Rates of return from forest plantation investments depend not only on survival and growth rates, but also costs and revenues associated with various practices.  Beyond that, tax related issues are another important consideration that are often not addressed, or directly addressed at least, in forest financial assessments.  Many financial assessments can be defined as “before-tax.”  Forest landowners within Mississippi have the potential to reduce reforestation cost burdens through two important tax-related opportunities.  The first being the Federal reforestation deduction and amortization provisions and the second being the state-based reforestation tax credit.  An overabundant supply of wood in Mississippi has resulted in fairly poor pine market conditions, particularly for pulpwood stumpage.  This has resulted in the likelihood of marginal returns for many landowners without some type of assistance.  Beyond that, substantial inflation and increases in fuel costs have resulted in greater reforestation costs plus additional reductions in stumpage values, among other reasons, because of greater costs for loggers during forest harvesting operations.      The impacts of these two income tax reduction opportunities on loblolly pine financial returns were examined for three planting densities of 1,122 and 1,282 and 1,495 seedlings ha-1 for a site index 19.8 m site (base age 25).  A combination of chemical and mechanical site preparation was conducted and mass control pollinated (MCP) bareroot seedlings were hand-planted.  Varying degrees of rectangularity were assumed, reducing reforestation costs.  A first-year herbaceous weed control treatment was implemented but no thinnings and fertilization treatments were conducted.  A final harvest clearcut was conducted at age 26.  For Federal income tax purposes, a landowner classified as an Investor within the 22% Federal income tax bracket was assumed.  Whether before-tax or after-tax, the most viable planting density financially was found to be 1,122 ha-1 seedlings.  Reduced reforestation costs and greater yields ha-1 of the more valuable sawlog product class were found to be more influential on landowner financial returns than any reforestation tax provisions.

Predicting future yields normally requires an estimate of site quality.  A commonly used measure is site index (SI). SI is often incorrectly quantified operationally due to the ambiguity associated with selecting “site” trees.  Plus, error in the measurement of height itself occurs.  This study quantifies the impacts on the number and timing of thinnings, and the final harvest ages, as well as financial returns when incorrectly determining SI.  Three values of SI (base age 25 years) were examined using two older generation loblolly pine plantation growth and yield simulation models from the Western Gulf, USA; 16.76 m, 21.34 m, and 25.91 m.  Firstly, a particular SI was assumed to be the “true” value, growth and yield estimates were obtained, and financial assessments were conducted.  The same process was then conducted again, but assuming that the SI was incorrectly determined by varying positively and negatively the SI by up to 1.22 m from the assumed “true” value. For these older generation plantations, incorrectly determining SI did impact the age of the first thinning by as much as 5 years.  In some cases, errors of +/- 1.22 m in SI estimation had little impact on the estimated timing of the first thinning.  Errors in SI of up to +/- 1.22 m had little impact on the number of thinnings across economic rotation ages. For both unthinned and twice-thinned stands, final harvest (clearcut) ages differed by as much as 4 years for SI errors up to +/- 1.22 m.  These errors led to differences in Land Expectation Value (LEV) up to $406.50 ha-1.  Across the three SI (16.76, 21.34, and 25.91 m), differences in LEV ranged from $237.49 to $406.50 ha-1.  These differences in LEV could be enough to incorrectly not conduct, or incorrectly conduct, a silvicultural operation such as an herbicide treatment or a fertilization treatment across a rotation, among other treatments.

This analysis compares the growth and yield of 16-year-old shortleaf pine (Pinus echinata Mill.) and loblolly pine (Pinus taeda L.) planted on retired fields near Holly Springs in north Mississippi.  The 1-0 bareroot shortleaf seedlings were planted in early March of 2005, while bareroot 1-0 loblolly pine 2nd-generation seedlings were planted during the third week of March in 2005.  For both species, the site was subsoiled.  Within the plantations of each species, four plots were established for each species and total height and diameter at breast height (dbh) were measured.  Volumes were then estimated using appropriate combined-variable volume equations.  Loblolly pine had substantially greater growth rates relative to shortleaf pine, producing on average across the four plots (n = 4) 48.4 m-2 of basal area ha-1.  This basal area was 42.6% greater than the 34.0 m-2 of basal area ha-1 observed within the shortleaf pine.  For merchantable volume, defined as all trees with a dbh of 10.16 cm and greater up to a diameter-outside bark (dob) of 5.08 cm, the loblolly pine m-3 volume ha-1 of 424 was 2.36 times greater than that of shortleaf pine.  Merchantable volumes were converted to tons and a revenue of $3.61 was assumed per ton of pulpwood.  A theoretical 3rd row thinning with no logger select of the remaining rows was conducted – hence the thinning was assumed to remove 33% of the standing merchantable yield.  Loblolly pine had a stumpage value of $97.39 ha-1 which was 136% greater than the shortleaf pine economic value of $41.23 ha-1.