Impacts of climate change on forest product markets: Implications for North American producers

Abstract

This paper examines potential climate change impacts in North American timber markets. The results indicate that climate change could increase productivity in forests in North America, increase productivity in forests globally, and reduce timber prices. North American consumers generally will gain from the potential changes, but producers could lose welfare. If dieback resulting from additional forest fires, increased pest infestation, or storm damage increases appreciably and has market effects, consumers will gain less and producers will lose more than if climate change simply increases the annual flow of timber products by raising forest productivity. Annual producers' surplus losses from climate change in the North American timber sector are estimated to range from $1.4 -$2.1 billion per year on average over the next century, with the higher number resulting from potential large-scale dieback. Within North America, existing studies suggest that producers in northern regions are less susceptible to climate change impacts than producers in southern regions because many climate and ecological models suggest that climates become dryer in the U.S. South.Key words: climate change, impact analysis, timber markets, forest ecosystems RÉSUMÉ Cet article examine les effets potentiels associés aux changements climatiques sur les marchés du bois en Amérique du Nord. Les résultats démontrent que les changements climatiques pourraient accroître la productivité des forêts de l'Amérique du Nord, accroître la productivité des forêts à l'échelle mondiale et réduire les prix de la matière ligneuse. Les consommateurs nord-américains bénéficieront en général des changements potentiels, mais les producteurs pourraient encourir des pertes. Suite à la mortalité découlant des feux de forêts plus nombreux, de l'accroissement des infestations de ravageurs ou des dégâts provoqués par des tempêtes augmentant de façon appréciable, les consommateurs connaîtrons moins de bénéfices et les producteurs verront leurs pertes s'accroître si les changements climatiques accroissent simplement le volume annuel de produits forestiers suite à l'accroissement de la productivité. Les pertes annuelles pour les producteurs sont estimées être en 1,4 à 2,1 milliards de dollars par années au cours du prochain siècle, le montant supérieur résultant d'une forte mortalité à grande échelle. En Amérique du Nord, les études laissent entendre que les producteurs des régions nordiques connaîtront moins d'effets suite aux changements climatiques que les producteurs du sud parce que plusieurs modèles climatiques et écologiques suggèrent que le climat deviendra plus sec dans le sud des États-Unis.

Climate change impacts on forestry

“…2). Modeling studies generally predict further increase of global industrial roundwood production, with increases or decreases in prices in the future in the order of Ϯ20% (5,21,34,38,44,45,58), and with benefits of higher production mainly going to consumers. The future trend of fuel wood is more problematic depending in large part on the use to which wood is put to substitute for high-priced carbon-emitting fossil fuels.…”

Integrating climate change adaptation into forest management

“…There are numerous challenges to adaptation, not the least of which is the uncertainty in the magnitude and timing of future climate change. This is compounded by the uncertainty in the future markets for our forest resources and global competition (Sohngen and Sedjo 2005). The development of adaptation measures for some time in the future, under an uncertain climate, in an unknown socio-economic context is bound to be highly speculative (Burton et al 2002).…”

“…How will these changes affect industry viability, particularly as there will be an increase in global wood supply (Sohngen and Sedjo 2005)? Reforestation is based on the selection of species and provenances that are genetically adapted to the site (climate and soil).…”

“…Changes in forest productivity may be positive in some areas and activities such as stand management and forest protection to address climate change impacts will provide benefits to communities Williams 2005, Volney and. Changes in wood quality and timber supply will occur globally and market impacts will not be uniformly distributed (Sohngen and Sedjo 2005). Non-timber forest products (NTFPs) such as mushrooms, berries and botanicals are an important part of the rural economy (Forest Practices Board 2004).…”

Integrated modelling approaches to analysis of climate change impacts on forests and forest management

“…The importance of a comprehensive representation of global markets in analyses of the economic consequences of impacts of climate change in the forestry sector has been demonstrated in several studies of countries and regions. Sohngen and Sedjo (2005) analyze the impact on forest markets in the US of a global increase of timber supply. They conclude that consumers will probably gain, but producers may loose in terms of welfare.…”