private working forests: recent trends and economic impact
TRANSCRIPT
©2016, Forest2Market, Inc.
PRIVATE WORKING FORESTS: RECENT TRENDS AND ECONOMIC IMPACT
HANNAH M. JEFFERIESTIMBER AND FIBER MARKET ANALYST
JUNE 28, 2016
©2016, Forest2Market, Inc.Slide 2
FOREST2MARKETINTRODUCTION
Forest2Market serves industries that consume wood raw materials:• Wood products, pulp and paper
products and lumber manufacturers
• Bioenergy, biofuels and biochemical
producers
Forest2Market is a neutral third-party, independent in ownership and structure. While actively involved in the industries we serve,
we do not buy or sell timberland, timber, lumber or biomass.
©2016, Forest2Market, Inc.Slide 3
THE SUSTAINING EFFECTS OF FOREST PRODUCT
DEMAND
Robust, long-term demand for forest products promotes investment in forested lands and ensures that they remain forested.
©2016, Forest2Market, Inc.Slide 4
FORESTED LAND IN THE UNITED STATES
Forest2Market conducted two analyses for NAFO:• United States Forest Inventory and Harvest Trends on
Privately-Owned Timberlands, 2016• The Economic Impact of Privately-Owned Forests in the
United States, 2016
Economic Impact Regions
Inventory/Removal Regions
©2016, Forest2Market, Inc.Slide 5
NATIONAL TRENDS IN INVENTORY AND
REMOVALS
Total Removals Relative to Inventory, 2008-2014 – United States
Year Inventory Removals2008 257.5 6.992009 261.2 6.442010 264.8 6.732011 268.5 6.862012 272.1 6.732013 275.5 6.732014 279.7 6.68
Annual change 1.4% -0.8%
Year Inventory Removals2008 136.1 3.462009 136.2 3.452010 136.3 3.512011 136.9 3.572012 137.3 3.492013 137.6 3.442014 138.3 3.43
Annual change 0.3% -0.1%
All Species Sawtimber
All Species Pulpwood
• Removals are small in comparison to total available inventory.• Removals, especially sawtimber, have declined since 2008. • Inventory has increased steadily.
©2016, Forest2Market, Inc.Slide 6
NATIONAL TRENDS IN INVENTORY AND
REMOVALS
• Private landowners grow more wood than they harvest.
• Annually, growth has exceeded removals by an average of 40% (GRR=1.4).
• Net growth has increased since 2008.
Growth and Removals, 2008-2014 – United States
©2016, Forest2Market, Inc.Slide 7
Working forests support forestry, logging, lumber, paper, furniture, millwork, and wholesaling.
ECONOMIC CONTRIBUTION OF
WORKING FORESTS
Image credits: Forest2Market, Hannah Jefferies, group2runner, Fletcher6, Hannah Jefferies.
2.4M of 2.7M Jobs from Private Forests $99B of $113B Payroll from Private Forests
©2016, Forest2Market, Inc.Slide 8
ECONOMIC CONTRIBUTION OF
WORKING FORESTS
• Forest products manufacturing is 5.3% of total manufacturing GDP.
• In seven states, forest products manufacturing represents over 10% of total manufacturing GDP.
GDP (Billions $) Associated with Forest Products Manufacturing and Percent of Manufacturing GDP – 2014
©2016, Forest2Market, Inc.Slide 9
RECESSION IMPACTS: U.S. SOUTH EXAMPLE
• The Great Recession has disrupted typical harvest patterns, leading to an accumulation of inventory.
• Underutilized working forests are at risk of conversion to other uses, such as agriculture or development.
Total Inventory and Inventory Change, 2000-2014 – U.S. South
©2016, Forest2Market, Inc.
CONCLUSION
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• Demand from wood-consuming industries encourages landowners to maintain healthy and productive working forests.
• Working forests and the industries that rely on them for raw material inputs are critical to local economies, especially in rural areas.
• Declining demand places working forests at risk of conversion to other land uses that lack the benefits of working forests.
©2016, Forest2Market, Inc.
CONTACT AND MORE INFORMATION
Hannah M. JefferiesTimber and Fiber Market [email protected]
Forest2Market, Inc.15720 Brixham Hill AveSuite 550Charlotte, NC 28277
Forest2Market, Inc. 2016. United States Forest Inventory and Harvest Trends on Privately-Owned Timberlands. Charlotte, NC. Accessible at http://www.nafoalliance.org/images/issues/carbon/resources/F2M-inventory-harvest-trends-20160620.pdf
Forest2Market, Inc. 2016. The Economic Impact of Privately-Owned Forests in the United States. Charlotte, NC. Accessible at http://www.nafoalliance.org/images/documents/task-groups/communications/Forest2Market_Economic_Impact_of_Privately-Owned_Forests_April_2016.pdf
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©2016, Forest2Market, Inc.Slide 12
TERMINOLOGY
• Timberland: Forest capable of producing 20 cubic feet of wood per acre annually at culmination of mean annual increment. Excludes reserved forestland.
• Private Owner: Non-industrial private forest (NIPF) landowners, corporate entities (TIMOs, REITs, and integrated forest products companies), Native Americans, NGOs and unincorporated local partnerships, associations or clubs
• Inventory: Volume of growing-stock trees • Removals: Volume of trees that have been removed since the previous inventory.
Includes cut and utilized trees, cut and unutilized trees, and live trees associated with land-use reclassifications.
• Growth: • GRR: Growth-to-Removal Ratio
• Direct Effect: Jobs and payroll at forestry-related businesses.• Indirect Effect: Jobs and payroll at businesses that supply inputs to forestry-
related businesses. • Induced Effect: Jobs and payroll that are supported by direct and indirect
industries through consumer spending.• GDP: The gross output of an industry less its intermediate inputs.