Forest Management Optimization for Carbon Sequestration, Timber and Bioenergy Production: a Case of Eucalyptus Plantations in Northeast Vietnam
탄소 고정, 목재 및 바이오에너지 생산을 위한 산림 경영 최적화: 동북베트남에서의 유칼립투스 플랜테이션을 대상으로

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Youn Yeo Chang
농업생명과학대학 산림과학부(산림환경학전공)
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Seoul National University
Forest Environmental Sciences
학위논문 (박사)-- 서울대학교 대학원 : 산림과학부(산림환경학전공), 2012. 8. Youn Yeo Chang.
To combat global warming forced by CO2, forest has generally proved to be a wise option economically and environmentally (Tavoni et al. 2007
Han and Youn 2007). Yet, to date there have been substantial knowledge gaps around how carbon sequestration and the associated costs is influenced by changes in forest management (e.g. harvesting time, selection of species, alternative combination of several forest uses). This thesis will provide insight into optimal forest management for economic carbon, timber and bioenergy management when alternative forest management objectives are considered. It takes Eucalyptus urophylla S.T Blake clones planted in Northeast Vietnam in Fluvic Gleysol and Ferric Acrisol soils as a case study. First, timber yield functions for all eucalyptus monoculture clones and seedlings are identified. Next, the biological optimum rotation period for maximizing sustained yield is calculated based on the yield functions for each soil type. Then, the economically optimal rotation (EOR) lengths for single-production management of timber at the two types of soil are calculated using a modified Faustmann model (Scenario 1). In the last section, economic optimal rotation management is investigated a for the joint production of timber and bioenergy production (Scenario 2), and for the joint production of carbon sequestration, timber and bioenergy production (Scenario 3).

The results indicate that eucalypts at Fluvic Gleysol will produce larger timber yields than at Ferric Acrisol. Among the clones commonly planted in Northeast Vietnam, eucalyptus clones U16 and PN14 can yield the largest timber volumes at Fluvic Gleysol and Ferric Acrisol, respectively.

In regards to the economic optimal rotation for timber management, eucalyptus plantations in Northeast Vietnam have optimal rotation even longer than the biological rotation, exceeding it by 1-3 years under the subsidized interest rate 8.4% by the government for rural households. If growers borrow from commercial entities (mean interest rate = 15.24%) or private credit sources (mean interest rate = 19.08%), such rotation periods will be substantially shortened
in many cases, it becomes economically unviable. Nevertheless, wherever the tree-growing business is profitable, Vietnamese growers should extend their current farming business cycle of 7 years to 14-18 years under the mean subsidized credit scheme and to 10-12 years under the market-borrowing interest rate to capture the highest gains from eucalypt plantations. This finding suggests that the Vietnamese government should restructure the credit scheme and should institute proper supervision and enforcement to ensure that the economic optimal harvesting time is achieved in practice.

If growers shift their timber management objective to a joint production of timber and raw bioenergy source, the land economic value (LEV) measured at the mean interest rate of 19.08% of private credit market remains negative due to too high interest rate relative to forestry productivity
Whereas, LEV of the two other credit market segments (governmental subsidized credit and commercial borrowing credit markets) will be boosted up by moderate level. However, the improvement of LEV does not mean having a longer rotation length. In fact, the rotation length at governmental subsidized interest rate of 8.4% reveals somewhat shorter with Scenario 2 when compared to Scenario 1. Thus, in this case, a higher LEV comes at an expense of timber supply and thus carbon accumulation. Collecting firewood under Scenario 2 is thus a good strategy in terms of profits but may not a sound option in term of carbon uptakes. However, the reduction tendency of carbon balance is not substantial due to the proportion of bioenergy materials comparing to timber production is relatively small. Therefore, the decision making frameworks for carbon mitigation maybe capable of incorporating such levels of confliction.

Further internalizing carbon value jointly with timber and bioenergy production into growers objective equation leads to longer rotation length. Grower now should delay harvesting time until 16, 14, 13 years, respectively, under subsidized credit-, commercial credit-, and private credit market segments. At the current carbon price of CDM-market (83,336 VND/tCO2 or 4 $/tCO2), the LEV of the joint production is now boosted up by 2 folds, reaching to 168,790,640 from 80,904,552 VND/ha when considering at the governmental subsidized interest rate of 8.4%. At the high interest rate of private credit segment, LEV even turns negative profit value (-1,833,705 VND/ha) to positive profit value (17,869,789VND/ha) when shifting from timber management to the joint production management. This implies that if bioenergy production and carbon sequestration are also rewarded additionally to the timber value, the unprofitable sites for timber plantations may be financially employed for AR-CDM projects. When the carbon market is emerging, this may impact on the timber market substantially
therefore, the government and the growers should aware of that impact and be prepared according to the emerging carbon market.
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College of Agriculture and Life Sciences (농업생명과학대학)Dept. of Forest Sciences (산림과학부)Theses (Ph.D. / Sc.D._산림과학부)
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