Hybrid Poplar Plantations in the Lake States--A Financial Analysis

Authors: Ferguson, Karen D.; Rose, Dietmar W.; Lothner, David C.; Zavitkovski, J.

Source: Journal of Forestry, Volume 79, Number 10, 1 October 1981 , pp. 664-667(4)

Publisher: Society of American Foresters

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Abstract:

Hybrid poplar plantations in the Lake States may be a low-cost alternative to conventional sources of wood fiber for industrial users in some areas, but in most areas at this time they are high-risk, low-return investments. On the basis of our specific assumptions and 1979 prices, the return on investment of nonirrigated plantations is projected to be 8 percent. Irrigated plantations have a slightly negative rate of return. Rates differ little between short (5 to 10 years) and long (15 years) rotations. Investment performance measures are most sensitive to estimates of product sale value, yields, irrigation costs, and harvesting costs. The economic feasibility of various intensive production systems would be enhanced if irrigation costs could be reduced and if much higher prices could be obtained for wood fiber. Price increases would, however, tend to sustain the greater economic attractiveness of nonirrigated systems.

The detailed sensitivity analyses carried out in the study will permit periodic reevaluation of the economic attractiveness of intensive culture systems as better information becomes available and as significant changes in prices and costs occur.

Document Type: Journal Article

Affiliations: Research Forester, North Central Forest Experiment Station, Rhinelander, Wisconsin

Publication date: October 1, 1981

More about this publication?
  • The Journal of Forestry is the most widely circulated scholarly forestry journal in the world. In print since 1902, the Journal has received several national awards for excellence. The mission of the Journal of Forestry is to advance the profession of forestry by keeping forest management professionals informed about significant developments and ideas in the many facets of forestry: economics, education and communication, entomology and pathology, fire, forest ecology, geospatial technologies, history, international forestry, measurements, policy, recreation, silviculture, social sciences, soils and hydrology, urban and community forestry, utilization and engineering, and wildlife management. The Journal is published bimonthly: January, March, May, July, September, and November.
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