Sustained forests; sustained profits

[ HOME | Lasting Forests Home | Table of Contents | The Finder | Glossary ]

The Planned Details of the Forest Group Work

There is no best place to start in forest or land use system planning or development. It must be inclusive and concentrating not on start-up time but on operating effectively. The following text outlines our details of the forest-only operation. It needs to be done within the context of changing staff, ideas, technology, and product prices among:

• easements (number and acreage)
• recycling committments
• training programs
• technical assistance
• marketing opportunities
• style or preference shifts in wood products or color and texture
• health and medical changes (allergies, threats, toxic findings)
• planned urban development an green space
• opening (or closing) of international markets
• strategies with endangered species.

We have to develop details for successsful operation on the individual tract of land that is most likely to achieve out objectives.

• We start with the assumption that the yield which will be sustained is profit.
• The total ownership is the land to be managed. The land which grows trees is the primary topic for this group but it must be done in the context of the costs and gains of other activities of the ownership. For example, to make gains in livestock production and to pay extra (unnecessary) tax costs due to forest harvesting is not achieving the desired net effect of total land use and optimization.

  We compute the profitability analysis of the entire system. We work with trees because of our background and organizational dominance but cannot see all profitable components of the enterprise, the conglomerate, for the longterm, and expect that elements will change in financial importance. Tree-related profits will not be most dominant every year.

• We are customizing the land ownership for lasting profits for the thoughtful owner. In Pennsylvania in 1980, for example, few people used foresters, even knew what they did, or what to expect from their service, and did not know whom to contact if they thought they might need one. Based on studies of land owners, we know that their knowledge and attitudes are changing and have changed greatly over the past 25 years. They typically do not live in the rural areas, are not farmers, not anti-environmental, and are well-educated, white-collar, and many are retired. They own 58% of the commercial forest land in the US. We know that they own forested land to "rebuild the spirit," "preserve nature," "maintain scenic beauty," and for "viewing wildlife." We also know that they appreciate management and efficiency, do not like to pay taxes, are frustrated by increasing real estate taxes, and experience drastic changes in attitudes toward their land in economic crisis, family disputes, heavy educational or other cost environments, and when incapacitated by injury or other causes. We believe that "achieving abundant profit from the land" is a hidden objective, unlikely to be openly, if ever, expressed. We believe that maximizing profits is a major objective, subject to being sure to be able to achieve the other objectives. We see no way to prove realistically the negative: "we do not want profits." We work to develop a sound base for achieving their personal reasons for holding land for the long term as well as for a sound financial condition.

  We provide them with informed forestry actions that have powerful personal and public consequences and that meet their personal, stated objectives.

• We are always constrained by the wishes of the land owner, no matter how different, inconsistent, etc. those wishes may be. These wishes (expressed within a set of carefully developed "objectives" ) are as real as the limits on staff, investment funds, and equipment. They may limit profitability, but our objective is lasting profitability of a particular, unique piece of land, the uniqueness of which may be the owner's objectives and stated limits. We already know the unit of land is unique. We will show to some extent, the differences that would exist if select limitations were reduced or objectives changed. We acknowledge the importance of personal, often- unexplainable objectives and limitations of the landowner and make no further analyses or judgements.
• Few land ownerships are large enough for economical development over time. They have been split by inheritance, sales, emergencies, and even highway and topographic features. We offer opportunities to participate in a cooperative, one organizing producers for specialized products, uses, and services, all with the objective of lasting constrained net present-discounted profits.
• We believe that many products of forest lands such as clean water and carbon storage can be more economically important and socially valuable than timber sales over time. We reject the choice of either/or and believe that concentrating on net valuations, the production of reasonable profits and sustaining the ability to produce those profits and developing other sources is responsible land use. Wood sales "paid the bills" in the past. Now there needs to be more profitability for land to remain in forests in the face of urban sprawl, increasing populations, and other land uses. The needs, as never before, are for maximum wood production, avoiding the areas unable to grow quality available wood rapidly, and restoring harvested tracts.That all has to be done while facing normal needs, meeting extraordinary circumstances, meeting regulatory requirements and costs, and facing increasing taxes and fluctuating markets. The needs are beyond the average landowner. The chances for sub-optimization are great. Thus there are needs for services of The Forest Group.
• Out planning period is 150 years. This is advanced one year, each year. It is a sliding planning horizon. We attempt to accommodate with its use some of the concepts of old-growth timber, ancient forests, and intergenerational equity. We also compute other alternatives and include short rotation strategies for certain timber types and pastures on computer-selected sites.
• We compute in our analyses a table of probable consequences of taking planned actions. The consequences are first estimated physical changes, then likely financial changes given certain use rates. We list the groups of actions as projects, then show high, low, and likely returns (3) from each using bank rate, actual, high and low (3), thus a 3 x 3 table for each project. Each set of 9 computed results is further presented as
  • consequences of inaction
  • consequence of partial allocation of funding to implement the projects
  • consequences of desired maximum allocation
  Over allocation is discouraged.

  All are computed for a 150-year planning period as well as a stated planning horizon of the land owner (or a computed one based on the life expectancy of the owner and or the children.)

  These reports are issued every 2 years (data sliding ahead one year) or on demand.

  A before-and-after quiz might be used to evaluate change in knowledge about forestry as done in a Pennsylvania study

  To gain insight into woodland owners knowledge of conservation and forestry, we asked our respondents to indicate whether each of the 10 statements listed below was true or false. The responses considered correct are those that a professional conservationist would give. Owners were encouraged to check "don't know" rather than guess. Statement 1. Conservation means that natural resources should be used wisely. Most Pennsylvania land owners (80%) had a fundamental understanding. 2. Once a forest is cut it will not grow back unless planted.26% did not know a forest will grow back naturally 3. Sustained yield is an important forestry objective.hardly seems fair but only 54% said it was true 4. Clearcutting is always bad forestry.34% answered correctly suggesting great confusion 5. All forest land in the United States is managed. 66% knew this answer was false 6. Selective logging is always good forestry. only 9% answered correctly 7. Commercial forest land is forest land that is owned by wood-using industries, 21% got it correct 8. An ecosystem is any complex of living organisms together with their environment.only 2 percent were incorrect; 51% said they did not know ... suggesting that they were not just guessing at the answers. 9. A virgin forest is any forest of old or large trees. 36% 10. Stumpage price is the price paid for standing timber.few knew; 40% said that they did not know

• We use the present-discounting procedures. We recognize the limitations and understand the difficulties expressed in the literature of public wilderness area management. We use the best advice available from the literature on intergenerational conflicts related to investment policy and
  • use conventional discounting as well as the realizable rate of return from re-investments (Schallau, C.H. and M.E. Wirth 1980) which is typically higher than the Internal rate of return and provides stronger guidance for comparisons of projects and for profitable action.
  • remove select areas from any computation - hold them as protected reserves and refuges, partially as an insurance policy, partially as a contribution to the social "good."
  • use the finances of the total land system, a new enough concept for which there is little guidance by economists.
  • use value-adding concepts (expansions of up to 70 times the value of stumpage).
  • work through scenarios to test the importance and relevance and priorities for work: for example, if we assume ... being developed.
• We use the Lasting Forest superior operations set (SET), tending to object to "best management practices" a phrase without stated objectives, time, location, duration or cost considerations.The SET (following work by Black and Clark, USDA Southeastern For. Exp. Sta.) includes solid planning and road layout in the fall or winter, working every month, locating roads away from streams, draining the roads well, rarely allowing inside edge drainage, using road dips at distances specified by the slope, using a trained company dozer operator and equipment, constructing roads on the contour and with less than 10% slopes, using gravel at stream crossings, using gravel on road spots as needed immediately after rains, only crossing streams at a right angle, usually using culverts or bridges or metal road bedding at stream crossings, making shallow bank cuts, leaving vertical bank cuts, using a leaf blower to blow duff and seeds from upper edge onto the cut bank for native revegetation, seeding with recommended grouse and turkey grasses and forbs, felling trees downhill, topping them and removing branches, leaving tops where they lay (with a few cuts to reduce their height), bucking logs only after choking and skidding them uphill to a log deck, usually using an A-frame (2 25-foot booms, a winch and 6-cylinder truck engine mounted on skids so it was easily moved between sets; maximum pull distance was 600 feet; using a dozer for other trees not easily handled with the A-frame), , avoiding mud on the highway at entrance, using educational signs, conducting field trips, assuring site-specific reforestation, smoothing over the road bed after logging, and achieving adjacent stream pollution of less than US Public Health Service standard for sediment (less than 10 ppm). The financial meaning of the above for operators and investors is: little or no adverse litigation, no slow down in removals, hauling big loads in less time, longer lasting tires, fewer breakdowns and stoppages, skidding and loading with one unit, less truck repair, increased probability for repeat work.
• A long checklist of the things to do in the SET is printed and a scoring system used, 0 to 10 for each, 10 representing the observation by a supervisor or inspection panel of the best currently known implementation of each action.

  ---

• Forest products include: mushrooms, florals and greens, Christmas trees, medicinals, fence wood, and wildlife. See extensive lists in Ecological Services and non-timber products

We believe these are consistent with and in most cased exceed the requirements and intent of the AF and PA sustainable forestry and the SmartWood programs.

References

Birch, T.W. , and D.F. Dennis. 1980. The forest-land owners of Pennsylvania, USDA For. Serv. Resource Bul. NE-66, NE Forest Exp. Sta, Broomall, PA 90pp.

Schallau, C.H. and M.E. Wirth .1980 Reinvestment rate and the analysis of forestry enterprises. J. Forestry 78(12):740-742.

Return to the top.

This Web site is maintained by R. H. Giles, Jr.
Last revision January 17, 2000.