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Economics, Statistics and Life Cycle Analysis Research
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Project Title :
There is a need to monitor and model market equilibria, production trends, and technology changes of the U.S. foreset product industry Project Number : FPL-4851-3A Status : TERMINATED Start Date : 07-23-2007 End Date : 07-23-2012 View the 15 publications associated with this project. |
Principal Investigator: Kenneth E. Skog |
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| Non Technical Summary | ||
 This problem is focused on long-range economic modeling of the U.S. forest products sector in the context of policy shifts, and global trade. This includes developing a long-range model of supply, demand, production and capacity trends by U.S. for the Forest Service RPA assessment, and also other model development research, such as modeling market impacts of expanded fuel treatment programs in the U.S. West. | ||
| Objectives Summary | ||
| Problem 3 is focused on long-range economic modeling of the U.S. forest products sector in the context of structural changes, policy shifts, and global trade. This includes developing a long-range model of supply, demand, production, and capacity trends by U.S. region for the RPA assessment, and also other model development research such as modeling market impacts of expanded fuel treatment programs in the U.S. West. The United States provides nearly 30% of world paper and paperboard production, about 25% of world softwood lumber output, and an array of other wood products ranging from wood panels to furniture and fuelwood. In recent years an increasing proportion of U.S. wood product consumption has been imported. It will be crucial in the 2010 Forest Service RPA forest assessment to accurately model and project the future resource needs for pulp, paper, and other wood products in the United States in the context of global trade projections. The global trade model that will be used for the next RPA assessment is the GFPM Model (maintained at University of Wisconsin-Madison). It provides a comprehensive coverage of global trade in all forest products (pulp, paper and other wood products), but it is a very general model that provides very little detail on market trends within the United States, such as trends among U.S. regions, or trends in wood use by species group (hardwood and softwood). Our research contribution will be to add an appropriately detailed U.S. Forest Products Module (USFPM) to the GFPM model, including testing, calibration and interpretations of results. USFPM and GFPM are based on the Price-Endogenous Linear Programming System (PELPS). Issues of concern to forest managers related to global and domestic market trends include uncertainty about future demands for forest products, U.S. industry competitiveness and trade, and future wood supply options. As demand increases and new technologies emerge, the potential for product substitution needs to be examined (e.g., plastics or electronic media for paper). Imports have made significant inroads to U.S. forest product markets in recent years, raising questions about future competitiveness and trade. Future wood supplies may also be augmented by fiber farming or biotechnology. The long-run limits and impacts of these shifts on forest management need to be evaluated using rigorous analysis and quantitative techniques, while also reporting on global market trends. Analysis is needed to determine the likely global market trends and regional implications for forest management in the United States. For government and industry to develop strategic plans in resource management, they need to anticipate changes in resource markets and develop ways of meeting future resource demand and supply needs. Policymakers and forest managers need continuously updated information on the interactions between market trends, forest policies, and regional wood resource needs in the U.S. forest product sector, in both the short run and long run. | ||
| Approach Summary | ||
| For the 2010 RPA forest assessment, a new modeling system is being developed called the U.S. Forest Assessment System (or USFAS), designed by researchers at the Southern Research Station. FPL researchers have been enlisted to help develop the PELPS-based U.S. Forest Products Module (USFPM) as part of USFAS. USFPM will be developed as a module within the Global Forest Products Model (GFPM), which is also a PELPS-based model. Accomplishments planned for the next 5 years include the following areas: 1. Develop advanced long-range forest product market module (USFPM) including dynamic interaction with global economy (as part of GFPM). This work will include designing the regional and commodity structure of USFPM, estimating model parameters and coefficients, incorporating USFPM into GFPM, calibrating and testing the modeling system, and developing and interpreting results of analysis. Model parameters that will need to be estimated for USFPM include elasticities of demand for wood products at the national level, regional production cost and wood input requirements for wood products, and other structural elements of the model such as transportation cost estimates, wood flows, and base level supply and demand quantities. 2. Structural Change Analysis: Evaluate and report periodically on dynamic developments in U.S. pulp, paper, and paperboard markets and other forest product markets, particularly those developments that represent structural changes in demand or technology, and which are therefore significant in long-range forest sector modeling. Special Model Applications: There will likely be specialized FPL applications of RPA market models (USFPM and GFPM), as in evaluating potential economic impacts of new technology developments, such as development of biorefining (fuel ethanol) |
Publications associated with this Project
| Project Summaries last modified: 06-21-2011 |