Forest Asset Option Pricing With Carbon Costs And Benefits Considered

Forestry is the important fundamental industry in our country, its resources are valuable assets to the survival of humans, but its value is often underestimated badly. In China, unreasonable forest resources utilization and forest ecosystem destruction has become a common phenomenon. Therefore, it is very necessary that correctly understanding and reasonably estimating the value of forest and forest land. Based on the "uncertainty" and "management flexibility" of forestry investment project, this paper will study on forest asset pricing which considers carbon costs and benefits. According to the real option theory, combined with China’s forestry policy and forest asset characteristics, this paper prices forest resources with carbon costs and benefits considered, to meet the requirements of the scientific evaluation of forestry investment project value.Through the review of related literature at home and abroad, this paper summarizes the research status of the forestry resource pricing in our country, and introduces real option theory on the basis of pointing out the shortages of the traditional evaluation method. Through analyzing the characteristics of forestry investment project, it describes the advancement and the necessity of the real option theory applied to forest assets evaluation. Secondly, this paper discusses the content of the investment and decision-making for forestry project, analyses the life cycle characteristics of forestry investment project, summarizes the type of real options contained in different stages, introduces carbon costs and benefits into the evaluation system, and constructs the forest assets evaluation model based on BROA. Finally, in order to combining theoretical research with practical application, this article also makes a empirical analysis on the project to promote the fast-growing and high-yield technology in Jing de County, Guangxi. Through result comparison on different methods, verifying the feasibility of our evaluation method, and providing an important reference for scientific investment decision-making of forestry projects and forest asset management.