Modeling the Effects of Invasive Species on the International

Trade of Forest Products

Joseph Buongiorno, Shushuai Zu, Ruhong Li

U.W. Madison

James Turner

Forest Research, Rotorua, NZ

Jeff Prestemon

USDA-FS, SO

Background• U.S. forests at risk

– Chestnut blight, early 1900s– Dutch Elm Disease, mid-1900s– Balsam and Hemlock Woolly Adelgids– Sudden Oak Death– Gypsy Moth– Spruce budworm– Oak wilt

• U.S. is largest producer, consumer, importer• Globalization

– GATT-WTO– NAFTA– FTAA

• Growing trade => growing threat• Other countries face same issues

Objectives

• Losses incurred by producers and consumers due to timber supply reductions caused by invasive species

• Effects of regulations (phytosanitary rules and import bans) on producer and consumer welfare

Global Forest Products Model

Dynamic Competitive equilibrium

Demand Supply Trade

14 forest products

180 countries

GFPM Product FlowRaw material Intermediate product Final product

Fuelwood

Industrial roundwood

Other roundwood

Other fiber pulp

Waste paper

Fuelwood

Other industrial roundwood

Sawnwood

Plywood

Particleboard

Fiberboard

Newsprint

Printing & writing paper

Other paper & paperboard

Mechanical pulp

Chemical pulp

π T

T

T +1

Q T

P T

P T+ 1

Q T +1

GFPM dynamics

Alternative Scenarios

Status quo projections, 2002 – 2012

Ban on global trade of logs

Status quo:World plywood consumption

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011

Year

Thou

sand

cub

ic m

eter

s

Africa North/Central America South America Asia Oceania Europe

Status quo: Net Trade of Industrial Roundwood

-120000

-90000

-60000

-30000

0

30000

60000

1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011

Year

Thou

sand

cub

ic m

eter

s

Africa North/Central America South America Asia Oceania Europe

Status quo: U.S.ANewsprint

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

1961 1971 1981 1991 2001 2011

Year

mil

lio

n t Production

ImportExportConsumption

Status quo: World Prices

Price of Paper and Paperboard

0

200

400

600

800

1000

1200

1400

1600

1961 1966 1971 1976 1981 1986 1991 1996 2001 2006

Year

1997

US

$ pe

r met

ric to

n

Newsprint Printing & writing paper Other paper & paperboard

Effects on industrial roundwood

Cons Prod Import Export

United States 3% -1% -100% -100%

Brazil 2% -1% -100% -100%

China -17% 48% -100% -100%

Indonesia 3% 2% -100% -100%

Japan -43% 18% -100% -100%

Malaysia 9% -3% -100% -100%

EU-15 -5% 7% -100% -100%

Russian Fed 7% -35% -100% -100%

World -2% -2% -100% -100%

Effects on Sawn woodCons Prod Imp Exp

United States -1% 4% 0% 172%

Brazil -2% 0% 0% 14%

China -9% -65% 20% -33%

Indonesia -1% 4% 0% 15%

Japan -7% -61% 82% 0%

Malaysia -4% 5% 0% 12%

EU-15 -2% -5% 7% -1%

Russian Fed -1% 7% 0% 14%

World -2% -2% 11% 10%

Effects on Wood Panels

Cons Prod Import Export

United States -2% 2% -4% 73%

Brazil -2% 4% -8% 14%

China -12% -21% 7% -19%

Indonesia -1% 5% 0% 11%

Japan -7% -77% 54% -1%

Malaysia -6% 12% 39% 18%

EU-15 -7% -8% 7% 1%

Russian Fed 0% 20% -17% 66%

World -5% -5% 8% 8%

Effects on Wood PulpCons Prod Import Export

United States 1% 3% 0% 18%

Brazil 3% 3% 0% 4%

China 6% 1% 6% 0%

Indonesia -1% 0% 0% 1%

Japan -2% -11% 43% -30%

Malaysia 11% 19% 0% ----

EU-15 -4% -3% 1% 3%

Russian Fed 0% 1% 0% 3%

World 0% 0% 4% 4%

Effects on Paper and Paperboard

Cons Prod Import Export

United States 0% 1% -4% 3%

Brazil 2% 3% -2% 9%

China 0% 5% -12% 10%

Indonesia -1% -1% -6% -2%

Japnan -1% -2% 25% -24%

Malaysia 0% 7% -2% 42%

EU-15 0% -3% 1% -4%

Russian Fed -1% 0% 0% 3%

World 0% 0% -2% -2%

Effects on prices

  World U.S.A

Industrial Roundwood 4% -3%

Sawnwood 7% 5%

Panels 17% 6%

Pulp 8% 23%

Paper and paperboard 2% 2%

Future Work

• Finish log export ban scenario analysis

• Study effects of treatment costs on trade, production, and prices

• Develop timber supply sub-model to simulate effects of invasive species