Journal of Forest Economics > Vol 30 > Issue 1

Land expectation value and optimal rotation age of maritime pine plantations under multiple risks

Claudio Petucco, LEF, INRA, AgroParisTech, France, Pablo Andrés-Domenech, LEF, AgroParisTech, INRA, France,
Suggested Citation
Claudio Petucco and Pablo Andrés-Domenech (2018), "Land expectation value and optimal rotation age of maritime pine plantations under multiple risks", Journal of Forest Economics: Vol. 30: No. 1, pp 58-70.

Publication Date: 0/1/2018
© 0 2018 Claudio Petucco, Pablo Andrés-Domenech
JEL Codes:Q23C61
FaustmannForest managementOptimal rotation lengthStormPestPine processionary moth


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In this article:
The model 
Model calibration and simulation set-up 
Results and discussion 


Maritime pine (Pinus pinaster) is the most important conifer species in France in terms of wood production. It is mostly cultivated in even-aged monoculture stands in the Landes forest. These plantations are exposed to multiple biotic and abiotic risks: most importantly the cyclical outbreaks of a defoliator, the Pine Processionary Moth (PPM, Thaumetopoea pityocampa), and storms causing large windthrown. This study aims to compute the optimal rotation age and land expectation value (LEV) for maritime pine plantations in order to assess the impact of these disturbances. Using stochastic simulation methods, we simulate multiple scenarios combining different disturbance intensities. Our results show that both disturbances reduce LEV individually. When combined together, the two disturbances generate subadditive losses (i.e. combined damages are smaller than the sum of the damages from each disturbance individually). The impact on the optimal rotation length, however, is different for the two analysed risks: While storms tend to reduce the optimal harvest age, PPM tends to increase it. Overall, the impact of PPM on the rotation length prevails and, here, risks increase rather than decrease the optimal rotation length. Thinnings play an important role. They do not only increase profitability but also constitute an effective hedging strategy against both risks since they mitigate the negative impacts of PPM and storm disturbances for all the tested scenarios.