| Environmental concerns over rising greenhouse gas emissions are escalating, especially over carbon dioxide (CO2). Although the United States did not adopt the Kyoto protocols, efforts are still being made to reduce national emissions. One option to meet the reduction goals is through carbon sequestration on abandoned pastures and unused agricultural lands. Carbon emitting companies would then be able to purchase carbon credits (1 credit = 1 ton of carbon) from those sequestering carbon to mitigate their CO 2 emissions.; This study determined the financially optimal management regimes for quaking aspen, red pine, and sugar maple planted on lands in the Lake States region of the United States. FORMOP, a stand growth and economic analysis program, was used to predict growth, yield, and financial returns from stand establishment to final harvest. This iterative program used five year average stumpage prices, management costs, and real price and cost increases to perform the financial analysis. Other inputs included site indices 50 -- 70 for red pine, and 70 -- 90 for quaking aspen and sugar maple, 0 or 1 thinnings were possible for quaking aspen and 0,1, or 2 thinnings were possible for red pine and sugar maple. Thinning intensities of 20, 25, or 30 percent of basal area removed were considered along with carbon values per ton of {dollar}0, {dollar}10, {dollar}37, and {dollar}50. Quaking aspen rotations were limited to a maximum of 60 years, red pine to 80 years, and sugar maple to 90 years. Real alternative rates of return (ARR) of 2.5 to 15.0 percent were considered. Soil expectation values were utilized to select the financially optimal thinning and final harvest schedules. Results indicate that when carbon equals {dollar}0 artificially regenerated quaking aspen stands generate lower returns than the landowners alternative investment options. However, as carbon price per ton increases to {dollar}37, SEVs become positive when compared to both the 2.5 and 5.0 percent ARR. Both red pine and sugar maple demonstrated positive SEVs at 2.5% ARR when carbon value equaled {dollar}0. At a {dollar}50 carbon value the two higher site indices (SI 60 and 70 for red pine, and SI 80 and 90 for sugar maple) showed positive SEVs at 12.5% ARR. Based on these results, it is possible that at high carbon values even marginal lands with low site indices could be profitably managed, especially if the landowners ARR is fairly low. |
