Healthy Demand for Southern Timber Ensures Forested Lands Remain Forested

The evidence is clear: Demand for forest products—including wood pellets, wood chips and other renewable wood resources used to generate energy—is associated with more, not less, productive forests.
By Hannah Jeffries | April 23, 2018

The evidence is clear: Demand for forest products—including wood pellets, wood chips and other renewable wood resources used to generate energy—is associated with more, not less, productive forests.

A 2017 report by Forest2Market unequivocally illustrates that demand from the forest products industry has not resulted in dramatic losses to timberlands in the U.S. South, the most productive wood basket in the world. Rather, it has encouraged landowners to invest in productivity improvements that dramatically increased the total amount of wood fiber in the South’s forests. Forest2Market’s independent statistical analyses show that increased demand in the South since the early 1950s is associated with more acres, better growth and larger inventories.

The rise of the export pellet market over the past decade has caused some to question the impact that pellet mills are having on forest inventory. However, as data from a previous (2015) Forest2Market study on wood supply in the U.S. South shows, pulpwood harvests for export facilities are but a small fraction of overall harvests when compared to harvests for nonpellet facilities, and claims that this impact is disastrous are largely exaggerated.

Historical Perspective
Since the middle of the 20th century, the amount of timberland—unreserved, productive forest land—in the U.S. South has remained stable, increasing by about 3 percent between 1953 and 2015. During this period, economic growth and increased construction spurred consumer demand for forest products, which drove an increase in timber harvests (removals) of 57 percent. During this same period, the amount of wood fiber (inventory) stored in southern forests increased by 108 percent.

During the latter half of the 20th century, demand for forest products expanded significantly as the U.S. population and gross domestic product (GDP) increased. Americans built more and larger homes, and until the dawn of the digital era in the 1990s and 2000s, consumed more and more paper to conduct their business and supply their homes. All of this fueled demand for timber to make the many forest products Americans use daily and, as a result, timber removals nearly doubled from 5.5 billion cubic feet in 1953 to a peak of 10.2 billion cubic feet in 1996.

Around the turn of the new millennium, technological improvements reduced demand for printing and writing papers, and increasing imports reduced demand for domestically-produced lumber and panels. The housing bubble of the mid-2000s buoyed domestic lumber and panel production until the Great Recession dramatically reduced housing starts and demand for these products. Today, timber removals in the U.S. South, which have recovered due to improving housing markets, increased demand for personal hygiene and packaging products, and new demand from global bioenergy markets, are still below their 1990s peak, but they are 57 percent higher than they were in 1953—due largely to increased removals from private softwood stands.

Forest Management Improvements
Detailed research over the past 50 years, which was conducted in partnership with the U.S. Forest Service, university forestry departments, state agencies and industry partners, has resulted in fact-based improvements to forest management practices, including site preparation, fertilization, weed control and thinning. These efforts have also enhanced the quality and survival of seedlings.

The result of these improvements has been an astounding nearly fourfold increase in the amount of growth achievable for seedlings established in the 2000s, compared to seedlings established in the 1950s. Largely because of the implementation of these practices on privately-owned lands, total annual timberland growth in the U.S. South increased 112 percent between 1953 and 2015, and growth exceeded removals by 38 percent on average. Healthy demand has made it easy for corporate and family landowners to take a long-term view, investing in more expensive management practices up front for greater returns in the future. Most importantly, stable demand from the forest products industry helps protect forestland from its greatest, irreversible threat: urbanization.

Healthy Demand Mitigates Forest Loss
As with the total area of southern timberland, the total amount of forest land in the U.S. has been stable in recent years, according to USDA data. However, while total acreage has remained stable, U.S. forests have not been impervious to change. National land cover/use data shows that approximately 36 million acres of forestland converted to other land cover and use types between 1982 and 2012. Of these converted acres, 17.7 million acres (49 percent) were lost to development—more than any other single land cover/use type. While forest land converted to other uses, other land use types also converted to forest, resulting in a 0.7 percent net increase in forest acres. However, of the 39 million acres of land that converted to forest during this same period, only 0.5 million acres, or 1.2 percent, were previously developed; most were previously pasture or cropland.

This data shows that developed land uses, which expanded by 58.7 percent between 1982 and 2012, place undeniable pressure on forests. Further, once developed, land rarely ever reverts back to forests. Urbanization, not the production of forest products, is the single biggest threat facing forests today. While landowners harvest timber from their lands, they typically also regenerate that timber and keep forests forested, especially if they can find readily accessible, healthy markets for their timber.

Demand from the global forest products industry helps protect forests in the U.S. South. For example, planted stands, which are some of the most productive, have been the least likely to succumb to the pressures of conversion. Between 1989 and 1999—the only period available for this kind of analysis—5.4 million acres of stocked timberlands in the U.S. South were converted to nonforest uses. Of these lost acres, the overwhelming majority (94 percent) were naturally regenerated forests, not planted stands. Not only does demand for forest products increase the productivity of forests and provide an incentive for landowners to continue growing trees, it also helps counter factors like urbanization and development, which permanently destroy forests.

The Future of Forests
While timberlands in the U.S. South have been stable to increasing since the 1950s, the pressures of urbanization are projected to result in forest loss over the coming decades. However, healthy markets for wood products are expected to mitigate, not exacerbate, these losses. High demand encourages producers to increase, not decrease, their supply of timber in the forest.

As Forest2Market’s comprehensive analysis illustrates, strong demand for forest products incentivizes landowners to maintain their timberlands, and invest in forest productivity in order to increase supply, which has resulted in more wood growing in U.S. South forests. The future of forests depends on healthy demand for forest products. This demand is vital for keeping forested lands forested and for diminishing the threat of urbanization.

Author: Hannah Jeffries
Timber and Fiber Market Analyst, Forest2Market Inc.