Economics of harvesting boreal uneven-aged mixed-species forests

The subject of this study is the economics of harvesting boreal uneven-aged mixed-species forests consisting of Norway spruce (Picea abies (L.) Karst.), Scots pine (Pinus sylvestris L.), birch (Betula pendula Roth and B. pubescens Ehrh.), and other broadleaves. The analysis is based on an economic description of uneven-aged forestry, applying a size-structured model. The optimization problem is solved in its general dynamic form using gradient-based interior point methods. When volume yield is maximized, the optimal steady state is a nearly pure Norway spruce stand at all site types, producing slightly higher yields than single-species stands. After including sawlog and pulpwood prices, the net present value of stumpage revenues is maximized using 1%, 3%, and 5% interest rates and a 15-year harvesting interval. At less productive sites, the stands are nearly pure Norway spruce stands, regardless of the interest rate. At more productive sites, increasing the interest rate increases the species diversity, with optimal steady states consisting of both Norway spruce and birch. In some cases, rather small changes in relative prices change the optimal steady state into a birch-dominated stand. Optimal solutions converge to the same steady-state solutions, independent of the initial stand state. If other broadleaves without commercial value are not harvested, they will eventually dominate the stand.