Re: word problem

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• Subject: Re: word problem
• From: Ted Bilek <t.bilek@FORE.CANTERBURY.AC.NZ>
• Date: Fri, 8 Mar 1996 17:29:45 +1300
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Dear David,

What an interesting problem for a Friday afternoon.  I should have been
doing other things, but it was a fun thing to tackle.

I realize I'm probably not the first with an answer.  In addition, I'm not
sure if my answer is correct.  I've never done a problem like this.  I
should have taken a forest products course as part of my B-School degree.
None the less, as a typical economist I forged ahead in the dark, groping
my way blindly for an answer, ignoring everything I could not see.

I used the Forest Products Lab's, Wood as an Engineering Material as a
source for conversion data.  I had to do several conversions from imperial
into metric come up with an answer.  Since I've never done a problem like
this, I don't know whether I did either the basic calculations or the
conversions correctly.

If I did get the correct answer, please let me know.

Thanks again!

Ted

>
>(1) Which age wood is worth more to this landowner?
The 15-Year old, (Assuming that the question relates to total sale value
and ignores growing costs.  Also ignored is relative size and growth of the
trees, although I would suspect that she may have done better by possibly
production thinning the 40-year old trees and growing the remainder on a
sawlog rotation).  As an aside, is $80/ton a realistic price for you?  Here
we're looking at around NZ$50/tonne (about US$28.50/tonne) delivered.
>
>(2) In total, how much additional $ does she get for this age wood?
>       $85,923 - $81,566 = $4,357
>
>(3) Which age wood is worth more to the pulpmill?     THE 40-YEAR OLD
>
>(4) How much more (%) is this age wood worth to the pulpmill?
        ((3.125/2.4)-1)*100 = 30.2%
>

My spreadsheet methodology follows.

                              15 years         40 years
Sale Volume (m^3)                1000             1000

Density (lbs/ft.^3)              67.05           63.65  From FPL Table 3-7,
                                                        interpolated.
Density (lbs/m^3)                2,368           2,248
Density (kg/m^3)                 1,074           1,020

Total Sale (kg)              1,074,038       1,019,575
Total Sale (tonnes)              1,074           1,020

                                                             Difference
Sale Value                 $    85,923     $    81,566     $      4,357

Dry weight (kg)                429,615         509,788

Pulp weight (kg)               206,215         254,894

Pulp cost ($/kg)           $    0.4167     $    0.3200
                                                              Pct. Diff.
Pulp volume (kg/$)               2.400           3.125            30.2%


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    | Ted Bilek, Forestry Economics                     |
    | University of Canterbury, School of Forestry      |
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