Profitability of the First Commercial Thinning, a Simulation Study in Northern Finland

Abstract

Despite positive signals from increasing growing stock volumes and improved roundwood trade, first commercial thinnings (FCTs) tend to be a bottleneck in Finnish forest management and forestry. The reasons are many, but probably the most crucial would be the lack of simultaneous economic incentives for participating agents, i.e., private forest owners and forest machine contractors. This is due to poor stand characteristics in most FCT cases: low cutting removal with small average stem size. There are five predetermined management options: (1) Industrial wood thinning with only two timber assortments, pulpwood and saw logs, (2) Integrated procurement of industrial and energy wood, (3) Energy wood thinning solely consisting of delimbed stems, (4) Whole-tree energy wood thinning with an energy price of 3 € m−3 and (5) Whole-tree energy wood thinning with energy price of 8 € m−3, that were applied for six separate forest stands located in Northern Finland, and derived from a database representing stands with an urgent need for FCT. Then, a two-phase financial analysis consisting of stand-level optimization (private forest owners) and profitability assessment (contractor) was conducted in order to find out whether there would be simultaneous economic incentives for both participants of FCT. The stand-level optimization revealed the financially best management options for a private forest owner, and then, for a contractor, the profitability assessment exposed the profit (or loss) associated with the particular management option. In brief, our results demonstrated that conducting either an industrial wood thinning (1) or an integrated procurement (2) resulted in a positive economic incentive for both the private forest owner and the contractor in all six cases (stands). Further, applying energy wood thinning with delimbed stems (3) would even generate a financial loss for the contractor, given the roadside prices applied in this study

Simulating alternative forest management in a changing climate on aPinus nigrasubsp.laricioplantation in Southern Italy

“…Selective thinnings induce an increase in mechanical stability, favor structural diversity, and reduce inter-tree competition for water, light, and nutrients (del Río et al, 2017; Marchi et al, 2018). However, tending and thinning interventions still represent a major passive management item in terms of costs and are often avoided in public forests resulting in a progressive degeneration of stand structure (Ahtikoski et al, 2021; Niskanen and Väyrynen, 2001). An additional, production-oriented option (‘ patch clearcut ’) simulating a complete harvest followed by replanting 80 years after the establishment of the plantation is also included.…”

The effects of the EU’s forest-related policies on harvesting costs in Finland

“…Many previous studies have been conducted on the effects of alternative operational conditions, harvesting system setups and business models for cut-to-length (CTL) harvesting. Static methods have been used to assess harvesting costs for different harvesting system setups in CTL-harvesting (Kärhä et al 2018;Triplat and Krajnc 2020;Ahtikoski et al 2021;Jonsson et al 2023). Dynamic and stochastic analyses have mostly been utilized for the comparison of, for example, different harvesting systems and operating models, where the temporal variation in the system and environment have been taken into account (Asikainen 2001;Talbot et al 2003;Väätäinen et al 2021).…”

Simulating diverse forest management options in a changing climate on a Pinus nigra subsp. laricio plantation in Southern Italy

“…Selective thinnings induce an increase in mechanical stability, favor structural diversity, and reduce inter-tree competition for water, light, and nutrients (del Río et al, 2017;Marchi et al, 2018). However, tending and thinning interventions still represent a major passive management item in terms of costs and are often avoided in public forests resulting in a progressive degeneration of stand structure (Ahtikoski et al, 2021;Niskanen and Väyrynen, 2001). An additional, production-oriented option ('patch clearcut') simulating a complete harvest followed by replanting 80 years after the establishment of the plantation is also included.…”