Forecast Future Values Estimate Harvest Probability Apply Expansion Factors

Separate literatures exist to describe responses of timber owners and aggregate timber supply to product prices. While few investigators have alluded to the effects of varying inventory quality and ownership mix on the aggregate response, it is possible to describe how the responsiveness to prices can vary over time as the vintage of the timber inventory shifts. We estimated a probit harvest model using stand-level periodic forest inventory data and modeled the effects of price changes on aggregate supply. The stand-level data were obtained from fixed plots from loblolly pine stands in the coastal plain of North Carolina. By applying the estimated harvest decision model to each stand and multiplying product volumes by associated area expansion factors, we observed the effects of price perturbations on aggregate harvest quantities. The harvest model included data on sawtimber and pulpwood volumes, which enabled a simulation of the effects of changes in either product price or inventory characteristics on the production of pulpwood and sawtimber. To illustrate the effects of varying inventory characteristics, we evaluated harvest responsiveness in two periods. First, we calculated the supply elasticity with respect to price given the inventory of 1983-1989. Then, using alternative estimates of timber supply characteristics existing in 1995, we estimated the supply elasticity with respect to price given the inventory of 1989-1995. Differences in supply responses between the two periods are traced to evolving inventory vintages and changing quantities of inventory under NIPF and industry management.