Anssi Niskanen

The financial and economic profitability of field afforestation in Finland

Niskanen A. (1999). The financial and economic profitability of field afforestation in Finland. Silva Fennica vol. 33 no. 2 article id 664. https://doi.org/10.14214/sf.664

Abstract

The aim of the study was to assess the rate of return on invested capital and soil expectation value in field afforestation from the financial (business economic) and economic (national economic) point of views in Finland using 1996 cost and price data. Risks for renewal planting and negative growth impacts of reduction in plantation density were explicitly included in the profitability assessments. Results indicated that due to the subsidies and favorable regulations for obtaining them in 1996, field afforestation was financially profitable for farmers regardless of what species was used for planting. From the national economic point of view, investments in field afforestation provided only substantial return on invested capital, being highest after risk adjustments in Norway spruce (Picea abies) plantations.

Keywords
plantation; efficiency; cost-benefit-analysis; net-present-value

Received 1 July 1998 Accepted 11 March 1999 Published 31 December 1999

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