Forest carbon under increasing product demand and land use change in the US Southeast

Increased demands for timber products remove carbon from forests, however previous literature has suggested that higher resulting prices could spur forestland expansion, ameliorating the forest carbon impacts. We examine the impacts on forest carbon from harvest increases with an empirical forest sector model, coupled with an econometric model of endogenous land use change that differentiates the impacts of population, income, and pine plantation rents among forest management types and non-forest land uses. We explore the sensitivity of forest area and carbon to a suite of scenarios by varying timber product demands combined with a sensitivity analysis on pine plantation responses to pine plantation rents. The econometric results show that pine plantation rents lead to increases in pine plantation area and that all non-urban land uses are negatively related to both per capita income and population. Scenario projections show that (1) higher pulpwood demands driven by wood pellets lead to lower forest carbon outcomes; (2) higher sawtimber demands exacerbate the known cycles in sawtimber prices and result in corresponding cycles in forest area and carbon. All scenarios show increases in forest carbon over time, though some scenarios increase faster than others. Within the study period, the highest forest carbon level is achieved by the high sawtimber demand and low pulpwood demand scenario. Long term growth cycles over the course of the projection period, however, lead to alternating forest carbon outcomes, indicating that conclusions about forest carbon depend on the projection length.