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.
Highlights
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%)
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
In Alabama, a biomass stumpage price that could encourage landowners to invest in short rotation plantations was determined to be approximately $10.50/ton in the Piedmont (Kantavichai et al 2014), which is more than the current pulpwood price
Summary
Several studies on the economics of planting short rotation loblolly pine for biomass have been conducted in Southeast forests. In Alabama, a biomass stumpage price that could encourage landowners to invest in short rotation plantations was determined to be approximately $10.50/ton in the Piedmont (Kantavichai et al 2014), which is more than the current pulpwood price. Achieving those levels would likely require harvesting system improvements as well as tax and other incentives for short rotation biomass plantations to be economically viable
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