Wednesday, February 27, 2013

Climate change may cause severe loss in the economic value of European forest land

Abstract:
European forests, covering more than 2 million km2 or 32% of the land surface1, are to a large extent intensively managed and support an important timber industry. Climate change is expected to strongly affect tree species distribution within these forests2, 3. Climate and land use are undergoing rapid changes at present4, with initial range shifts already visible5. However, discussions on the consequences of biome shifts have concentrated on ecological issues6. Here we show that forecasted changes in temperature and precipitation may have severe economic consequences. On the basis of our model results, the expected value of European forest land will decrease owing to the decline of economically valuable species in the absence of effective countermeasures. We found that by 2100—depending on the interest rate and climate scenario applied—this loss varies between 14 and 50% (mean: 28% for an interest rate of 2%) of the present value of forest land in Europe, excluding Russia, and may total several hundred billion Euros. Our model shows that—depending on different realizations of three climate scenarios—by 2100, between 21 and 60% (mean: 34%) of European forest lands will be suitable only for a Mediterranean oak forest type with low economic returns for forest owners and the timber industry and reduced carbon sequestration....
Figure 4 illustrates the development of LEV for European forest land for an interest rate of 2% for all three scenarios. For the A1B scenario, the LEV decreases by almost 30% from over euro3,280 ha−1 in the year 2010 to around euro2,350 ha−1 by the year 2100. For scenario B2 the decrease is lower and changes only marginally after the year 2070, whereas A1FI reaches the lowest of all values. The decrease is due to the loss of suitable area of productive species, mainly Norway spruce and Scots pine. Mediterranean oaks that occupy more than 30% of the total area by 2100 (scenario A1B) account for only 4% of the LEV. Norway spruce makes up for more than 45% of the economic value while occupying about 15% of the total area. Applying the difference in LEV (2010–2100) of around euro930 ha−1 (Fig. 4) to the 206 million hectare forest area in Europe outside Russia1 (for which our model is parameterized) results in an overall forest-land value loss of more than euro190 billion under the A1B scenario by the year 2100. As LEV is sensitive towards a change of the interest rate (i), the loss of land value ranges greatly, from over 80 billion for i = 3%(2100) to almost 530 billion for i = 1% (2100) for scenario A1B. For B2 the values for 2100 range from 60 (i = 3%) to 340 billion (i = 1%) and for A1FI from euro100 to 680 billion (see Supplementary Tables S9 and S10).
Figure 4: Relative values (2010 = 100%) of the LEV 2010–2100 for 3 scenarios with 2% interest rate. 
Development of the relative values (2010[thinsp]=[thinsp]100%) of the LEV 2010-2100 for three scenarios with an interest rate of 2%.
Absolute values in Euros for price–cost relations of the year 2010
by Marc Hanewinkel 1, Dominik A. Cullmann 2, Mart-Jan Schelhaas 3, Gert-Jan Nabuurs 4 & Niklaus E. Zimmermann 5
1. Research Unit Forest Resources and Management, Swiss Federal Research Institute WSL, Zuercherstrasse 111, 8903 Birmensdorf, Switzerland and Institute of Forestry Economics, University of Freiburg, Tennenbacherstr. 4, 79106 Freiburg, Germany
2. Department of Biometrics and Informatics, Forest Research Institute of Baden-Wuerttemberg, Wonnhaldestr. 4, 79100 Freiburg, Germany
3. Alterra, Wageningen University and Research Centre, PO Box 47, 6700 AA Wageningen, Netherlands
4. European Forest Institute, Torikatu 34, 80100 Joensuu, Finland
5. Research Unit Landscape Dynamics, Swiss Federal Research Institute WSL, 8903 Birmensdorf, Switzerland
Nature Climate Change www.nature.com/nclimate/journal/
3, 2013, pages 203–207
Published online 23 September 2012

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