Forest management, conservation, and global timber markets

This article develops a global timber market model which captures how timbe r supply reacts to future predicted increases in the demand for timber. Hig her future demand is expected to increase prices, increase investments in r egeneration, increase establishment of plantations, and expand output. Dyna mic market responses imply a greater reliance on plantations in productive regions, allowing large areas of natural forest in low-valued regions to re main largely intact. Sensitivity analysis suggests that price, harvest, and management are most sensitive to the rate of demand increase, the interest rate, the cost of plantations, and access costs of natural forests. Two fo rest conservation strategies are examined which predict the system-wide imp lications of forest conservation in Europe and North America. The policies indicate that whereas set asides can induce net conservation, harvests incr ease elsewhere, particularly in natural forests.