Logging firms, nonindustrial private forests, and forest parcelization: evidence of firm specialization and its impact on sustainable timber supply

Increasing forest parcelization has raised concerns about tract-size economies and sustainable timber supply. We explored this issue by examining the logging sector and forest ownership in northern Wisconsin and Michigan's Upper Peninsula. Using 2004 survey data, we found that 48% of logging firms demonstrated a near exclusive reliance on nonindustrial private forests (NIPFs). NIPF-dependent firms derived 87.5% of their stumpage from this ownership, whereas nondependent firms exhibited a significantly more diversified stumpage supply dis- tributed among public (42.6%), industrial-corporate (33.3%), and NIPF (24.0%) sources. Additionally, NIPF- dependent firms operated on significantly fewer, smaller, and less intensely harvested timber sales, and they were more likely to harvest small tracts profitably. There were no significant differences in the forest products harvested or overall firm profitability. We found statistical evidence that NIPF-dependent and nondependent firms organize them- selves differently: NIPF dependency was negatively correlated with total number of employees, timberland area in the firm's wood basket, and firm location and positively correlated with owner age. Results suggest the impacts of parcelization on the logging sector are minimal. NIPF-dependent firms appear to have structured themselves to oper- ate profitably; however, it is unclear how continued parcelization might influence these firms and the sector as a whole. Resume : L'augmentation du morcellement des forets a souleve des preoccupations concernant les economies reliees a la dimension des parterres de coupe et l'approvisionnement durable en matiere ligneuse. Les auteurs explorent cet enjeu en examinant le secteur de l'exploitation et les tenures forestieres au nord du Wisconsin et dans la Peninsule du Haut Michigan. En utilisant des donnees d'inventaire de 2004, ils ont trouve que 48 % des entreprises d'exploitation dependaient presque exclusivement des lots boises non industriels (LBNI). Ces entreprises obtiennent 87,5 % de leur bois sur pied de ce type de proprietes alors que les entreprises qui n'en dependent pas ont des sources d'approvisionnement significativement plus diversifiees comprenant des terres publiques (42,6 %), des terrains industriels ou corporatifs (33,3 %) et des LBNI (24,0 %). De plus, les entre- prises qui dependent des LBNI realisaient significativement moins d'operations, sur de plus petits territoires et de maniere moins intensive. Elles avaient aussi plus de chances de recolter de maniere rentable de petits parter- res de coupe. Les produits recoltes et la rentabilite globale des entreprises ne presentent aucune difference si- gnificative. Des indices de nature statistique montrent que les firmes dependantes et non dependantes des LBNI s'organisent differemment : la dependance aux LBNI est correlee negativement avec le nombre total d'employes, les aires de coupe accessibles a l'entreprise, la localisation de la firme et positivement avec l'âge du proprietaire. Les resultats indiquent que l'impact du morcellement sur le secteur de l'exploitation est minimal. Les firmes dependantes des LBNI semblent s'etre structurees pour operer de maniere rentable. Cependant, on ne sait pas quelle influence le morcellement accru des territoires forestiers aura sur ces entreprises et le secteur dans son ensemble. (Traduit par la Redaction) Rickenbach and Steele 194

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