Exploring Georgia's wood products [Apr. 2011]

October 2009

Page 1 of 3

A Product of the Forest Utilization Department

April 2011

Financial Benefits of Pine Plantations

In This Issue...

Three new fact sheets are available online at www.GaTrees.org:

Financial benefits of

1

pine plantations

Does Reforestation Pay? Loblolly Pine for Traditional Products examines the financial performance

REAP now accepting applications

1 of loblolly pine plantations established in the upper coastal plain of Georgia with and without pine straw and hunting lease revenue. On sites with average productivity, the addition of pine straw and

BCAP deadlines

1 hunting lease revenue increased rate of return from 9.96% to 12.23%.

EPA comments due May 5th
SC export conference May 24th
Casualty loss for fire-damaged timber

Does Reforestation Pay? Slash Pine for Traditional Products examines the financial performance of 2 slash pine plantations established in the lower coastal plain of Georgia with and without pine straw
and hunting lease revenue. On sites with average productivity, the addition of pine straw and 2 hunting lease revenue increased rate of return from 8.53% to 12.01%.
2 The results of both of these analyses indicate that landowners still have attractive options for pine plantation management in Georgia.

Forest Utilization Staff
Nathan McClure Department Chief 478.951.4548 nmcclure@gfc.state.ga.us
Risher Willard Forest Products Marketing 912.739.4734 rwillard@gfc.state.ga.us
Joshua Love Carbon/Ecosystem Services 706.437.6961 joshl@gfc.state.ga.us
Dru Preston Carbon/Forest Product Certification/Biomass Suppliers 478.751.1746 dpreston@gfc.state.ga.us

An Analysis of the Feasibility of Forest Biomass Production from Pine Plantations in Georgia seeks to answer the question: "At what price for wood biomass will landowners make changes in forest management in order to increase biomass supply to renewable energy producers?" Our analysis indicates that biomass stumpage will need to rise (between $17 and $22 per green ton) before dedicated pine biomass plantations become financially attractive. However, biomass produced in conjunction with traditional forest products in high-density plantations becomes feasible at much lower stumpage levels ($8-$10 per ton).

REAP Funds Now Available for FY 2011
The Rural Energy for America Program (REAP) is now accepting applications for grants and guaranteed loans for the development and construction of renewable energy system, and grants for energy efficiency improvement projects, energy audits, and for conducting renewable energy system feasibility studies.
For more information contact: J. Craig Scroggs USDA Rural Development Energy Coordinator 770-267-1413 ext. 113 craig.scroggs@ga.usda.gov

BCAP: Upcoming Deadlines
May 27, 2011 -- Deadline to submit project area proposals to the state FSA office.
June 10,2011 -- Deadline for state level review of submitted project area proposals.
June 24, 2011 -- Deadline for national review and determination of need for additional environmental review of submitted proposals.
For more information contact: Anna Bramblett, FSA BCAP Specialist 706-546-2256 ext. 4 Anna.Bramblett@ga.usda.gov

Comments to US EPA
Forest product companies that use biomass for energy and forest landowners should consider submitting comments to US EPA on their deferral of regulating biomass emissions from stationary sources. Comments should identify Docket ID No. EPAHQOAR 20110083 and can be sent to GHGbiogenic@epa.gov. The GFC is submitting comments that address the following issues related to this action:
Agreement with deferral of regulating carbon emissions from stationary biomass sources A permitting requirement for small biomass facilities will significantly impact the forest products industry negatively The beneficial impacts of new markets for wood and biomass on reforestation and related carbon sequestration should be considered Utilizing the business-as-usual baseline approach is very questionable in the US South because of market impacts, current forest demographics, and other unknowns The use of a categorical exclusion for biomass is preferred There are many problems with regulating emissions based on specific feedstock type and this approach is not recommended
Deadline for comments is May 5th. Additional information on
EPA's proposed action can be seen at http://
www.regulations.gov/#!documentDetail;D=EPA-HQ-OAR-2011-
0083-0001 .

Casualty Loss from Fire-Damaged Timber
Photo Credit: Chip Bates
REMINDER - Landowners should document casualty losses of timber damaged by the recent wildfires. Losses can be claimed as deductions when calculating Federal income taxes up to the amount of adjusted timber basis less any income from salvage operations.

SC Export Conference Set for May 24
The South Carolina Forestry Commission will be hosting the Seminar on Growing Wood Exports May 24, 2011 in Newberry, South Carolina. The seminar will focus on fundamental issues of exporting along with presentations in key export areas: wood chips, logs, poles, and lumber.
There will be discussions on top export markets for forest products from the Southeast as well as discussions on logistics, financing and resources available to exporters.
The keynote address will be given by Dr. Urs Buehlmann, Virginia Tech, Department of Wood Science and Forest Products. Bruce Hoffman, Kapstone Charleston Kraft LLC will be the luncheon speaker.
For further information please visit the following weblink to the conference: www.state.sc.us/forest/be52411.pdf.

It is advisable to use a professional forestry consultant and/or tax advisor when appraising the actual loss incurred.
More information on tax treatment of casualty losses in timber can be found at http://gatrees.org/ForestManagement/ documents/CasualtyLossandInvoluntaryConversion.pdf and general information on timber tax treatment can be found at http://gatrees.org/ForestManagement/TaxPlanning.cfm .
UPCOMING EVENTS
Southern Forest Products Association Annual Meeting August 9--10, 2011 Atlanta, GA
www.sfpa.org/Meetings/SFPAMeetings.htm
Southeast Bioenergy Conference August 9--11, 2011 Tifton, GA www.sebioenergy.org