General
The objective is to maximize the present value of harvesting in different
stands at a forest property.
This analysis is based on the assumption that all relevant future conditions,
such as prices, costs, growth etc. are perfectly known. Of course, this
is not generally true. In any case, the results may serve as an illustration
of the rational decisions in case such information would be available.
Other software created by the same author can handle situations when conditions
randomly change over time and sequential decisions are made based on the
latest developments.
How to use this software:
1. First, the user creates a text file (a stand data list) using some standard text editor, such as Wordpad.
One example of such a stand data list is available if you, from the
main page, click on "Stand data list (sample file)".
The data found in the stand data list is the following:
| n | Stand number |
| V0 | Volume per hectare right now (when t = 0). The usual unit is cubic
metre per hectare but any unit can be used as long as the same unit is
found everywhere in the list.
Example from Sweden: m3sk/hectare |
| V1 | Volume growth per hectare and year (during each year until the final
harvest takes place). Units: Compare V0.
Example from Sweden: m3sk/hectare/year |
| P0 | Net price per volume unit right now (when t = 0). This is the price
of the timber (including pulpwood, fuelwood etc) subtracted by the relevant
costs per volume unit. These costs may include different things in different
countries and regions.
Example from Sweden: SEK/m3sk |
| P1 | The growth of the net price per volume unit and year (during each year
until the final harvest takes place). Units: Compare P0.
Example from Sweden: SEK/m3sk/year |
| L | Land value per hectare (of the bare land after the final harvest). Example from Sweden: SEK/hectare |
| A | Area of the stand. Example from Sweden: hectares |
| Y0 | The first year when harvesting of the stand is possible (because of constraints in the forest act or other reasons specified by the user.) |
| Ymax | The last year when harvesting of the stand is possible (because of constraints in the forest act or other reasons specified by the user.) |
2. The user inputs the number of stands in the first box. (Example: 5)
3. The user inputs the rate of interest in the capital market (Example: 3). Note that the rate of interest is defined in the unit % and that all calculations within the software are based on discounting in continuous time. Hence, the discount factor is EXP(-r/100*t) when r is the rate of interest and t is the number of years until some cost or revenue occurs.
4. The user should use the commands "copy" and "paste" in order to move the stand data list from the editor (or from the sample file) to the stand data list window in the ASPFau1 software. Note: It is very important that the format of the stand data list exactly corresponds to the format of the sample stand data list. Exactly the same number of positions etc. have to be used. There should be no empty spaces or similar deviations from the sample file format. The present version of the software is constrained to a maximum of 20 stands. Most private forest owners have less than 20 stands available. Larger versions of the software can easily be constructed but then the costs of calculations may increase. Such costs have to be covered by the user in one way or another. The present software version can be used for free.
5. The ASP-software ASPFau1 maximizes the present value when the user presses the button "Optimize!". The optimal harvest years and the optimal present values per hectare for each stand are printed. The total present value of all stands is also reported.
The user should be aware that, in some countries, special kinds of restrictions
in forest acts, influence the structure of the decision problem. In such
cases, the user is suggested to consult the author of this software. Special
solution methods may then be needed in order to optimize the total present
value of the forest property.
An example:
Please look at the stand data list (sample file).
The first stand presently contains 150 cubic metres per hectare (=V0).
The growth is 3.8 cubic metres per hectare and year (= V1). (Note that the unit in the table is 0.1 cubic metres for V1.)
If you harvest the stand right now, you get a net price per cubic metre of 190 SEK (= P0).
Each year, the net price per cubic metre increases by 2.0 SEK ( = P1). (Note that the unit in the table is 0.1 SEK per cubic metre and year for P1.)
The value of the bare land is 2000 SEK/hectare. (Note that the unit in the table is 1000 SEK for L.)
The area of the stand is 10 hectares (= A).
You are allowed to harvest the stand no earlier than ten years from now (= Y0) and no later than sixty years from now (=Ymax).
In case you use the rate of intrerest "3" and the number of stands "5" and input the Stand data list (sample file), then you will find that the optimal harvest year of stand 1 is 10 years from now. The present value per hectare will be 30729 SEK in this stand. The different stands will have different optimal harvest ages and present values per hectare. If the rate of interest changes, the results also change.
The total optimal present value of all stands is 1, 495, 450 SEK.