Browsing by Subject "timber sales contracts"

In this research it was studied whether non-industrial private forest owners are interested in using timber sales contracts which pricing is based on the nominal stumpage price indices published by the Finnish Forest Research Institute. In addition, it was studied, whether forest owners’ background and objectives of ownership affect the forest owners’ attitudes towards this type of timber sales contracts. Six different models of timber sales contracts were created for the research purposes. The Data consists of 16 non-industrial private forest owners from southern Finland who were interviewed with a semi-structured interview and a questionnaire. Theoretical sampling was used to select different forest owners with respect to their age, profession, gender, domicile and amount of forestland owned. The results suggest that forest owners can be classified into three groups with respect to their interest in a certain contract model. The groups are: risk takers, active sellers and investors. Risk takers were interested in the contract models which allow them to speculate with the future developments of the prices. Risk takers were typically absentee owners owning relatively small-sized forest holdings. Their dependency on forestry income was typically relatively small. Active sellers typically owned large forest holdings and were usually more dependent on timber sales income known with certainty. They were also familiar with the timber selling process which partly explains why they were usually less interested in the models. Investors were typically only interested in the contract models that allowed them to avoid or minimize risk related to the timing of timber sales. Even though timber buyers nowadays offer various types of contracts, it would benefit the timber markets as a whole if there were more flexible nad transparent ways to tailor timber sales contracts for the different types of forest owners. This would have impact especially to absentee owners owning small-sized forest holdings, who either are uncertain on the timing of the sale or appreciate opportunities to speculate with the stumpage price developments. Standardizing the pricing methods of the contracts would enhance the transparency of the pricing of the contracts and increase trust in the whole selling process.