Determinants of profit in sustainable forest management in the Brazilian Amazon

Abstract

The sustainable management of tropical forests has been a great concern and challenge for the forest sector in the Brazilian Amazon. This study aimed to better understand sustainable forest management in the Brazilian Amazon focusing on two research questions: (a) Is sustainable tropical timber production financially viable? (b) What are the profit determinants under sustainable forest management? In this research, we assessed information of all approved forest management plans in 2011 in the Sinop region, located in the eastern Brazilian Amazon. Sequentially, we selected and tested using econometric tools these variables: Profit, managed area, volume of timber, number of managed species and timber price. Our results show that the average profit is of US$ 1,003.00 per hectare in sustainably managed forests and we observed that the variables volume of timber per hectare and timber price explain the profit of this forest activity presenting the best fit econometric results.