Space-Time Modeling of Timber Prices

A space-time econometric model was developed for pine sawtimber timber prices of 21 geographically contiguous regions in the southern United States. The correlations between prices in neighboring regions helped predict future prices. The impulse response analysis showed that although southern pine sawtimber markets were not globally integrated, local supply and demand shocks did transmit partially to immediate neighboring regions, and could also have weaker effects in more distant regions.impulse response, market integration, space-time model, spatial correlation, Demand and Price Analysis,

INTERNATIONAL DIFFUSION OF TECHNOLOGICAL CHANGE WITHIN THE WOOD PRODUCTS INDUSTRY: THE CASE OF PARTICLEBOARD

Research and Development/Tech Change/Emerging Technologies,

Modeling some long-term implications of CO2 fertilization for global forests and forest industries

Background This paper explored the long-term, ceteris-paribus effects of potential CO 2 fertilization on the global forest sector. Based on the findings of Norby et al. (PNAS 2005, 102(50)) about forest response to elevated [CO 2 ]. Methods Forest productivity was increased in the Global Forest Products Model (GFPM) in proportion to the rising [CO 2 ] projected in the IPCC scenario A1B, A2, and B2. Projections of the forest area and forest stock and of the production, consumption, prices, and trade of products ranging from fuelwood to paper and paperboard were obtained with the GFPM for each scenario, with and without CO 2 fertilization beginning in 2011 and up to 2065. Results CO2 fertilization increased wood supply, leading to lower wood prices which in turn induced modest lower prices of end products and higher global consumption. However, production and value added in industries decreased in some regions due to the relative competitive advantages and to the varying regional effects of CO 2 fertilization. Conclusion The main effect of CO 2 fertilization was to raise the level of the world forest stock in 2065 by 9 to 10 % for scenarios A2 and B2 and by 20 % for scenario A1B. The rise in forest stock induced by fertilization was in part counteracted by its stimulation of the wood supply which resulted in lower wood prices and increased harvests

QUALITY ADJUSTED PRICE INDICES FOR DOUGLAS-FIR TIMBER

The purpose of this paper is to determine if there have been systematic changes in the characteristics of Douglas-fir stumpage sold on National Forests in the Pacific Northwest that would significantly bias the price of stumpage. Four hedonic methods were used to develop indices of pure price change holding stumpage characteristics constant. None indicated a significant trend in quality over the period 1968 to 1978. Quality differences, however, appeared to play a role in the year-to-year price changes. The advantage and inconveniences of each indexing method and their use for various purposes are discussed.Demand and Price Analysis,

Effects of the Free Trade Area of the Americas on Forest Resources

The effects of the Free Trade Area of the Americas (FTAA) agreement on the forest sectors and resources of member countries are investigated. A model of wood supply within the spatial partial-equilibrium Global Forest Products Model is developed to link international trade and deforestation. The direct effects of tariff changes and the indirect effects of income changes induced by trade liberalization are considered. The FTAA has a small positive impact on the region's forest resources. Higher harvests of industrial roundwood in most countries are offset by increased afforestation due to the income effect of trade liberalization (captured by the environmental Kuznets curve).trade liberalization, international trade, forest resources, forest sector trade model, International Relations/Trade, Resource /Energy Economics and Policy,

DETERMINANTS OF NON-TIMBER VALUE IN NORTHERN HARDWOODS: A FRAMEWORK FOR FOREST RESOURCE ACCOUNTING

We propose a revealed-preference based definition of non-timber values and apply it to uneven-aged northern hardwoods in Wisconsin. Non-timber values so defined are found to be sizeable. Hedonic regressions reveal theoretically consistent signs and plausible magnitudes of determinants. Regional forest policy and natural resource accounting can both apply this concept.Environmental Economics and Policy,

Forecasts of Wastepaper Supply and Consumption In The United States To 1985

Recycling of wastepaper is a partial solution to the solid waste management problem and a source of fibrous material in the production of paper and board products. Unlike virgin fiber, wastepaper is the result of past paper and board consumption. To consider these important facts and others affecting wastepaper supply and consumption, a model of the paper and board industry inclusive of wastepaper recycling was constructed. The results of application of this model showed that wastepaper supply and consumption can vary widely depending on the future recovery rates and utilization levels of wastepaper by the paper industry. By assuming the most optimistic wastepaper recovery and utilization increases by 1985, a domestic wastepaper supply shortfall is forecasted. However, the most likely future wastepaper utilization scenario indicates a surplus of wastepaper by 1985 given average recovery rates. The model can be used to consider a broad range of wastepaper recovery and utilization situations and alternative economic growth rates

Valuing the Recreational Benefits From the Creation of Nature Reserves in Irish Forests

Data from a large-scale contingent valuation study are used to investigate the effects of forest attributes on willingness to pay for forest recreation in Ireland. In particular, the presence of a nature reserve in the forest is found to significantly increase the visitors' willingness to pay. A random utility model is used to estimate the welfare change associated with the creation of nature reserves in all the Irish forests currently without one. The yearly impact on visitors' economic welfare of new nature reserves approaches half a million pounds per annum, exclusive of non recreational values.Non-market valuation, Contingent valuation, Forest attributes analysis, Nature reserves.

LONG-TERM FORECASTING OF INTERNATIONAL FOREST PRODUCT MARKETS: THE GFPM MODEL AND IMPLICATIONS FOR EUROPE

The Global Forest Products Model (GFPM) was developed to upgrade the FAO methodology for forest products outlook projections. Its purpose is to analyze and project the consumption, production, trade, and prices of forest products. The system deals with 180 individual countries, three classes of roundwood, sawnwood, three kinds of panels, three of pulp, waste paper, and three types of paper and paperboard. The system is built on market equilibrium theory, with imperfect foresight. The short-term equilibrium is modeled by price-endogenous linear programming determining production, consumption, trade, and market-clearing prices in any given year, subject to short-term capacities of production. Year to year changes are represented by equations predicting shifts in demand due to GDP growth, capacity expansion as a function of profitability, and technical change. The forecasts are conditional on exogenous estimates of timber availability in each country. Inertia constraints limit the short-term adjustment of trade in response to market forces. Results of applications of the model to forecast the situation in European countries until 2010 are described.International Relations/Trade,

Econometric Model of Price Formation in the United States Paper and Paperboard Industry

A model of price determination was proposed for the United States paper and paperboard industry. It assumed a generalized Cobb-Douglas production function, mark-up pricing, and cost minimization. The model was estimated for five commodity groups, over the period January 1967 to June 1979. The resulting equations accurately represented price behavior during the sample period. Coefficients had the expected sign and plausible magnitudes, except for the total paper and paperboard aggregate. Capital costs appeared to have a dominant importance in the setting of prices. Product prices did not appear to be related to capacity utilization rates, nor to the level of national production. Technological changes, other than those that were labor-saving, did not have a significant effect on paper and paperboard prices during the sample period. Derived demand equations for capital, labor, energy, pulp, and wastepaper were obtained