Determining the Net Present Value of Timber Investments and Comparing Investments of Different Rotations
Vol. 2019 No. 6, School of Forest, Fisheries, and Geomatic Sciences
Vol. 2019 No. 6

Determining the Net Present Value of Timber Investments and Comparing Investments of Different Rotations: FOR352/FR421, 11/2019

School of Forest, Fisheries, and Geomatic Sciences
https://doi.org/10.32473/edis-fr421-2019
Published 2019-12-02
Andres Susaeta
University of Florida
Chris Demers
University of Florida
A drone aircraft in mid-flight. Photo taken 06-14-19.
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PDF-2019

Keywords

net present value
equivalent annuity approach
single rotation

How to Cite

Susaeta, Andres, and Chris Demers. 2019. “Determining the Net Present Value of Timber Investments and Comparing Investments of Different Rotations: FOR352/FR421, 11/2019”. EDIS 2019 (6). Gainesville, FL:4. https://doi.org/10.32473/edis-fr421-2019.
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Abstract

Would a forest landowner be economically better off growing a forest for pulpwood production with a short rotation instead of growing the same forest for sawtimber production with a longer rotation? To help answer this and related questions, this 4-page fact sheet written by Andres Susaeta and Chris Demers and published by the UF/IFAS School of Forest Resources and Conservation presents two approaches to determine the profitability of a forest stand. The net present value (NPV) of a single rotation provides the criterion to choose between different forest project investments of equal lives, whereas the equivalent annuity approach (EAA) is employed when forest project investments have different time lengths.
http://edis.ifas.ufl.edu/fr421

 

https://doi.org/10.32473/edis-fr421-2019
view on EDIS
PDF-2019

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 4.0 International (CC BY-NC-ND 4.0) license.