Connecting a process-based forest growth model to stand-level economic optimization

This study extends the economic literature on forest stand management by applying a process-based, rather than empirical, stand growth model. The economics of timber production is investigated using a distance-independent, individual tree process model specified for pure Scots pine (Pinus sylvestris L.) stands. Stem taper and crown morphology information are used for bucking the harvested trees into several roundwood categories according to quality and dimension requirements applied in the Finnish timber markets. Explicit inclusion of causality and timber quality in stand-level economic optimization generates a set of new results. Economic optimization decreases biomass production but increases roundwood production, compared with undisturbed stands. Optimal rotation length is insensitive to changes in the rate of interest beyond 4% owing to nonmonotonic value growth. Better quality attributes and higher productivity in resource use are partial reasons for favoring lower canopy trees in optimal thinnings. The first thinnings are light, irrespective of the rate of interest, because of their favorable feedback effects on the quality of residual trees. Production of the highest-grade roundwood is rational only at rates of interest lower than those prevailing in the capital markets. An example of two optima representing distinct timber management strategies is shown.