Effects of sale-specific factors on stumpage prices in Finland

Abstract

Buyers of standing timber take not only the market situation but also the harvest costs into consideration when making purchase offers. In Finland, 85% of all timber is sold as standing timber, but there is little information for forest owners and third parties regarding how differences in harvest costs are reflected in the stumpage prices. This article analyses the relationship between salespecific factors and stumpage prices in Finland. Data on 4824 standing timber sales between 2008 and 2012 were gathered from five local Forest Management Associations. Regression analyses were run on the stumpage prices (euros m–3) paid for sawlogs and pulpwood. Seasonal harvest restrictions, the volume of the sale and the timber assortment influenced stumpage prices, as did the presence of forest damages. Prices also differed over time and between locations. Furthermore, the forest haulage distance was statistically significant for pulpwood. The results suggest that the size of the individual sales and the composition of assortments affect the income owners earn from their forest. The results can be used to estimate stumpage prices and the monetary impacts on forest owners of procedures such as forest road network planning and land consolidation, as well as for valuation of forests.