 saplings the best performer was ploughing and direct sowing on both sites.     

Financial performance of using genetically improved regeneration material of Scots pine (<Emphasis Type="Italic">Pinus sylvestris</Emphasis> L.) in Finland

The financial viability of using improved seed material of Scots pine was assessed in Finnish conditions. Based on a few dozen field trials, a range of genetic gains for height growth was incorporated into a stand simulator. Technically genetic gain was modelled into individual growth models by applying the Chapman-Richards type function and using genetic gain estimates as asymptotic scaling parameters. Stand projections, including the effect of genetic gain, were further converted into monetary terms by calculating bare land values, i.e. BLVs according to the Faustman rotation model. Following this, the financial attractiveness of using improved seed material from Scots pine was determined by comparing the BLVs between stands with and without genetic gain. The study focused on the private forest owner’s point of view, reflecting the primary demand conditions for improved seed material. Comparisons between BLVs indicated that using improved seed material of Scots pine would be financially viable for private forest owners in most parts of Finland, the discount rate being 3%. The main results were robust, with pertinent changes in silvicultural costs and stumpage prices. This study demonstrates the need for financial analysis in decision-making in the context of regeneration material.     

Cost-benefit analysis of using orchard or stand seed in Scots pine sowing,the case of northern Finland

A cost-benefit analysis of orchard seed versus seed from existing natural stands is presented for the scenario of direct sowing of Scots pine (Pinus sylvestris L.). The differential benefits of orchard seed are seed quality and improved yield due to genetic gain. These benefits are expected to further reduce the total cost of orchard seed. Seedlings from seed orchard seed had 11% better survival rate (p < .001, the best clone over 17%, p < .010) than seedlings from local stand seed. This was observed in a case study of 15 young seeding trials located in Central and North Finland. Expected yield improvements for stands established with orchard seed were obtained from local progeny test results, and they were further simulated on tree growth using the MELA forest simulation program. The cost-benefit analysis showed that, with a 7% yield improvement and a 15% better seed quality, the net cost of orchard seed was less than that of stand seed (discount rate 3%).     

Genetically improved reforestation stock provides simultaneous benefits for growers and a sawmill,a case study in Finland

Recent research has demonstrated benefits of genetically improved seed material (from seed orchards) for growers. In this study, we analyzed whether the profits of genetically faster growing material are also realized as simultaneous economic benefits for a sawmill. We compared three types of improved Scots pine (Pinus sylvestris L.) seedlots to unimproved seedlots on three climatically different sites using stand-simulation software MOTTI. Genetic gains in early-rotation growth traits were incorporated in the growth models as genetic multipliers. Bare land values of the simulated stands were maximized using stand-level optimization. Consequently, removals of each thinning and final harvest were used to estimate the total value of sawing yield. This was subsequently maximized by optimizing the sawing procedure of the logs assuming identical timber quality between improved and unimproved seedlots. The results indicate that simultaneous financial incentives from tree breeding are achievable for both agents (growers and a sawmill). In general, the financial potential increases with the growth potential of the regeneration material, although the form of the relationship is not linear in all cases.     

Rotation-end financial performance of vegetation control on Eucalyptus smithii in South Africa

Control of competing vegetation during eucalypt regeneration is important but the cost-benefit of varying levels of control is not well understood. A trial was initiated to quantify the impact of five vegetation control treatments on Eucalyptus smithii R.T.Baker. to determine the potential loss in growth and differential costs against which this growth loss could be linked. Five treatments were developed to suit the predicted vegetation load at the site and varied according to weeding intensity (high, moderate and low weeding) or area around the tree that was weeded (no vegetation control, a 2 m row weeding and complete vegetation control). The vegetation control treatments were imposed at planting and maintained until canopy closure (16.4 months). Tree growth was monitored throughout the rotation and this, together with the cost of the various establishment and weeding operations, were used to make treatment comparisons. Weed growth was rapid following planting, with competition-induced divergence in tree growth occurring from 52 d. Rotation-end volume for the Weedfree check (414 m³ ha^?1) and Row weeding treatment (394 m³ ha^?1) were significantly different from the Weedy check (319 m³ ha^?1), with the Moderate (374 m³ ha^?1) and Low (371 m³ ha^?1) weeding intensity treatments intermediate but not significantly different from each other, nor from the other treatments. The financial performance (expressed as bare land value [BLV] with 6% discounting) of the Weedfree check outperformed the other treatments and was 37% higher than the Weedy check. The BLVs of the Moderate and Low weeding intensity treatments were similar to each other, indicating that these treatments were both feasible in terms of financial performance. However, the 2 m Row weeding had c. 10% higher BLV than the Moderate and Low weeding intensity treatments, and could be considered as a viable alternative to the Weedfree check. Sensitivity analysis conducted on the data in terms of local or exogenous risks indicated that between the treatments, differences in response to either local or global market risks were minor. Thus, small changes in cost and price levels, or larger changes in applicable discount rate, would not alter the ranking of the vegetation control treatments, with the Weedfree check (High weeding intensity) being the best in terms of financial performance, and the Weedy check the worst.