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A Financial Analysis of Small-Scale Tropical Reforestation with Native Species in Costa Rica

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Abstract:

In 1990 four Peace Corps Volunteers in Costa Rica completed their service and started a private reforestation project. The goal was to see if a small tree plantation could be profitable compared with traditional land uses. This article discusses the economics of the first 15 years of the project, using actual cash flows, and makes projections for financial outcomes. We documented the yearly expenses and revenues (cash flows) for operating a small tropical woodlot, costs and/or revenues from the specific woodlot management operations, and profit projections over the 25-year life of the project. We used realized growth rates, milling costs, and wood sale prices to show that small-scale reforestation with mixtures of native species can be financially profitable, both for an investor and a farmer/landowner.

Keywords: Terminalia amazonia; farm forestry; financial analysis; tropical reforestation

Document Type: Research Article

Publication date: July 1, 2006

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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