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Forest Sector ModelingState of the Art: Asia
Forest Sector Modeling Conference in Seattle 2008
Hiroyasu Oka and Satoshi TachibanaForestry and Forest Products Research y
Institute, Japan
Development of Forest SectorDevelopment of Forest Sector Models in Asia
JapanChinaRepublic of KoreaOthers
JapanFFPRI published a book on forest sector modeling and outlook in Dec. 2006. (in Japanese) M d li i l i l b l f d kModeling in relation to global forest products market.Forest products demand model.F d lForest resources model.Forest work force model.F t l b d ti it d lForest labor productivity model.Forest management labor demand model.Forested villages population modelForested villages population model.
Development of world forestDevelopment of world forest products modelWe are updating World Forest Products Model (WFPM) to estimate trends and prospects of the world forest
d f d k resources and forest products market. WFPM is an integrated forest sector model which covers forest resources roundwood production forest resources, roundwood production, manufacturing, international trade, and consumption of forest products in major countries and regions of the world.WFPM owes a lot on earlier studies of the GTM and GFPM ll h W ld F d M d l GFPM as well as the World Food Model.
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F f h M d l (1)Feature of the Model (1)
l l b d lPartial equilibrium model by which only the forest and forest products market are targeted. Multi commodity model by which market clearing Multi commodity model by which market clearing prices of multi commodity that relates with each other are determined simultaneously. Multi‐regional world model by which the entire Multi regional world model by which the entire world is divided into regions and trade of all regions is determined simultaneously. Non‐spatial model by which differences such as the Non spatial model by which differences such as the transportation expense between various places and preference as trade partner are not considered.
F f h M d l (2)Feature of the Model (2)Net trade model: The amount of import and amount Net trade model: The amount of import and amount of export are not calculated separately.Model with nonlinear simultaneous equations( i l i l i i f i l f i ) b (mainly using elasticity of exponential function) by which approximation solution are obtained. Dynamic model to simulate change over time by using l d bllagged variables. Integrated model: Estimates of some parameters are done outside of the model. Policy simulation model: The effects of change in policy such as re‐afforestation rates are analyzed.
Modeling of Forest Resources and LogModeling of Forest Resources and Log ProductionThe stock change in the forest brings the change in log supply
potential. The stock change is determined by:S k h F A *MAI( l l d)Stock change=Forest Area*MAI(natural, planted)
‐Initial stock*Disaster damage rate‐Log production*Volume impact factor
( )(Industrial roundwood, Woodfuels)For the countries without annual increment data, we tentatively
assumed;l d (%)l d (%)0 ≤ Annual damage rate (%)0 ≤ Annual damage rate (%) ≤ 5≤ 5
1 ≤ MAI(natural and protective forests)1 ≤ MAI(natural and protective forests)≤ 5 (m3/ha/yr)≤ 5 (m3/ha/yr)1.251.25 ≤ ≤ Impact factor(industrial roundwood)Impact factor(industrial roundwood) ≤5≤5 (m3/m3)(m3/m3)55 p f ( )p f ( ) 55 ( 3 3)( 3 3)00 ≤≤ Impact factor(Impact factor(woodfuelswoodfuels) ) ≤ 1 (m3/m3)≤ 1 (m3/m3)
Results of estimation on regional stock change relations: Africa and Asia
3 504.00
Africa (m3/ha/yr)
4 004.50 5.00
Asia (m3/ha/yr)
0 501.00 1.50 2.00 2.50 3.00 3.50
Max 1.00 1.50 2.00 2.50 3.00 3.50 4.00
MaxMin
-0.50 0.00 0.50 Min
-0.50 0.00 0.50 Min
• Annual stock change from 1990 to 2000, estimated MAI, volume of logging impact and damaged volume for major
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volume of logging impact, and damaged volume for major regions of the world.
l f l k hResults of estimation on regional stock change relations: Europe and Russia
1.20
Russia (m3/ha/yr)
5.00
6.00
Europe (ex Russia, m3/ha/yr)
0.40 0.60 0.80 1.00
Max2.00
3.00
4.00
Max
0.00 0.20 Min
0.00
1.00 Min
• Annual stock change from 1990 to 2000, estimated MAI, l f l i i t d d d l f j
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volume of logging impact, and damaged volume for major regions of the world.
l f l k hResults of estimation on regional stock change relations: Americas
3.50 4.00
Latin America (m3/ha/yr)
1 601.80 2.00
North America (m3/ha/yr)
1 001.50 2.00 2.50 3.00
Max0 600.80 1.00 1.20 1.40 1.60
Max
-0.50 0.00 0.50 1.00 Min
0.00 0.20 0.40 0.60
Min
• Annual stock change from 1990 to 2000, estimated MAI,
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g , ,volume of logging impact, and damaged volume for major regions of the world.
l f l k hResults of estimation on regional stock change relations: Oceania and the World
0.70 0.80 0.90 1.00
Oceania (m3/ha/yr)
3.50
4.00
World (m3/ha/yr)
0.10 0.20 0.30 0.40 0.50 0.60
MaxMin
2.00
2.50
3.00
MaxMin0.00
0.00
0.50
1.00
1.50 Min
• Annual stock change from 1990 to 2000, estimated MAI volume of logging impacts and
-0.50 Annual increment
Logging impact
Disaster damage
Stock change
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estimated MAI, volume of logging impacts, and damaged volume of world average.
Discussion on the stock changeDiscussion on the stock change relations by major regionsy j g
In the North America and Europe except Russia, large proportion of annual increment is felled by logging, while growing stock is increasing.In Africa Asia and in Latin America larger volume In Africa, Asia and in Latin America, larger volume might be damaged by disasters than by logging impacts, and resulted in decrease of growing stock.p , g g
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Modeling of DemandThe demand for the forest products expand by The demand for the forest products expand by economic growth. The amount of industrial roundwood demand The amount of industrial roundwood demand to produce products is determined by the amount of output of the product (except for
l d ) pulp and paper). The amount of supply and demand of the woodfuel is determined by the change in woodfuel is determined by the change in population and the resource stock.
Sawnwood
Resource Roundwood,Material Supply
Plywood
B d
World Demandand Supply, World Pricepp y Board
Pulp & PaperPulp & Paper
Relationship of Blocks
ProductionHazard
t-1
Forest StockProductionPotential
c
Hazard(Survival Rate)
Annual Increment FuelwoodProduction t-1 Population
c cPlantation c
Planted ForestArea
Natural ForestArea
RoundwoodProduction t-1
c c
c
Forest Resource Block to (from)Other Block
Roundwood Supplyfor Sawnwood
Roundwood Roundwood
Tariff for SawnwoodRelative Priceof Roundwoodfor Sawnwood
ProductionPotential Roundwood Supply
for PlywoodRoundwood
Domestic Price
World Pricee
RoundwoodDemand
RoundwoodProduction
for Plywood
Roundwood Supplyfor Board
Relative Priceof Roundwood
for Plywood
Domestic Pricee e
e
RoundwoodNet Trade
for Board
Roundwood Supplyfor Pulp
Relative Priceof Roundwood
for Board
R l i P i
e
Other Ind.RndwdDemand
Relative Priceof Roundwood
for PulpGDP
e e
Roundwood Supply Block
S d SawnwoodSawnwoodTariff World Price
SawnwoodDomestic Price e
Roundwood Supplyfor Sawnwood
SawnwoodProduction
SawnwoodDemand
SawnwoodNet Trade
Sawnwood to RoundwoodI/O coefficient
GDPec
Sawnwood Block (same for Plywood and Board Block)
PulpTariff
PulpWorld Price
PulpD d
PulpP d ti
RoundwoodS l f P l
Tariff
PulpDomestic Price
World Price
Pulp to PaperFraction
ePulp
Net Trade
DemandProductionSupply for Pulpc
c
PP
Pulp to RoundwoodI/O coefficient Paper
TariffPaperDomestic Price
PaperWorld Price
ee
e
PaperDemand
PaperNet Trade
PaperProduction
Domestic Price e
e
GDPPulp & Paper Block
Model Equations(for Each Year) ORDER ITEM VARIABLE UNIT EQUATION (NOTICE: X_1 ≡ X at t-1) PARAMETER
Predetermined 1 GDP USD YY = YY_1*(1+#1) #1: GDP growth rateVariables 2 Natural Forest Area ha FN = FN_1-RWSS_1*FI_1*#1 #1: initial coefficient_ _ _
| 3 Planted Forest Area ha FP = FP_1+#1 #1: Annual Change in Planted Forest Area (ha)
| 4 Annual Growth of Forest Stock m3/yr RG = FN_1*#1+FP_1*#2 #1: Annual Growth of Natural Forest (m3/ha/yr)#2: Annual Growth of Planted Forest (m3/ha/yr)
V
5 Forest Stock m3 RS = RS_1*#3+(RG-RWMS_1*#1-RWSS_1*#2)#1: Harvest Impact Factor of Fuelwood (ha/m3)#2: Harvest Impact Factor of Industrial Roundwood (ha/m3)#3: Survival Rate (from Hazard)
6 Area Impact Factor of Natural Forest FI = FI_1*FN/FN_1*RS_1/RS
7 PA Ratio of Wood Pulp consumption to Paper production MS = MS_1+#1 #1: Annual Change of the fraction#1: Forest Stock Elasticity (=0 0 or 0 5 or 1 0)8 RW Demand for Fuelwood m3 MS = PO*RS^#1*c0 #1: Forest Stock Elasticity (=0.0 or 0.5 or 1.0)PO: Poplulation
9 RW Demand for Other Industrial Roundwood m3 MM = YY^#1*RS^#2*c0 #1: GDP Elasticity#2: Forest Stock Elasticity (=0.5 or 1.0 or 2.0)
WHILE (until conversion) { FOR Item(PA,PU,BD,PN,SW,RW) { WHILE ( |ΣNE| >0) {
| 10 all Trade Price USD PT = PW+MG PW: World Price MG: PW minus PT (fixed value)| 11 all [EXPORTER] Domestic Price USD PD = PT| [IMPORTER] Domestic Price PD = PT*(1+TR) TR: Tarrif RateV 12 RW P d ti f I d t i l R d d SS PD^#1*RS^#2* 0 #1 P i El ti itV 12 RW Production of Industrial Roundwood m3 SS = PD^#1*RS^#2*c0 #1: Price Elasticity
[JP] (Production of Industrial Roundwood) SS = PK^#1*RS^#2*c0 #2: Forest Stock Elasticity (=0.5 or 1.0 or 2.0)13 SW,PN,BD,PU Industrial Roundwood Allocated to Products m3 or MT MM = RWDD_1*(PD/RWPD)^#1*c0 #1: Relative Price Elasticity
[JP] (Domestic Industrial Roundwood) MK = RWDK_1*(PD/RWPK)^#1*c0
(Imported Industrial Roundwood) MZ = RWDZ_1*(PD/RWPD)^#1*c0MM = MK+MZ
14 SW,PN,BD,PU Producttion of Forest Products m3 or MT SS = MM/#1 #1: I/O coefficient (Products Production / Roundwood Consumption)
15 PA Production of Paper MT SS = PD^#1*PUPD^#2*c0 #1: Price Elasticity #2: Elasticity to Pulp Price15 PA Production of Paper MT SS = PD^#1*PUPD^#2*c0 #1: Price Elasticity #2: Elasticity to Pulp Price16 SW,PN,BD,PA Demand for Forest Products m3 or MT DD = YY^#1*PD^#2*c0 #1: GDP Elasticity #2: Price Elasticity17 PU Demand for Pulp MT DD = PASS*PAMS
18 RW Demand for Industrial Roundwood m3 DD = RWMM+SWMM+PNMM+BDMM+PUMM
[JP] (Demand for Domestic Industrial Roundwood) DK = RWMM+SWMK+PNMK+BDMK+PUMK
[JP] (Demand for Imported Industrial Roundwood) DZ = SWMZ+PNMZ+BDMZ+PUMZ
19 all Net Export m3 or MT NE = SS-DD
20 RW [JP] [JP] (Domestic Price of Industrial Roundwood) USD PK <--- PK at RWSS = RWDK
21 all World Price USD PW <--- minimize |ΣNE| } } }
Major difference with GFPM and GTMMajor difference with GFPM and GTMAllocation of IndRoundwood to end products.MM RWDD (PD / RWPD )αMMi jMMi,j,t = RWDDj,t‐1 .(PDi,j,t / RWPDj,t )
αMMi,j .cMMi,j
RWDDj,t : Total Demand for IndRndwdPDi,j,t : Products Price RWPDj,t : IndRndwd Priceα MMi,j : Relative Price Elasticity cMMi,j : constant
This system of equations model include elasticity of log supply for This system of equations model include elasticity of log supply for end products with respect to relative price of products to the price of logs.
It is often difficult to estimate this relative price elasticity with expected sign and statistical significance. This difficulty is comparable to the difficulty in determining regional difference comparable to the difficulty in determining regional difference in the expansion of manufacturing capacity in the GFPM.
World models are;Useful in estimating the potential of timber and other fiber supply
d l f d d d h l b l and long‐term forest products demand at the global level.But not yet sophisticated enough to estimate future But not yet sophisticated enough to estimate future equilibrium price and competitive power of industries in each country so far. y
f f dAsia specific findingsDemand for woodpulp in China is rapidly increasing as a Demand for woodpulp in China is rapidly increasing as a result of increase in paper production. Apparent consumption of woodpulp per unit amount of paper production had also increased substantially from 0 14 in production had also increased substantially from 0.14 in 1996 to 0.27 in 2001, and then have gradually decreased to 0.22 in 2006. (Input of non‐wood fiber pulp per unit amount of paper production has been substantiall amount of paper production has been substantially decreasing and input of recovered paper has been rapidly increasing in the same period. See the next slide.)
d d dlForest products consumption per capita in India is rapidly increasing but is still quite small compared to other countries. It was about 1/5 of world average for lumber and
( )less than 1/10 for paper in 2005 (calculated from FAOSTAT).
ton/ton
Input of Materials for Paper and Paper Board Production in China (based on FAOSTAT Feb.2008)
0.80
1.00
0.60 Woodpulp/Paper
0.20
0.40 OtherFiber/PaperRecovered/Paper
0.00
1990 1992 1994 1996 1998 2000 2002 2004 20061990 1992 1994 1996 1998 2000 2002 2004 2006
Japan:pForest Products Demand Model
Forestry Agency have published forest sector outlook of Forestry Agency have published forest sector outlook of Japan several times since 1980sForest products demand model used by the Japanese government in the late 1980s and 1990s had wood government in the late 1980s and 1990s had wood processing capacity as a determinant of demand for logs. Increase of end products imports diminished the power of the model.About 80% of lumber is used for construction in Japan. Demand for lumber depend largely on floor area of housing starts, and the price elasticity of demand is low.g p yIncome elasticity of demand for paper used to be close to 1.0 but its demand seems to have stopped increasing recently in Japan as well as in some other high
i i ( h l d l )consumption countries. (see the slide coming later)
Trends in forest products consumptionTrends in forest products consumption in log equivalent
70
80Mln m3
50
60
70
Sawnwood
30
40
Sawnwood
Pulp
Plywood
10
20
01955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 Year
A i f d
140
Million ton
Apparent consumption of paper and paperboard by major regions
120
140
North America:
80
100 Asia:
Europe:
40
60China
Japan
0
20
Japan
1961
1964
1967
1970
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2003
Japan: Forest Resources andJapan: Forest Resources and Timber Supply Model
Timber supply model used by the Japanese government in the 1980s and 1990s based on the gentan probability model, which originally assumed that felling rates of the stands of which originally assumed that felling rates of the stands of each age class do not change over time (T. Suzuki).Gentan probability model was modified to allow for the change in commercial forest area depending on the level of timber price (M. Amano and I. Noda).Recent development in Forest Age Distribution Assessment Recent development in Forest Age Distribution Assessment System considers age class distribution or existing area of elder stands as an additional determinant of felling rate (H. Ok d H K b )Oka and H. Kuboyama ).
Trends and prospects of CryptomeriaTrends and prospects of Cryptomeriaplantations by age class
4 0
4.5
5.0Mln ha
2.5
3.0
3.5
4.061+
41-60
1.0
1.5
2.0 21-40
1-20
0.0
0.5
1970 1980 1990 2000 2010 2020 2030 Year
Rates of felling and planting are low, and the forest will become old.
Historical Industrial RoundwoodProduction in Japan
Estimated Industrial Roundwood Production
50
60 (Mm3)
40
20
30
Total
0
10
0
1901
1905
1909
1913
1917
1921
1925
1929
1933
1937
1941
1945
1949
1953
1957
1961
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
Japan:Japan:Forest Work Force Model
A large proportion of workers in forestry are aged and is going to retire in a decade or two.T d i h k f i f b lTrends in the work force in forestry by age class
250,000
150,000
200,000 65-
50-64
35-49
50,000
100,000 15-34
01970 1980 1990 2000 2010 2020 2030
Year
Japan:Japan:Labor Productivity Model
Improvement of labor productivity in forestry was slow in Japan. But it is improving recently and the
d h h i ill b l d bl d i trend show that it will be almost doubled in 20 years (H. Kanomata).I t f l b d ti it h b Improvement of labor productivity has been achieved by the development of forest roads and machines and by increased volume per tree and machines, and by increased volume per tree and per area.
Forest Management/Forest Management/Labor Demand ModelA system dynamics model has been developed to simulate the possible combinations of changes in i b d i k f d l b timber production, work force, and labor productivity (H. Noda).P d ti f ti b L i k f Production of timber = Logging work force
* Labor productivityD d f l i l b R l i Demand for replanting labor = Replanting area
* Labor productivity in planting
Japan:Japan:Forested Villages Population ModelSustainability of forest based communities is an important policy objective.p p y jResults of cohort analysis showed that forested village population in Japan forested village population in Japan decreases from 4.5 million in 2000 to 2.4‐3.5 million in 2030, which may have significant million in 2030, which may have significant impacts on forest management.
Prominent works in Republic of KoreaProminent works in Republic of Korea
Topics and Methodology in the field of FSMp gyEconometric studies on demand and supply of logs and wood products, and imports in Korea i 8since 1980sNational Forest Research Institute studies the trend and long‐term outlook for Korean forest trend and long term outlook for Korean forest sector (1998, 2007).The latest National Forest Program started in g2008 is the first national program of ROK based on the mathematical forest sector model.
Prominent works in ChinaProminent works in China
Topics and Methodology in the field of FSM Topics and Methodology in the field of FSM Timber consumption structure and forecasts.Research on timber demand and supply forecast Research on timber demand and supply forecast started in 1983Forest resource inventory based on systematic y ysampling has been published periodically.
Major challenges at present and in theMajor challenges at present and in the future FSM studies in Asia
Major research funds for forest sector models are related with global warming issues including carbon cycle and REDD and illegal logging issuescarbon cycle and REDD, and illegal logging issues.In many countries of Asia, statistics on forest resources and forest products are not reliable or
i t tnon‐existent.International coordination in forest sector study is weak in Asia, compared to Europe and Americas. , p pAdvancement of international coordination is necessary because the forest sector of the region is closely related and the relation is getting deeper closely related and the relation is getting deeper and deeper.