CAN I PROFIT FROM A

CLONAL PINE PLANTATION?

 

By David B. South

School of Forestry and Wildlife Sciences

Auburn University

 

This clonal plantation in Alabama may have cost an additional

$200/acre to establish.  Will this investment increase the value

at harvest at age 20 yr by $800/acre?  Will it increase

productivity by 2 tons per acre per year?

 

Who plants tree clones?

 

For decades, clones of cottonwood (in the Mississippi Delta), Populus (in Oregon) and eucalyptus (in Brazil) have been planted by the forest industry.  This is because cuttings of these trees can be produced relatively inexpensively and the trees are harvested relatively quickly (e.g. 7 to 10 years).  However, a few forest companies in the South are now establishing some pine plantations using clones (produced from cuttings or from tissue culture).  The tissue-cultured plants may cost 35 to 45 cents each (or about 10 times the cost of typical loblolly pine seedlings).  Although this may seem to be expensive, one company in New Zealand pays about 68 cents for a tissue-cultured pine which will be harvested in about 23 years (Table 1).  In comparison, some companies are now selling their best open-pollinated 2nd-generation seedlings for about 5 cents each. 

 

Table 1.  Some prices of seedlings and clones by species and nursery location.  Prices for tissue cultured pines are listed in BOLD.

Stock type

Species

Nursery location

Cents per plant

Plug-1

Cypress-nootka false

Michigan

160

Container

Bur oak

Montana

150

Container

Leyland cypress

Maryland

125

Container

Sycamore

Ohio

80

Bareroot

Live oak

Mississippi

75

Container

Monterey pine clone

New Zealand

68

Container

Cherry bark oak

Georgia

65

Bareroot

Loblolly pine clone

South Carolina

45

Bareroot

Black walnut

Tennessee

40

Container

Aspen

Minnesota

40

Bareroot

Loblolly pine clone

Georgia

35

Bareroot

Baldcypress

North Carolina

35

Bareroot

Monterey pine cutting

New Zealand

33

Bareroot

Crabapple

Louisiana

30

Container

Fraser fir

North Carolina

28

Bareroot

Loblolly clone >1.5 million

Mississippi

26

Bareroot

Eastern red cedar

North Carolina

20

Container

Longleaf

Mississippi

15

Bareroot

Longleaf

North Carolina

8

Bareroot

Loblolly – 2nd gen. family

Alabama

5.2

Bareroot

Loblolly – 1st gen. mix

Mississippi

4

 

 

A loblolly pine grown from tissue culture might cost 10 times as much as one grown from seed.   When planting 300 trees per acre, this might increase establishment costs by $90 per acre (or $200 when planting 700 trees per acre).

 

Who profits from planting clones?

 

Harvesting wood from clonal plantations can sometimes increase mill profits.  For example, if a clone produces less lignin, the profits from a paper mill can increase (one report predicted a $5 increase in added value per ton of eucalyptus wood).  If a clone produces small branches, then a sawmill owner might profit by producing lumber with fewer defects.  A few economists claim that companies can reduce forest management costs by selling some of their forest land (and increasing wood production from clonal plantations). The opportunities for making money from clonal plantations are greater for industries that operate mills than for a landowner who establishes only one 50-acre plantation.

The private, non-industrial landowner might profit if the harvest age is shortened, if wood production is increased, or if the mill pays the landowner more per ton for clonal sawlogs.   The private landowner will only profit from clonal plantations when the discounted revenue from selling logs exceeds the discounted costs.  

 

 

Will I profit from planting pine clones?

 

Do you own a paper mill?  If not, then you might not profit from growing low-lignin clones on a 13-year pulpwood rotation.  You might not be able to convince the pulpmill that pulpwood from your clones is worth $5 more per ton than your neighbors’ pulpwood.  Do you own a sawmill?  If not, then you might not profit from growing clones with smaller branches.  Some high-production sawmills currently pay the same price per green ton for both loblolly pine and longleaf pine sawlogs (even though longleaf pine typically has smaller branches than loblolly pine).

 

In hopes of realizing a profit, some landowners assume the more expensive clones will produce desirable sawlogs sooner than pine seedlings from genetically improved, second-generation orchards. Some assume sawmills in the future will pay the same price per ton for 18-year-old sawlogs as they currently pay for 30-year-old sawlogs.

 

Both these boards were sold for the same price at nationwide chain store.

The 2x8 board on the bottom contains only 10 growth rings and perhaps was

made from an 18-yr-old pine. Will sawmills in the future be willing to pay the same price per ton for

18-year-old sawlogs as they currently pay for 30-year-old sawlogs?

 

 

Can I profit if I get paid 20% more in 20 years?

 

That is a great question.  The answer will depend on the productivity of your site, the number of planted trees per acre, your desired discount rate, the stumpage price in your area and the extra cost of the clones. The following table (adapted from a paper by Stelzer and Goldfarb 1997) can help landowners understand the potential relationships of stumpage value, tree stocking, rotation age, discount rate and increase in stand value.  Table 2 can be used to determine the added value PER PLANTED TREE that would result when trees are planted on a “medium” site (site index = 75 feet in 25 years).

 

 

 

Table 2:  Present value per planted treet of 10%, 15% and 25% increase in stand value. This table can be used to determine the added value per planted tree (i.e. propagule)  IF the tree increases stand value at harvest by 10%, 25% or 50%.   The base level (without clonal stock) produces about 5 to 6 tons per acre/yr in 20 years.   Red numbers represent cases where the added value amounts to less than 30 cents per tree (at time of planting).

Wood price per US ton

Rotation age

Planting density

Base level  production

(no-clone)

10% discount rate

 

improved value

6% discount rate

 

improved value

 

years

Trees per acre1

Tons per acre

10%

25%

50%

10%

25%

50%

 

 

 

 

--------- cents per propagule ----------

$10

10

700

36

2.0

5

10

2.8

7

14

$10

10

500

31

2.4

6

12

4.0

10

20

$10

10

300

23

3.0

7

15

4.3

11

21

$10

15

700

82

2.8

7

14

5

12

24

$10

15

500

73

3.5

9

17

6

15

30

$10

15

300

58

4.6

12

23

8

20

40

$10

20

700

121

2.6

6

13

5

13

27

$10

20

500

112

3.3

8

17

7

17

35

$10

20

300

94

4.7

12

23

10

24

49

$10

25

700

150

2.0

5

10

5

12

25

$10

25

500

144

2.6

6

13

6

17

33

$10

25

300

126

3.9

9

19

10

24

49

$20

10

700

36

4.0

10

20

5.6

14

28

$20

10

500

31

4.8

12

24

8.0

20

40

$20

10

300

23

5.9

14

30

8.6

22

42

$20

15

700

82

5.6

14

28

10

24

48

$20

15

500

73

7.0

18

34

12

30