TITLE:
An Economic Analysis of Incorporating Biomass Thinning into Loblolly Pine Plantations in Alabama
AUTHORS:
Tom V. Gallagher, Rapeepan Kantavichai, Larry D. Teeter
KEYWORDS:
Biomass, Pre-Commercial Thinning, Stumpage Price, Nonindustrial Private Forests
JOURNAL NAME:
Open Journal of Forestry,
Vol.7 No.2,
April
13,
2017
ABSTRACT: The objective of this study was to perform breakeven analysis of a stumpage biomass price that would induce landowners to modify their management regimes to incorporate an early thinning for biomass products. Following the biomass thinning, traditional harvest of pulpwood and timber products would be conducted. The feasibility analysis of incorporating biomass thinning as a potential product for a biomass market was examined for Piedmont and Coastal Plain site scenarios in Alabama. We compared our proposed biomass thinning regime with a traditional management regime. In the Piedmont site scenario, the minimum biomass breakeven prices were lower than current pulpwood prices ranging from $4.75 to $7.87/ton depending on the discount rates applied (5%, 7%, and 9%). However, the minimum breakeven prices were higher than pulpwood prices at all discount rates for the Coastal Plain site scenario. A benefit of early thinning improved sawtimber proportion in the final harvest of products based on PTEADA 4.0 simulations. Increases in sawtimber prices allow for lower biomass breakeven prices. Minimum biomass breakeven prices decreased by 13%, 30% and 70% when timber price increases were 20%, 50% and 100%, respectively, under a 7% discount rate for the Piedmont site scenario.