The Environmental, Financial, and Aesthetic Benefits of Woodland Management
By Michael Bartlett, senior forester at Hull Forest Products.
Michael Bartlett is the recipient of the Society of American Foresters “Outstanding Practicing Professional Forester for New England” award. An expert in environmentally sound forest harvesting practices, Mike has worked in forest resource management for over 20 years and brings a wealth of experience to forest landowners.
Financial analysts know timberland is a great portfolio diversifier that has historically outpaced inflation while offering a low risk. Many people invest in timber stocks or funds such as TIMOs or REITs for these reasons. But did you know that your personal forestland, when properly managed, becomes a valuable long-term investment? Managed forestland can generate periodic income while at the same time providing a beautiful wooded space for humans and wildlife to enjoy.
How Woodland Management Pays
If your woodland is not currently under active management, you are missing an opportunity to generate income from your forest. The following are a few examples of how forest management has provided a return for some of our clients. In each case, one of our foresters analyzed the client’s land and drafted a detailed forest management plan consistent with the client’s goals. The forester then focused the treatment, or thinning, on removing trees of poor form, health, or quality. The strategy was to improve the growing conditions for the better quality trees during each treatment. By managing the forest in this way, future annual growth is accelerated and concentrated on the better quality trees, which improve in value at a considerably better rate than poor quality trees. As a result, there are fewer losses due to insects and disease because healthy trees, which have been given growing space to maintain or improve their growth, are better able to withstand such occurrences.
Examples of Actively Managed Forests
Client A has a 103-acre parcel, of which 70 acres have been actively managed in the form of thinning. Several selective timber harvests have been conducted over the years, keeping the forest healthy and producing income for the client. In 1982, when Hull Forest Products began managing the land, the total value of the standing timber on the 70 acres was $33,000. A treatment in 1982 produced $9,296 in income. This left a residual value of $23,704 in the timber left standing. In 1992 another thinning produced $13,676 in income. In 2004 another treatment produced $20,575 for the client. The total income produced over 22 years is $43,520, and the value of the trees still standing following the 2004 harvest has increased to $45,000.
|Year||Value of the Forest’s Standing Timber||Income Selective Harvest|
|$43,520 total timber income so far|
As you can see from the table above, selective timber harvesting has not only increased the value of the timber that remains in the client’s forest, it has also provided a greater income stream over time due to the improved quality of the timber remaining after each harvest.
If the income from each harvest had been invested and earned a conservative annual rate of 4 percent since 1982, the total income produced would be $63,655. Including the value of the timber in the residual stand, the $33,000 in timber value from 1982 has grown to $108,655, an annual increase of approximately 6 percent in value.
Client B has a 51-acre parcel. Hull Forest Products began managing 43 of the 51 acres in 1986. The first harvest in 1986 produced an income of $14,162. Another treatment in 1997 produced $11,890. A third harvest was done in 2004, producing $11,252 for the landowner. The residual standing timber in 2004 has a value of $10,000. The total income produced over 18 years is $37,303.
Client C has 1,130 acres. Approximately 800 acres are under active forest management. Hull Forest Products began managing the 800 acres in 1978. Since 1978, 1.3 million board feet and 1,948 cords of firewood have been harvested. The landowner has received $161,615 in income from the timber harvesting, and there are over 2 million board feet of timber still standing at present, with an estimated value of over $400,000.Financial, Environmental, and Recreational Forest Values
In each of the above cases, forest management has provided income for our clients and it has greatly improved their relationship with their property.
Our clients report that they spend more time in their managed woods and that the quality of that time is improved. One client rarely walked his property because it was so overgrown with briars, but now he enjoys hiking the newly created trails and picnicking in a small open meadow-like area with a view of the pond. Due to the wildlife clearing and the seeding of conservation mix, deer are now frequent visitors to this area, too. Improving wildlife habitat and opening up a vista and creating walking paths were all part of his management goals and they were accomplished in conjunction with a timber harvest.
In addition to providing periodic income, our clients’ forests are doing all of the amazing things that forests do: they help make cleaner air, they sequester carbon, they protect water quality, they provide habitat for wildlife, and they are attractive green spaces that do a favor to the entire community by costing local governments less than the same land would if it were developed.
By managing for timber as well as other values such as recreation, wildlife, water, and aesthetics, our foresters can produce significant income for clients from timber sales, while at the same time enhancing or protecting the other values the forests hold.
For more information on forest management, or to request a free appraisal of your forest, please contact us. We look forward to enhancing the value and beauty of your forest.