Parkside Gully Tolerant Hardwood Selection Harvest and Product Recovery Study Bill Cole, Elaine Mallory, Jeff Kokes, Jennie Pearce OMNR Ontario Forest Research Institute 30 April 2008

Cole/OFRI 2 Study Location

30 April 2008Cole/OFRI 3 Brief Project History  3 demonstration projects started in at Swan Lake  Two stands harvested (12 ha)  Two stands uncut (12 ha)  Harvests occurred in 1967, 1980, 1992, 2005  Data collection years:  1965, 1966, 1967, 1968, 1974, 1976, 1978, 1980, 1981, 1984, 1987, 1990, 1992, 1993, 1997, 2005, 2006 Harvest Uncut Harvest Uncut Hwy60 Tea Lake Lake Swan Swan Lake Forest Research Reserve

30 April 2008Cole/OFRI 4 Current Project Study objectives: Study objectives:  To compare growth rates and stem quality development in managed stands vs. uncut control stands over 40 years;  To compare managed and unmanaged stands after 40 years using two indicators: - downed coarse wood - understory vegetation composition;  To compare the quantity, quality and economic values of products generated from 2005 harvest to average regional yields from two perspectives: - forest land manager - forest products manufacturer.

30 April 2008Cole/OFRI 5 Methods We used lots of methods…including Measuring trees and stands before and after 2005 harvest Tallying and scaling logs during the December 2005 harvest Tracking all logs through the Huntsville sawmill Summarizing board grades and yield from the sawlogs

30 April 2008Cole/OFRI 6 Results

30 April 2008Cole/OFRI 7 Results 1967Harvest 10.6 m 2 /ha 1980Harvest 5.5 m 2 /ha 1992Harvest 4.6 m 2 /ha 2005Harvest 4.9 m 2 /ha GLSL & South. Residual BA target target 13 yr interval 12 yr interval North Shore Residual BA target

30 April 2008Cole/OFRI 8 Results Basal area growth, (m 2 /ha/yr) 1992 Basal area (m 2 /ha) Survivor growth Ingrowth Gross growth Mortality Net growth PG1 – harvest PG3 – control Parkside Gully - Average annual basal area growth

30 April 2008Cole/OFRI 9 Results Logging Damage Provincial logging damage standard: 85% of residual BA ( trees > 10 cm) free from major damage 85% of residual BA ( trees > 10 cm) free from major damage 90% of residual AGS trees free from major damage 90% of residual AGS trees free from major damage damage not concentrated in one size class damage not concentrated in one size class Parkside Gully logging damage (2005 winter harvest): 98.5% of residual basal area (trees > 10 cm dbh) free from major damage after 1992 harvest98.5% of residual basal area (trees > 10 cm dbh) free from major damage after 1992 harvest 97.8% of residual basal area free from major damage after 2005 harvest97.8% of residual basal area free from major damage after 2005 harvest Woods et al. (2007) found 90.6% residual basal area free from major damage in their sampled crown land standsWoods et al. (2007) found 90.6% residual basal area free from major damage in their sampled crown land stands

30 April 2008Cole/OFRI 10 Results Very little difference in observed patterns of species distribution in overstory or understoryVery little difference in observed patterns of species distribution in overstory or understory Uncut and harvested stand overstories were dominated by sugar maple and beech, with small amounts of yellow birch, hemlock, and white spruceUncut and harvested stand overstories were dominated by sugar maple and beech, with small amounts of yellow birch, hemlock, and white spruce Tree regeneration dominated by sugar maple and beechTree regeneration dominated by sugar maple and beech Scattered patches of yellow birch, white spruce, balsam fir and ironwood regeneration in bothScattered patches of yellow birch, white spruce, balsam fir and ironwood regeneration in both Shrub layer dominated by hobble bush and striped maple, with small amount of mountain maple and beaked hazelShrub layer dominated by hobble bush and striped maple, with small amount of mountain maple and beaked hazel Vegetation impacts after 40 years of single-tree selection management:

30 April 2008Cole/OFRI 11 Results HarvestedControl PG1SIPG3TMTP 1 Stand size (ha) Mean DBH (cm) Snags Downed wood Density (stems Snags or # pcs./ha) Snags/100 live trees Downed wood Basal area (m 2 /ha) Live trees Live trees ≥ 60cm DBH Snags Volume (m 3 /ha) Downed wood Mean decay class Snag Downed wood year management impacts on snags and downed coarse wood

30 April 2008Cole/OFRI 12 Methods Parkside Gully Study assumptions and calculations Tonnes harvested and transported to Huntsville-Tembec mill (44.4 tonnes/ha)Tonnes harvested and transported to Huntsville-Tembec mill (44.4 tonnes/ha) Calculate gross revenue for logs harvested using 2005 log prices ($)Calculate gross revenue for logs harvested using 2005 log prices ($) Summarize total gross logging costs ($)Summarize total gross logging costs ($) Calculate total gross logging cost ($/tonne)Calculate total gross logging cost ($/tonne) Calculate total 2005 net log revenue (gross revenue – gross logging cost) ($)Calculate total 2005 net log revenue (gross revenue – gross logging cost) ($) Calculate net revenue per ha harvested ($/ha)Calculate net revenue per ha harvested ($/ha) Economic analysis – Forest manager

30 April 2008Cole/OFRI 13 Results 2005 Parkside Gully Harvest (observed) %tonnes%tonnes% tonne s 2005 $/tonne Gross revenue Total volume to mill (tonnes) Hardwood volume Hardwood sawlogs Hard maple logs $ 99 $ 99 $ 36,678 $ 36,678 Soft maple logs $ 50 $ 50 $ 52 $ 52 Beech logs $ 45 $ 45 $ 1,503 $ 1,503 Yellow birch logs $ 60 $ 60 $ 42 $ 42 Hardwood pulp $ 30 $ 30 $ 4,041 $ 4,041 Softwood volume 0 Economic analysis – Forest manager

30 April 2008Cole/OFRI 14 Methods Bush run assumptions and calculations Average tonnes harvested from recent operations (50 tonnes/ha)Average tonnes harvested from recent operations (50 tonnes/ha) Multiply by Parkside Gully harvest area for comparable expected tonnes harvestedMultiply by Parkside Gully harvest area for comparable expected tonnes harvested Calculate expected log yield by species and log grade using average bush run data and expected tonnes harvestedCalculate expected log yield by species and log grade using average bush run data and expected tonnes harvested Calculate expected bush run gross revenue using estimated yield and 2005 log prices ($)Calculate expected bush run gross revenue using estimated yield and 2005 log prices ($) Calculate expected gross logging costs using average costs and expected tonnes harvested ($/tonne)Calculate expected gross logging costs using average costs and expected tonnes harvested ($/tonne) Calculate expected net revenue for 2005 bush run harvest ($)Calculate expected net revenue for 2005 bush run harvest ($) Calculate expected net revenue per ha harvested ($/ha)Calculate expected net revenue per ha harvested ($/ha) Economic analysis – Forest manager

30 April 2008Cole/OFRI 15 Results Bush run Harvest (Expected) %tonnes%tonnes%tonnes 2005 $/tonne Gross revenue Average tonnes expected from tonnes/ha Hardwood volume (% total volume) Hardwood sawlogs Hard maple logs $ 99 $ 99 $17,348 $17,348 Soft maple logs 48.8 $ 50 $ 50 $ 439 $ 439 Beech logs 48.8 $ 45 $ 45 $ 395 $ 395 Yellow birch logs $ 60 $ 60 $ 1,581 $ 1,581 Hardwood pulp $ 30 $ 30 $ 9,882 $ 9,882 Softwood volume (% total volume) Softwood sawlogs Hemlock logs $ 35 $ 35 $ 1,089 $ 1,089 Spruce & balsam logs $ 60 $ 60 $ 1,244 $ 1,244 Softwood pulp $ 20 $ 20 $ 183 $ 183 Economic analysis – Forest manager

30 April 2008Cole/OFRI 16 Results 2005 Parkside Gully Harvest (observed) %tonnes%tonnes%tonnes 2005 $/tonne Gross revenue Total volume to mill (tonnes) Hardwood volume Hardwood sawlogs Hard maple logs $ 99 $ 99 $ 36,678 $ 36,678 Soft maple logs $ 50 $ 50 $ 52 $ 52 Beech logs $ 45 $ 45 $ 1,503 $ 1,503 Yellow birch logs $ 60 $ 60 $ 42 $ 42 Hardwood pulp $ 30 $ 30 $ 4,041 $ 4,041 Softwood volume 0 Economic analysis – Forest manager

30 April 2008Cole/OFRI 17 Results Estimated 2005 AFA bush run harvest 2005 observed Parkside Gully harvest Total gross revenue ($) a $ 32,162 $ 42,316 Logging costs ($/tonne) b $ 40 $ 40 $ 43 Total logging costs c $ 24,400 $ 23,206 Total net revenue d $ 7,762 $ 19,110 Total net revenue/ha ($/ha) $ 636 $ 1,566 Economic values – Forest manager a. From 12.2 ha b. Bush run logging costs range from $34-$46/tonne c. Logging cost x tonnes harvested d. (total gross revenue) – (total logging costs)

30 April 2008Cole/OFRI 18 Methods Economic analysis – Forest manager Many (but not all) natural resource economists assume that $100 in hand today is worth more than $100 expected to be received in the futureMany (but not all) natural resource economists assume that $100 in hand today is worth more than $100 expected to be received in the future To compare equivalent value of benefits in one year with those in a future year, a discount rate is applied to the future expected dollar value when estimating its net present value (NPV): NPV base yr = (future value), where (1+DR) y DR = discount rate, usually 0 < DR <.10 y = (future year) – (base year), ornumber of years over which the discount is calculatedTo compare equivalent value of benefits in one year with those in a future year, a discount rate is applied to the future expected dollar value when estimating its net present value (NPV): NPV base yr = (future value), where (1+DR) y DR = discount rate, usually 0 < DR <.10 y = (future year) – (base year), or number of years over which the discount is calculated

30 April 2008Cole/OFRI 19 Economic analysis question: What is the expected net present value (NPV 2005 ) of the Parkside Gully harvests vs. average bush-run harvests over 26 years ($/ha)? What is the expected net present value (NPV 2005 ) of the Parkside Gully harvests vs. average bush-run harvests over 26 years ($/ha)? But for which 26 year harvest cycle? But for which 26 year harvest cycle? Results Economic analysis – Forest manager Harvest Years Bush run XXX Parkside Gully XXXXX Option 1 Option 2 Option 3

30 April 2008Cole/OFRI 20 Results Economic analysis – Forest manager Δ = x $636 $3133$2777$2216

30 April 2008Cole/OFRI 21 Results Economic analysis – Forest manager Δ = x $636$380$110 $3133$2145$ 920

30 April 2008Cole/OFRI 22 Methods Mill analysis assumptions and calculations Observed actual Parkside Gully product yield for maple and beech, based on 407 tonnes processed at Tembec-HuntsvilleObserved actual Parkside Gully product yield for maple and beech, based on 407 tonnes processed at Tembec-Huntsville Value ($/FBM) for each product class from February 2006 mill pricesValue ($/FBM) for each product class from February 2006 mill prices Sawlog costs at mill gate to forest manager (pulpwood costs and revenues not included in mill analysis)Sawlog costs at mill gate to forest manager (pulpwood costs and revenues not included in mill analysis) Net revenue for logs sawn from Parkside Gully harvest (excl. other mill costs, e.g., depreciation, energy, labour)Net revenue for logs sawn from Parkside Gully harvest (excl. other mill costs, e.g., depreciation, energy, labour) Net revenue per tonne processedNet revenue per tonne processed Economic analysis – Mill manager

30 April 2008Cole/OFRI 23 Methods Mill analysis assumptions and calculations Estimated equivalent bush run product yield for maple and beech, based on same tonnage used to calculate log costs (220 tonnes)Estimated equivalent bush run product yield for maple and beech, based on same tonnage used to calculate log costs (220 tonnes) Value ($/FBM) for each product class from February 2006 mill pricesValue ($/FBM) for each product class from February 2006 mill prices Sawlog costs at mill gate to forest manager (estimated for bush run)Sawlog costs at mill gate to forest manager (estimated for bush run) Pulpwood costs and revenues not included in mill analysisPulpwood costs and revenues not included in mill analysis Net revenue and net revenue per tonne processedNet revenue and net revenue per tonne processed Economic analysis – Mill manager

30 April 2008Cole/OFRI 24 Results Net revenue calculations Estimated equivalent bush run Parkside Gully Maple sawn product revenue ($) $34,341$67,407 Beech sawn product revenue ($) + $2,337 + $9,529 Total sawn product revenue ($) $36,678$76,936 Hardwood log cost (excluding pulp) ($) - $19,764 - $38,275 Net revenue ($) $16,914$38,661 Tonnes processed Net revenue/tonne ($/tonne) $77$95 Economic analysis – Mill manager

30 April 2008Cole/OFRI 25 Conclusions Productive site with little or no high-grading history Provincial single-tree selection management guidelines, marking for quality improvement using careful logging Periodic annual increment ( m 2 /ha/yr) as expected from silviculture guide and some Ontario field studies (e.g., Stokes study); Not extreme or unrealistic We have sustainable basal area growth with commercial harvest every years over 40 years, although may not be practical for all sites or stands

30 April 2008Cole/OFRI 26 Conclusions After 4 cuts stands are approaching but have not quite reached desired diameter/basal area structure – (still a bit understocked in high-quality small sawlogs) Minimal impacts detected on overstory and understory woody species composition Snags in harvested stands had smaller diameter and lower density (#/ha) than uncut controls Downed coarse wood in harvested stands had similar number of pieces as uncut stands (#/ha), but smaller diameter and lower volume than uncut control stands

30 April 2008Cole/OFRI 27 Conclusions Forest land manager yielded ~ 3.4 – 8.4x net revenue from well-managed high-quality hardwood stand compared to current average crown land over 26 year management cycle, depending on economic assumptions made. Forest mill manager yielded ~ 1.2x net revenue in sawn boards from high-quality Parkside Gully harvest compared to typical bush run (conservative – no veneer from Parkside Gully)

30 April 2008Cole/OFRI 28 Closing thoughts Careful long-term tolerant hardwood silviculture on good sites pays! Careful long-term tolerant hardwood silviculture on good sites pays! If you have good quality within stands, try to protect or improve it. If you have good quality within stands, try to protect or improve it. Through policy, guidelines, practices, and science transfer, we should be encouraging tolerant hardwood management on year re-entry cycles, not accepting 25+ yrs as the norm. Through policy, guidelines, practices, and science transfer, we should be encouraging tolerant hardwood management on year re-entry cycles, not accepting 25+ yrs as the norm. Contact OFRI or the Forestry Research Partnership to arrange a tour of the Parkside Gully study area. Contact OFRI or the Forestry Research Partnership to arrange a tour of the Parkside Gully study area.

30 April 2008Cole/OFRI 29 Acknowledgements Thanks to  Living Legacy Research Program  Enhanced Forest Productivity Program  Forestry Research Partnership – Al Stinson, Nancy Young  Algonquin Provincial Park – Jim Murphy, Brad Steinberg, Joe Yaraskavitch, John Swick  Algonquin Forestry Authority – Bill Hubbert  Tembec-Huntsville – Gerald Kroes, Alex Encil  Southern Science and Information staff - Murray Woods, Wayne Reid, George Sanshagrin, Johnny Belanger, Andrea Knapp  Harvey Anderson, Elaine Mallory, Jeff Kokes, Jim Rice, Randy Fawcett  Al Corlett, Margaret Penner, Tony Kennedy, Marvin Chartrand

30 April 2008Cole/OFRI 30 Thank you

30 April 2008Cole/OFRI 31 Results Diameter class (cm) Year Total 1967 Pre-harvest (m 2 /ha) Periodic Annual Increment (m 2 /ha/yr) Periodic Annual Increment (m 2 /ha/yr) Periodic Annual Increment (m 2 /ha/yr) Post-harvest (m 2 /ha) Marking targets (2005) (1998 Silv. Guide) Basal area by diameter class & basal area growth

30 April 2008Cole/OFRI 32 Results 2006 hardwood board prices Hard maple$/MFBMBeech$/MFBM Select Sapwood & better$2,275Select Unspecified$625 4&5' clear No.1 common sapwood &better boards and 6' select sapwood & better boards$1,6807x9 Ties$590 No.1 Common Sapwood & better$1,6326x8 Ties$460 No.2 & No. 3a common #1&#2 White$960 No.1 Common Unspecified$425 No.2 & No.3a common Sapwood$860 4'' x 6'' Heartwood squares$390 No.2 & No.3a Unselected for color 6¼”$657 4'' x 4'' Heartwood squares$390 No.2 & better Regular$625 No.2 Common Unspecified$300 2”x3” heartwood squares$403No.3 Common$240 3”x3” heartwood squares$403 No.2 & No.3a Regular (Truck Flooring)$374 No.3b Common$235