Economy and policy of pre–commercial thinnings in Lithuanian private forestry

Sammanfattning: This thesis investigates how well does pre-Commercial thinnings (PCT) match silvicultural requirements in Lithuania as well as how adequately are the policy instruments steering the application of thinnings. Analysis is carried in three steps. First, 15 selected sample stands were assessed in the central part of Lithuania. According to the regenerations projects, prevailing tree species in all stands should have been spruce that is commercially important target tree species in Lithuanian silviculture. Results revealed that in none of 15 stands pre-commercial thinnings were performed as required by legislation. Only two stands showed some marks of thinnings. As the second step, economic assessment mostly concerned with calculations for potential economic result of PCTs in four selected model stands. Calculations were made employing methodology widely used in Scandinavian countries. The study compares cash flows, net present values and internal rates of return between treated and untreated stands. The results revealed that PCT’s pays off already at the age of commercial thinnings, and significant economic gains (IRR > 4%) are achieved, when considering the period from PCTs until the end of forest rotation. Lastly, relevant regulative, economic and informational (persuasion) policy instruments were evaluated. Forest legislation was reviewed to assess the regulatory framework. Pre-Commercial thinnings have been specified as a mandatory forest management measure in Regulations for forest fellings already in 2010, but they still were ignored by private forest owners. Control of thinnings is very contradictory due to discrepancies between regulations in different acts. Analysis of economic policy instruments was mainly concentrated on European Unions’ (EU) structural funds. Subsidies from EU funds could be easily reclaimable; however some of the requirements and procedural aspects of the application process are not well appreciated by private forest owners. This inhibits the use of such support system. The main issues are: prohibition to perform thinnings by owners themselves, relatively small percent of PCT expenses covered and too long and in some cases messy administrative process before support reaches applicant. Interviews with officers from Regional Environmental Protection Departments as well as private forest owners uniting associations confirmed that courses for private forest owners could be the most important informational policy tool for promotion of best practices. Analysis also revealed that owners are not well informed about such courses and participation is still weak. Possible reasons are further discussed.