Economic analysis of carbon sequestration in cherrybark oak in the United States

The increase of carbon dioxide in the atmosphere and the possible greenhouse effect on global climate has become one of today's major environmental issues. Carbon can be captured in forests and remain sequestered in long-lived wood products. This study investigated the potential and profitability of afforestation of cherrybark oak (Quercus pagoda) on marginal agricultural lands in the lower Mississippi River Valley for the purpose of capturing carbon dioxide and mitigating the greenhouse effect. Cherrybark oak, with its fast growth, clear bole, and superior wood quality, is the highest value oak in the southern United States. In addition to the positive externality of capturing and storing carbon dioxide, the conversion of idle or marginal agricultural land to forestland will increase landowners' income, improve the environment and increase biodiversity, and enhance local and regional economies. However, landowners will afforest their lands only if the forest investment is profitable. To determine the profitability of afforesting these lands, the Forest Vegetation Simulator, an individual-tree, distance-independent growth and yield model, was used to simulate stand growth data, including diameter, height and volume from stand establishment to final harvest. Variables employed included site indices from 80 to 120 feet, thinning intensities of 20, 25, 30 or 35 percent of basal area removal, rotations up to 80 years in length, and a choice of 0, 1 or 2 thinnings. Cash flow analyses were conducted on the results of each possible thinning and harvesting regime using real alternative rates of return ranging from 2.5 to 15%.