Parkside Gully OFRI April30 2008

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					      Parkside Gully Tolerant
    Hardwood Selection Harvest
    and Product Recovery Study

                                    Bill Cole, Elaine Mallory,
                                    Jeff Kokes, Jennie Pearce




             OMNR
Ontario Forest Research Institute
          30 April 2008
 Study Location




30 April 2008     Cole/OFRI   2
 Brief Project History
 3 demonstration projects                Tea
                                          Lake
  started in 1965-1967 at                             Swan
  Swan Lake                                            Lake
                                    Hwy
 Two stands harvested               60

  (12 ha)                                 Harvest
 Two stands uncut (12 ha)
                                                    Uncut
 Harvests occurred in 1967,
  1980, 1992, 2005                     Swan Lake
 Data collection years:            Forest Research
     1965, 1966, 1967, 1968,           Reserve
     1974, 1976, 1978, 1980,                        Harvest
     1981, 1984, 1987, 1990,
     1992, 1993, 1997, 2005,                        Uncut
     2006

30 April 2008           Cole/OFRI                             3
Current Project
Study objectives:
 To compare growth rates and stem quality development
  in managed stands vs. uncut control stands over 40 years;
 To compare managed and unmanaged stands after
  40 years using two indicators:
     - downed coarse wood
     - understory vegetation composition;
 To compare the quantity, quality and economic
  values of products generated from 2005 harvest
  to average regional yields from two perspectives:
     - forest land manager
     - forest products manufacturer.

30 April 2008            Cole/OFRI                      4
    Methods                   We used lots of methods…including
      Measuring trees and stands
      before and after 2005 harvest




                                           Tallying and scaling logs during
                                           the December 2005 harvest

      Tracking all logs through the        Summarizing
      Huntsville sawmill                   board grades
                                           and yield from
                                           the sawlogs




30 April 2008                         Cole/OFRI                               5
Results
                                       Parkside Gully Single-Tree Selection Study
                           150                   Diameter Distribution
                           140
                           130
                                                       Theoretical "reverse-J" curve (q=1.38)
                           120
                                                       2006 Post-harvest
                           110
                                                       1967 Pre-harvest
                           100
                Trees/ha




                           90
                           80
                           70
                           60
                           50
                           40
                           30
                           20
                           10
                             0
                                 5   10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90

                                                      5 cm DBH Class

30 April 2008                                      Cole/OFRI                                    6
 Results
                                29                      Net stand basal area
                                28                    (10 cm class and above)
                                27
     Stand basal area (m2/ha)



                                26      1967
                                25      Harvest
                                        10.6 m2/ha            1980                                   2005
                                24                                              1992
                                                              Harvest                                Harvest
                                23                                              Harvest
                                                              5.5 m2/ha                              4.9 m2/ha
                                                                                4.6 m2/ha
                                22
                                                                                                         GLSL & South.
                                21                                                                       Residual BA
                                20                                                                       target
                                19                                                                        North Shore
                                18                                                                        Residual
                                                                                                          BA target
                                17
                                16        13 yr interval       12 yr interval     13 yr interval
                                15
                                 1965   1970   1975    1980     1985    1990    1995   2000   2005

                                                                 Year
30 April 2008                                                 Cole/OFRI                                          7
       Results
       Parkside Gully - Average annual basal area growth


                                         Basal area growth, 1992-2005
                                                      (m2/ha/yr)
                   1992
                 Basal area   Survivor                 Gross                    Net
                  (m2/ha)      growth      Ingrowth    growth      Mortality   growth
 PG1 – harvest     17.7        0.35          0.09        0.44        0.05       0.38
 PG3 – control     29.2        0.22          0.04        0.26        0.41      -0.15




30 April 2008                         Cole/OFRI                                         8
   Results             Logging Damage
        Provincial logging damage standard:
        • 85% of residual BA ( trees > 10 cm) free from major damage
        • 90% of residual AGS trees free from major damage
        • damage not concentrated in one size class

        Parkside Gully logging damage (2005 winter harvest):
        • 98.5% of residual basal area (trees > 10 cm dbh) free from
          major damage after 1992 harvest
        • 97.8% of residual basal area free from major damage after 2005
          harvest
        • Woods et al. (2007) found 90.6% residual basal area free from
          major damage in their sampled crown land stands


30 April 2008                    Cole/OFRI                             9
  Results                Vegetation impacts after 40 years of
                         single-tree selection management:

         •      Very little difference in observed patterns of species
                distribution in overstory or understory
         •      Uncut and harvested stand overstories were dominated by
                sugar maple and beech, with small amounts of yellow birch,
                hemlock, and white spruce
         •      Tree regeneration dominated by sugar maple and beech
         •      Scattered patches of yellow birch, white spruce, balsam fir
                and ironwood regeneration in both
         •      Shrub layer dominated by hobble bush and striped maple,
                with small amount of mountain maple and beaked hazel



30 April 2008                          Cole/OFRI                              10
  Results                 40-year management impacts on
                          snags and downed coarse wood
                                                        Harvested        Control
                                                   PG1         SI     PG3     TMTP
 1   Stand size (ha)                                10         2.2     7.6         4
 2   Mean DBH (cm)        Snags                    25.8       23.3    36.4     37.4
 3                        Downed wood              19.5       15.7    25.1     22.0
 4   Density (stems       Snags                     10         12      40          38
 5   or # pcs./ha)        Snags/100 live trees      2.5        3.1    10.8     10.5
 6                        Downed wood              280.5      417.8   324.0   404.5
                     2
 7   Basal area (m /ha)   Live trees               22.9       22.8    27.6     26.0
 8                        Live trees ≥ 60cm DBH     1.1       0.83     4.3     4.0
 9                        Snags                     0.7        0.7     5.4     5.3
                3
10   Volume (m /ha)       Downed wood              40.3       21.1    73.8     99.0
11   Mean decay class     Snag                      3.2        3.6     3.7     3.9
12                        Downed wood               4.0        4.1     3.6     3.6




30 April 2008                               Cole/OFRI                                   11
 Methods                 Economic analysis – Forest manager


 Parkside Gully Study assumptions and calculations
 • Tonnes harvested and transported to Huntsville-Tembec mill
      (44.4 tonnes/ha)
 • Calculate gross revenue for logs harvested using 2005 log prices ($)
 • Summarize total gross logging costs ($)
 • Calculate total gross logging cost ($/tonne)
 • Calculate total 2005 net log revenue
       (gross revenue – gross logging cost) ($)
 • Calculate net revenue per ha harvested ($/ha)



30 April 2008                    Cole/OFRI                           12
 Results                        Economic analysis – Forest manager



2005 Parkside Gully Harvest                                              tonne    2005      Gross
        (observed)                %    tonnes    %      tonnes    %        s     $/tonne   revenue
Total volume to mill (tonnes)           541.7
Hardwood volume                  100    541.7
    Hardwood sawlogs                             75.1    407.0
         Hard maple logs                                          91.3   371.4    $ 99     $ 36,678
         Soft maple logs                                           0.3     1.0    $ 50      $    52
         Beech logs                                                8.2    33.4    $ 45      $ 1,503
         Yellow birch logs                                         0.2     0.7    $ 60      $    42
    Hardwood pulp                                24.9    134.7   100.0   134.7    $ 30      $ 4,041
Softwood volume                    0




 30 April 2008                                  Cole/OFRI                                       13
 Methods                Economic analysis – Forest manager

 Bush run assumptions and calculations
 • Average tonnes harvested from recent operations (50 tonnes/ha)
 • Multiply by Parkside Gully harvest area for comparable expected
          tonnes harvested
 • Calculate expected log yield by species and log grade using
         average bush run data and expected tonnes harvested
 • Calculate expected bush run gross revenue using estimated yield and
         2005 log prices ($)
 • Calculate expected gross logging costs using average costs and
         expected tonnes harvested ($/tonne)
 • Calculate expected net revenue for 2005 bush run harvest ($)
 • Calculate expected net revenue per ha harvested ($/ha)

30 April 2008                  Cole/OFRI                             14
 Results                    Economic analysis – Forest manager

      Bush run Harvest                                                         2005      Gross
        (Expected)             %    tonnes     %    tonnes     %    tonnes    $/tonne   revenue
Average tonnes expected from
12.2 ha @ 50 tonnes/ha               610.0
Hardwood volume (% total
volume)                        90    549.0
    Hardwood sawlogs                           40    219.6
        Hard maple logs                                        80    175.7       $ 99   $17,348
        Soft maple logs                                        4        8.8      $ 50    $   439
        Beech logs                                             4        8.8      $ 45    $   395
        Yellow birch logs                                      12     26.4       $ 60   $ 1,581
    Hardwood pulp                              60    329.4                       $ 30    $ 9,882
Softwood volume (% total
volume)                        10     61.0
    Softwood sawlogs                           85     51.9
        Hemlock logs                                           60     31.1       $ 35    $ 1,089
        Spruce & balsam logs                                   40     20.7       $ 60    $ 1,244
    Softwood pulp                              15        9.2                     $ 20    $   183

 30 April 2008                               Cole/OFRI                                       15
 Results                        Economic analysis – Forest manager



2005 Parkside Gully Harvest                                                       2005      Gross
        (observed)                %    tonnes    %      tonnes   %      tonnes   $/tonne   revenue
Total volume to mill (tonnes)           541.7
Hardwood volume                  100    541.7
    Hardwood sawlogs                             75.1    407.0
         Hard maple logs                                         91.3    371.4    $ 99     $ 36,678
         Soft maple logs                                          0.3      1.0    $ 50      $    52
         Beech logs                                               8.2     33.4    $ 45      $ 1,503
         Yellow birch logs                                        0.2      0.7    $ 60      $    42
    Hardwood pulp                                24.9    134.7                    $ 30      $ 4,041
Softwood volume                    0




 30 April 2008                                  Cole/OFRI                                       16
 Results                 Economic values – Forest manager

                                           Estimated 2005        2005 observed
                                            AFA bush run           Parkside
                                               harvest            Gully harvest
  Total gross revenue ($) a                           $ 32,162         $ 42,316
  Logging costs ($/tonne) b                               $ 40             $ 43
  Total logging costs c                               $ 24,400         $ 23,206
  Total net revenue d                                  $ 7,762         $ 19,110
  Total net revenue/ha ($/ha)                           $ 636           $ 1,566


 a. From 12.2 ha
 b. Bush run logging costs range from $34-$46/tonne
 c. Logging cost x tonnes harvested
 d. (total gross revenue) – (total logging costs)


30 April 2008                        Cole/OFRI                              17
 Methods                      Economic analysis – Forest manager
    •   Many (but not all) natural resource economists assume that $100
        in hand today is worth more than $100 expected to be received in
        the future
    •   To compare equivalent value of benefits in one year with those in
        a future year, a discount rate is applied to the future expected
        dollar value when estimating its net present value (NPV):


                NPVbase yr = (future value) ,    where
                                 (1+DR)y
        DR = discount rate, usually 0 < DR < .10
        y = (future year) – (base year), or number of years over which the
        discount is calculated


30 April 2008                        Cole/OFRI                               18
Results               Economic analysis – Forest manager

Economic analysis question:
      What is the expected net present value (NPV2005) of the
       Parkside Gully harvests vs. average bush-run harvests over
       26 years ($/ha)?
      But for which 26 year harvest cycle?
                                           Harvest Years
                             1980    1993       2005   2018    2031
                 Bush run     X                   X              X
            Parkside Gully    X        X          X        X     X

                                  Option 1
                                                                  Option 2
                                                                      Option 3

30 April 2008                       Cole/OFRI                              19
Results               Economic analysis – Forest manager


                     Net Present Value (2005) - Option 2
                          $3133
            $4,000                    $2777
NPV 2005




                                                   $2216
            $3,000
  ($/ha)




                                                             Δ = 3.4 - 4.9x
            $2,000
                        $636        $636         $636
            $1,000
                $0
                       0.00       0.02          0.07
                                                           Bush run
                              Discount rate                Parkside Gully


30 April 2008                       Cole/OFRI                                 20
Results              Economic analysis – Forest manager


                Net Present Value (2005) - Option 3

                        $3133
           $4,000
NPV 2005




                                   $2145
           $3,000
  ($/ha)




                                                 $ 920
           $2,000
                      $636                                Δ = 4.9 - 8.4x
                                 $380
           $1,000                              $110

                $0
                     0.00       0.02          0.07
                                                         Bush run
                            Discount rate                Parkside Gully


30 April 2008                     Cole/OFRI                                21
 Methods                  Economic analysis – Mill manager

 Mill analysis assumptions and calculations
 • Observed actual Parkside Gully product yield for maple and
   beech, based on 407 tonnes processed at Tembec-Huntsville
 • Value ($/FBM) for each product class from February 2006
   mill prices
 • Sawlog costs at mill gate to forest manager
   (pulpwood costs and revenues not included in mill analysis)
 • Net revenue for logs sawn from Parkside Gully harvest
         (excl. other mill costs, e.g., depreciation, energy, labour)
 • Net revenue per tonne processed




30 April 2008                     Cole/OFRI                             22
 Methods                Economic analysis – Mill manager

 Mill analysis assumptions and calculations
 • Estimated equivalent bush run product yield for maple and beech,
        based on same tonnage used to calculate log costs
        (220 tonnes)
 • Value ($/FBM) for each product class from February 2006 mill
        prices
 • Sawlog costs at mill gate to forest manager
        (estimated for bush run)
 • Pulpwood costs and revenues not included in mill analysis
 • Net revenue and net revenue per tonne processed




30 April 2008                  Cole/OFRI                              23
  Results              Economic analysis – Mill manager

                                        Estimated
                                      equivalent bush
Net revenue calculations                    run          Parkside Gully
Maple sawn product revenue ($)                $34,341          $67,407
Beech sawn product revenue ($)                + $2,337         + $9,529
Total sawn product revenue ($)                $36,678          $76,936
Hardwood log cost
(excluding pulp) ($)                         - $19,764        - $38,275
Net revenue ($)                               $16,914          $38,661
Tonnes processed                                   220              407
Net revenue/tonne ($/tonne)                        $77              $95



 30 April 2008                   Cole/OFRI                           24
Conclusions
 Productive site with little or no high-grading history

 Provincial single-tree selection management guidelines,
    marking for quality improvement using careful logging

 Periodic annual increment (0.38-0.47 m2/ha/yr) as
    expected from silviculture guide and some Ontario field
    studies (e.g., Stokes study); Not extreme or unrealistic

 We have sustainable basal area growth with commercial
   harvest every 12-13 years over 40 years, although
   may not be practical for all sites or stands


30 April 2008               Cole/OFRI                       25
Conclusions
After 4 cuts stands are approaching but have not quite
    reached desired diameter/basal area structure –
   (still a bit understocked in high-quality small sawlogs)

Minimal impacts detected on overstory and understory
   woody species composition

Snags in harvested stands had smaller diameter and
   lower density (#/ha) than uncut controls

Downed coarse wood in harvested stands had similar
  number of pieces as uncut stands (#/ha), but smaller
  diameter and lower volume than uncut control stands

30 April 2008              Cole/OFRI                          26
Conclusions
  Forest land manager yielded ~ 3.4 – 8.4x net revenue
     from well-managed high-quality hardwood stand
     compared to current average crown land over 26
     year management cycle, depending on economic
     assumptions made.

  Forest mill manager yielded ~ 1.2x net revenue in sawn
     boards from high-quality Parkside Gully harvest
     compared to typical bush run (conservative – no
     veneer from Parkside Gully)




30 April 2008             Cole/OFRI                        27
  Closing thoughts
 Careful long-term
  tolerant hardwood
  silviculture on good
  sites pays!

 If you have good quality
  within stands, try to protect
  or improve it.

 Through policy, guidelines, practices, and science transfer, we
  should be encouraging tolerant hardwood management on
  15-20 year re-entry cycles, not accepting 25+ yrs as the norm.

 Contact OFRI or the Forestry Research Partnership to
  arrange a tour of the Parkside Gully study area.


 30 April 2008                    Cole/OFRI                    28
 Acknowledgements
Thanks to
 Living Legacy Research Program
 Enhanced Forest Productivity Program
 Forestry Research Partnership – Al Stinson, Nancy Young
 Algonquin Provincial Park – Jim Murphy, Brad Steinberg,
   Joe Yaraskavitch, John Swick
 Algonquin Forestry Authority – Bill Hubbert
 Tembec-Huntsville – Gerald Kroes, Alex Encil
 Southern Science and Information staff - Murray Woods,
   Wayne Reid, George Sanshagrin, Johnny Belanger, Andrea Knapp
 Harvey Anderson, Elaine Mallory, Jeff Kokes, Jim Rice, Randy Fawcett
 Al Corlett, Margaret Penner, Tony Kennedy, Marvin Chartrand

30 April 2008                  Cole/OFRI                          29
                Thank you




30 April 2008      Cole/OFRI   30
  Results
  Basal area by diameter class & basal area growth
                                            Diameter class (cm)
           Year            10-24    26-36         38-48           50+    Total
1967 Pre-harvest (m2/ha)    3.7       8.1          10.1           5.6    27.4
   1967-1979 Periodic
    Annual Increment       -0.01     0.00          0.21           0.24   0.45
       (m2/ha/yr)
   1980-1992 Periodic
    Annual Increment       0.09      0.02          0.07           0.28   0.47
       (m2/ha/yr)
   1992-2005 Periodic
    Annual Increment       0.10      0.03          0.09           0.17   0.38
       (m2/ha/yr)
    2006 Post-harvest
                            4.1       3.8           6.0           3.9    17.8
         (m2/ha)
  Marking targets (2005)    6         6             5              3
                                                                          20
   (1998 Silv. Guide)       6         8             3              3


30 April 2008                      Cole/OFRI                                     31
              Results
 2006 hardwood board prices
 Hard maple                          $/MFBM                     Beech           $/MFBM

 Select Sapwood & better             $2,275               Select Unspecified     $625
 4&5' clear No.1 common sapwood
 &better boards and 6' select
 sapwood & better boards             $1,680                    7x9 Ties          $590

 No.1 Common Sapwood & better        $1,632                    6x8 Ties          $460
 No.2 & No. 3a common #1&#2                                No.1 Common
 White                                $960                  Unspecified          $425
                                                          4'' x 6'' Heartwood
 No.2 & No.3a common Sapwood          $860                      squares          $390
 No.2 & No.3a Unselected for color                        4'' x 4'' Heartwood
 6¼”                                  $657                      squares          $390
                                                           No.2 Common
 No.2 & better Regular                $625                  Unspecified          $300

 2”x3” heartwood squares              $403                 No.3 Common           $240

 3”x3” heartwood squares              $403
 No.2 & No.3a Regular (Truck
 Flooring)                            $374

 No.3b Common                         $235


30 April 2008                                 Cole/OFRI                                  32

				
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