Browsing by Subject "wood supply"

Finnish round wood industry is reliable on Finnish nonindustrial private forest owners (NIPF) wood sales. More than half of the raw material that Finnish round wood industry uses comes from NIPF’s. Therefore, it is important for the Finnish round wood industry and for the whole economy to know the issues that have an effect on NIPF’s wood supply. This paper examines the supply of round wood in Finland using the theoretical approach of Fisherian consumption-saving model. This research examines the price elasticity of wood supply in Finland at regional level. To examine the regional markets Finland is divided to six price areas. The monthly price- and quantity data from year 1987 to 2007 is gathered from the Finnish forest research institute (METLA). This paper examines standing sale supply and delivery sale supply separately. The results show that usually price elasticity of wood supply is positive in both short-run and in long-run. The expected price variable’s effect on wood supply is negative. The results indicate that estimated short-run elasticities of supply are much greater than in earlier studies. This is because this research uses monthly data where as earlier studies have used quarterly or annual data. The estimated long-run elasticities of supply witch describe the reactions to economic trend are in the same magnitude with earlier studies. There were remarkable differences between standing sale models and delivery sale models. In the short-run delivery sale models price elasticities of supply were much smaller than in standing sale models. In the long-run the results were opposite. The results also show that there are remarkable differences between the supplies of round wood on different price areas. This result strengthens earlier research results on regional market differences in Finnish pulpwood supply.