Predicting timber harvests from private forests—a utility maximisation approach

Forest owners’ values and the ownership structure of forest are changing continuously. One probable consequence of the current trends in Finland is that the significance of forest-related income will decrease, which may have a significant impact on the round wood supply. This study developed and demonstrated a new method, which allows policy makers to make forecasts on the future timber supply. The method is based on the assumed temporal changes in the distributions of the importance of different forest management goals. The distributions are converted into utility functions, generated separately for each forest holding. The utility functions are maximised, using heuristics, to obtain the optimal forest management plans for the holdings. The regional cutting budget is calculated by summing the removals of the optimal treatment schedules of stands over the whole area. The method was demonstrated by assuming four different scenarios for the forest management goals, in which the importance of net income from realised cuttings decreased by 0%, 25%, 50% or 100% in 60 years. The decrease was compensated for by an increased importance of the other goals, namely economic security, recreation, and nature values. The calculations were made with three different methods. Methods 1 and 2 derived the optimal plans directly for the whole 60-year period while Method 3 developed three consecutive 20-year plans. Method 2 assumed that the holding is sold or inherited once in 20 years with an abrupt change in the management goals. In Methods 1 and 3 the goals changed only gradually. The results were logical, indicating that the more the importance of net income decreases the lower the future timber supply will be.