MODELING IMPACTS OF BIOENERGY MARKETS ON NONINDUSTRIAL PRIVATE FOREST MANAGEMENT IN THE SOUTHEASTERN UNITED STATES

Abstract The potential impacts of bioenergy markets on slash pine plantation management on nonindustrial private forestlands in the southeastern United States were analyzed. We developed an integrated Black–Scholes and modified Hartman model to achieve this task. The risk of damage from catastrophic natural disturbances such as wildfires and pest outbreaks associated with the exclusion/incorporation of thinnings and variation in timber salvage rates was also included. Three scenario sets were considered: status quo or no thinning scenario, thinning scenario for pulpwood, and thinning scenario for bioenergy at differing levels of risk and salvage. The results indicated that the incorporation of thinnings either for pulpwood or bioenergy increases the forestland value regardless of the risk when the salvage value of the stand is 0.8. When the two thinning scenarios were compared, the land expectation value for the thinning scenario for bioenergy was greater at any level of risk compared with the thinning scenario for pulpwood, averaging a difference of 11.5% and 11.7% for salvageable portions of 0.8 and 0, respectively.

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