Economic analysis and simulation of the impact of thinning on wood production in Järvselja Training and Experimental Forest Centre

The results of the analysis of profitability and impact of thinning on wood production in Järvselja Training and Experimental Forest Centre are presented in the article. The profitability was assessed on the basis of harvesting income and costs of logging operations in 2015–2017. The impact of thinning on the wood production was assessed using the MOTTI simulation program. Three different scenarios for the management of the stand were compared: 1) stand management in accordance with the Finnish forest management recommendations (Tapio recommendations), 2) management according to the Estonian Forest Management Regulations and 3) stand development without thinning. The results revealed that 61 thinnings out of the 70 were profitable. The average net income from thinning was 344 euros per hectare. Fuel wood accounted for 45% and pulpwood for 30% of the harvested timber. Net present value was applied as a criterion to assess the profitability of long-term management scenarios. Considering Tapio's recommendations, the total net present value was 33% higher and following Estonian forest management rules, it was 23% higher compared to the simulations without thinning. The results indicated that thinning is economically viable in the long run. In simulations without thinning, timber production is the highest, but the net present value of management is lower compared to simulations with thinning.