AssessiMg Socioeconomicmpacts of Climate Change

on US Forests, Wood-Product Markets, andForest Recreation

LLOYD C. IRLAND, DARIUS ADAMS, RALPH ALIG, CARTER J. BETZ, CHI-CHUNG CHEN, MARK HUTCHINS,

BRUCE A. McCARL, KEN SKOG, AND BRENT L. SOHNGEN

S cientists have suggested that future climatechange wil l s ignif icant ly affect the dis tr ibut ion, condi-

t ion, species composit ion, and productivi ty of forests (Aberet al. 2001, Dale et al. 2001, Hansen et al. 2001, McNulty andAber 2001). These biological changes wil l set in motion com-plex regional changes in supplies of wood to sawmills and pa-per mills, producing effects on market prices. In turn,landowners and consumers will adapt in ways that cause fur-ther feedback effects on forests. For some time, social scien-t is ts have been assessing the manifold implicat ions for socialand economic welfare. In particular, they have been examin-ing ways in which price responses to changing supplies causetimber growers, sawmills and pulpmills , producers, and con-sumers to adapt. This paper reviews this research, focusing onthe forest benefits of t imber production and outdoor recre-at ion. Analyzing these sectors involves quite different meth-ods and issues because wood products are primarily pro-ducer goods that reach consumers through a complexmarketing chain, whereas forest-recreation experiences are di-rectly consumed by visitors. As part of the national assessmentof climate change, a socioeconomic team (the authors of thisart icle) assembled exist ing data and conducted l imited newanalyses. In this short summary, many important topics mustbe left aside.

THE EFFECTS OF CLIMATE CHANGE ON

FORESTS WILL TRIGGER MARKET ADAPTA-

TIONS IN FOREST MANAGEMENT AND IN

WOOD-PRODUCTS INDUSTRIES AND MAY

WELL HAVE SIGNJFICANT EFFECTS ON

FOREST-BASED OUTDOOR RECREATION

In this paper we discuss the problems of projecting socialand economic changes affecting forests and review recentefforts to assess the wood-market impacts of possible cli-mate changes. To illustrate the range of conditions encoun-tered in projecting socioeconomic change l inked to forests, weconsider two markedly different uses: forest products marketsand forest recreation. In the case of forest products, we use anexist ing forest-sector model to arr ive at new simulat ion resultsconcerning the impacts of climate change. The impact of

Lloyd C. lrland (e-mail: irland@aol.com) is president of The lrland Group, Winthrop, ME 04364. Darius M. Adams is Professor of Forest Economics

a t O r e g o n S t a t e U n i v e r s i t y , C o r v a l l i s , O R 9 7 3 3 0 . R a l p h A l i g i s R e s e a r c h F o r e s t e r a t U S D A F o r e s t S e r v i c e , P a c i f i c N o r t h w e s t R e s e a r c h Station, Forestry

S c i e n c e s L a b , C o r v a l l i s , O R 9 7 3 3 1 . C a r t e r J . Betz i s O u t d o o r R e c r e a t i o n P l a n n e r a t U S D A F o r e s t S e r v i c e , S o u t h e r n R e s e a r c h S t a t i o n , A t h e n s , G A

30602-2044. ChiChung Chen is Assistant Professor at National Chung Hsing University, Taichung, Taiwan. Bruce A. McCarl is Professor of Agd-

c u l t u r a l E c o n o m i c s a t T e x a s A & M U n i v e r s i t y , C o l l e g e S t a t i o n , T X 7 7 8 4 3 2 1 2 4 . M a r k H u t c h i n s i s P r o j e c t E n g i n e e r a t Sno-Engineering, I n c . , Hanover,

N H 0 3 7 5 5 . K e n S k o g i s P r o j e c t L e a d e r a t U S D A F o r e s t S e r v i c e , F o r e s t P r o d u c t s L a b o r a t o r y , T i m b e r D e m a n d a n d T e c h n o l o g y A s s e s s m e n t - R e s e a r c h ,

M a d i s o n , W I 5 3 7 0 6 . B r e n t L . S o h n g e n i s A s s o c i a t e P r o f e s s o r a t O h i o S t a t e U n i v e r s i t y , A g r i c u l t u r a l , E n v i r o n m e n t a l , a n d D e v e l o p m e n t E c o n o m i c s ,

C o l u m b u s , O H 43210-1067. 0 2 0 0 1 A m e r i c a n I n s t i t u t e o f B i o l o g i c a l S c i e n c e s .

2001/ Vol. 51 No. 9 l BioScience 753

climate change on recreation has received less at tent ion; herewe consider a case study of downhil l ski ing. Other importantforest values were not treated explicit ly in this research. Ourprimary emphasis is on methods and issues in the socioeco-nomic assessment process. Our effort5 may be viewed as anexercise in human ecology, studying complex interactions be-tween human societies and their fore: ts . We close with sug-gestions for future research.

Projecting social change:Climate change will affect forest gro\vth, inventories, andharvest levels slowly, over many decades. The specific forestchanges at a regional scale are highI), uncertain. These bio-logical changes will affect recreation, wood-product mar-kets, and other forest benefits, all with differing lag times. Un-certainties concerning levels of popuia {ion, incomes, spendingpatterns, per capita consumption of products, and interna-tional trade become increasingly severe as longer t ime peri-ods are considered. Benchmark projections of population, forexample, involve considerable uncertainty (Figure 1). More-over, it is difficult to explicitly model how decisionmakersmight incorporate expected changes in cl imate in their man-agement decisions. Consequently, economic models to datehave relied heavily on assumptions. They necessari ly incor-porate the assumptions employed in the underlying vegeta-tion models, which typically do not explicitly incorporate for-est management (e.g. , pine planting in the South).

North America is the world’s leading producer and con-sumer of wood products. The United States depends onCanada for 35% of its softwood lumber and more than halfof its newsprint. US exports of kraft [Taper, hardwood lum-ber, chips, logs, and other products arc’ substant ia l . Model ingUS wood-product markets, then, invol!.es assumptions aboutfuture supplies, demands, and competi t iveness among the ma-jor t rading partners of the United States.

The current generation of models for assessing the eco-nomic effects of climate change, however, provides consid-erable insight into the likely magnitudes of social impacts andil lustrates the possibi l i t ies for market-mediated responses tothose impacts (Mendelsohn and Neumann 1999). Assess-ments of the impacts of cl imate change must l ink a series ofmodels deal ing with populat ion and demand determinants ,resource conditions, product markets, trade, and consumerand producer welfare. The modeling and data uncertaintiesat each stage of the analysis mult iply in their effects on theresul ts .

Studies of wood-product marketadaptation to ecological changesA considerable economic li terature has developed, analyzing(1) adaptation in land management and in product marketsand (2) the role of forest management in carbon (C) se-questration. Economic studies typically begin with steady-state, doubled-CO, climate-change predictions-from $ev&. --cl imate models (general circulation models, or GCMs). Eco-logical models use these result to predict the steady-state eco-

754 Bioscience l / Vol. 51 No. 9.. II Y I-7:: I-.:

logical consequences. Economists develop scenarios of theecological changes and introduce those effects into their eco-nomic models, which then simulate how markets are likelyto respond. Because the GCMs and ecological models are spa-t ial ly explici t , economic models can capture regional effects.Different US and world regions may gain or lose advantagein t imber growing and wood production with cl imate change,

Past studies employ a variety of assumptions about the eco-logical effects of assumed future climate change (Table 1).Within the range of effects examined, however, one conclu-sion appears warranted: Adaptation in US t imber and wood-product markets will offset some of the potential negative ef-fects of climate change. The wood products sector may evenbenefit from the changes in the sense that, under climatechange, the net change in consumer plus producer economicbenefi ts may be posi t ive (Winnett 1998, Sohngen and Sedjo1998, Sohngen and Mendelsohn 1998, Sohngen and A&g2000).

.

Adaptation in land management. Binldey (1988)first explici t ly l inked the ecological effects of cl imate changewith a timber model. He considered only changes in borealforests and did not predict market ef&ts in the Uni ted Sta tes .More recently, Joyce et al. (1995) linked the TEM biogeo-chemical cycle model (Melillo et al. 1993) to the TAMMINAPAP/ATLAS model to project how US timber marketsadapt to changes in forest production (Table 1). Perez-Gar-cia et al. (1997) use the same ecological and climate modelsas Joyce et al. (1995) in a global analysis (Table 1). The authorstrace the economic effects through to the wood-processing sec-tor. US lumber and plywood production increases under allscenarios, while pulpwood production decreases under somescenarios. Overall , consumers and mill owners would gain wel-fare (profits for mill owners) during climate change, whilelandowners would lose welfare.

Sohngen and Mendelsohn (1998) provide results for 36combinations of climate (2 x CO,), biogeochemical, andbiogeographical changes in forests from VEMAP (Vegeta-tion/Ecosystem Modeling and Analysis Project) members( 1995; Table 1). They focus explicitly on adaptation in fore&-land management under the assumption that wood-processing capital shifts to regions with economic advan-tages in timber growth. Forest area change is captured witheither a dieback scenario (King and Neilson 1992) or a less dra-matic regeneration scenario. Markets generally adapt to short-term increases in mortality by reducing prices, salvagingdead and dying timber, and replanting new species that arefavorably adapted to the new climate (Table 2). Salvage dur-ing dieback ranges from 50% to 75%, depending on man-agement intensi ty. Total benefi ts to producers plus consumersrise in all scenarios considered. Comparisons of carbon fluxespredicted by this model with those cited in earlier natural-adaptat ion s tudies by King and Neilson (1992) and Smith andShugaitfl993)suggest that market adaptation can reduce orreverse the pstential forest carbon fluxes caused by climatechtige~h~the -United States;.

Adaptation in product markets. Adap-tat ions may include using al ternat ive species in U.S. population projections

the manufacturing process, changing the na- 700ture or location of capital and machinery, 650 - Hiahchanging reliance on imports or exports, oradopting new technologies. Previous studies

600 -

implic i t ly capture subst i tut ion of end products 550 -

in markets because they incorporate market re- 500 -lat ionships for t imber and products . The mod- 450 -els treat investments in capital over time dif- 400.-ferently. The model of Sohngen andMendelsohn (1998) assumes that mill capital

350 -

and machinery will adapt based on correct 300 -

anticipation of the future impacts of climate 250 -change. Joyce et al. (1995) assume that capital 200and machinery will adjust more slowly. HOWrapidly mil l investments respond to changes in Isupply and t imber pr ices s t rongly a f f e c t i end-product price behavior.

1990-2100.

New technologies, already emerging in response to mar- products. These new products often enable the industry toket changes, represent another method of adapting to cl imate draw on more widely abundant species of trees that are alsochange. For example, new adhesives have led to new classes closer to end-use markets. Plastics have continued to dis-of wood panels and composites, which have displaced older place t radi t ional uses of wood, with innovations such as vinyl

Table 1. Four t imber market models that have been usedfor c l imate ana lys i s .

TAMM/NAPAP/ATLAS CGTM FASOM V E M A PW-d by (Used by (Used by (Used by Sohngen and

Joyce et al. PerezOarcia et al. Burton et al. MendelsohnAttribute 1995) 1997) 1998) 1998)

Timber modal attributeT h e o r y Spatial equilibrium S p a t i a l e q u i l i b r i u m D y n a m i c o p t i m i z a t i o n D y n a m i c o p t i m i z a t i o nP r o j e c t i o n m e t h o d S t a t i c s i m u l a t i o n static simulation O p t i m a l c o n t r o l O p t i m a l c o n t r o lH a r v e s t m e c h a n i s m WA WA O l d e s t t i m b e r O l d e s t t i m b e rG l o b a l s c o p e US-Canad: G l o b a l U S - C a n a d a G l o b a lR e g i o n s - 8 -40 -9 4T r a c k s r e g i o n a l t r a d e Y e s Y e s Y e s N oM a r k e t s t r u c t u r e Multileve M u l t i l e v e l Log S t u m p e g eC a p i t a l a d j u s t m e n t A d a p t i v e A d a p t i v e R a t i o n a l R a t i o n a lL a n d m a n a g e m e n t E x o g e n o u s E x o g e n o u s E d o g e n o u s E n d o g e n o u s

Climate and ecological change model attributeC l i m a t e s c e n a r i o s 4 4 N o n e e x p l i c i t 2B i o g e o c h e m i c a l m o d e l s 1 m o d e l (TEM) 1 m o d e l (TEM) N o n e e x p l i c i t 3 models (VEMAP

m e m b e r s 1 9 9 5 )

zoorest p r o d u c t i v i t y

3 i o g e o g r a p h i c a l m o d e l s

A n n u a l g r o w t h c h a n g e s A n n u a l g r o w t h c h a n g e slinked to NPP linked to NPP

N o n e N o n e

A s s u m e d c h a n g e s i na n n u a l g r o w t h

N o n e

A n n u a l g r o w t h c h a n g e sl i n k e d t o V e g e t a t i v ec a r b o n

3 m o d e l s ( V E M A Pm e m b e r s 1 9 9 5 )

West s p e c i e s m i g r a t i o n N o n e

)ynamic c l i m a t e c h a n g e L i n e a r

fears to doubling CO, 75

fears in model run 5 0

d o t e : NP~ n e t p r i m a r y p r o d u c t i v i t y .

N o n e

L i n e a r

75

50

N o n e

C o m p o u n d e d

60

60

Dieback a n d r e g e n e r a t i o n

L i n e a r

70

150

September 2001 / vol. 51 No. Biosc ience 755

Articles

Table 2, Four studies of the economic ejjects of climate change scenarios on timber markets.

Study Joyce et al. (1995) Perez-Garcia (1997) Burton et al. (1998)Sohngen and

Mendelsohn (1998)

P r o d u c t i v i t yF o r e s t a r e a

Inventoriesi T i m b e r p r i c e s

c o m p a r e d w i t h b a s e l i n eM a r k e t w e l f a r e

G e n e r a l l y i n c r e a s e sN o c h a n g eInc rease

L o w e rN o t g i v e n

G e n e r a l l y i n c r e a s e sN o c h a n g eInc rease

L o w e rI n c r e a s e d

I n c r e a s e s o r d e c r e a s e sN o c h a n g eI n c r e a s e s o r d e c r e a s e s

Inc rease o r dec reaseI n c r e a s e d o r d e c r e a s e d

I n c r e a s e s o r d e c r e a s e sLong-tem7 i nc reaseL o n g - t e r m i n c r e a s e

L o w e rI n c r e a s e d

siding, plast ic decking, and plast ic and wood fiber compos-ites. Increased recycling of paper and pallets has alreadydampened t imber demand New technologies have also helpedmills produce more product value from a given tree; as thistrend continues, the forest-based economy will be more re-silient in the event that one of the future dieback scenariostranspires .

The studies described above focus on the United States. Ef-fects on Canada’s forest , a major source of US wood products,have also been reviewed (Van Kooten and Arthur 1989, VanKooten 1995). Current research considers primarily the one-way impacts of a changing climate on forested ecosystems andconsequently on the economy. A truly integrated analysiswould fully incorporate feedbacks among the ecological sys-tem, insects, diseases and invasive plants, the economic sys-tem, carbon flux, and climate (see, for example, Goldewijk etal. 1994). One such feedback is the role of forests and woodproducts in carbon storage.

Using forests to store carbon. A number of authorshave suggested that forests could be used to increase thequantity of carbon stored in terrestrial ecosystems (Sedjo1989, Winjum et al . 1998, Joyce and Birdsey 2000; for recentreviews, see Sedjo et al . 1997, Irland and Cline 1998). Manystrategies have been examined (Adams et al . 1993,1999, Al iget al. 1997, Birdsey et al. 1999, Parks and Hardie 1995, Stavins1999). Among these strategies are the fol lowing:

. set t ing aside exist ing forests from harvest , and con-trol l ing wildfires

. i n c r e a s i n g c a r b o n b u i l d u p in forests by convert ing mar-ginal agricultural land to forests (carbon plantations,forest-product plantat ions, or joint-product planta-t ions)

l enhancing forest management

. substituting wood products for more energy-intensiveproducts (Skog et al. 1996)

. planting trees in urban regions to moderate urbanclimates

A substantial pool of carbon resides in forest products inuse, as in houses. Heath et al. (1996) estimate that carbonstored in products harvested since 1900 equals 3.7 Pg carbon;Skog and Nicholson (1998) suggest that this amount is closer

-. ^ . a. . . .1.... -7nnr IT,-, c, A,.. n

to 2.7 Pg. Est imates of net annual accumulation of carbon inwood products and landfills in the early 1990s ranged from37 Tg per year (Heath et al. 1996) to 61 Tg per year (Skog andNichoIson 1998). Estimates by Plantinga and Birdsey (1993)and Skog and Nicholson (1998) suggest that annual s toragein products and landfills will grow to approximately 70 Tg peryear by 2040. Approximately 29% of paper is currently recy-cled by domestic mills. The USDA Forest Service estimates thatthis share may rise to 45% by the year 2040 (Haynes et al.1995). Increasing the recycling rate to 60% by the year 2040could reduce carbon emissions in the paper industry by 36 Tgcarbon per year and increase carbon storage in forestedecosystems by 8-14 Tg per year by lowering t imber harvests(Skog et al. 1996). These amounts may not be large relativeto total US emissions (1367 TG per year in 1990), but they arelarge relative to other options for C mitigation. Analysisworldwide has been conducted by Wmjum et al. (1998).

Although considerable at tention has been given to carbonstorage issues (Watson et al . 2000), there has been no com-prehensive social-impact assessment measuring consumer,producer, and environmental benefits. The future role of woodbiomass as an energy source depends on oil prices and publicpolicies and was not evaluated in the models reviewed here.

Assessment simulation results: FASOMA study of the effects of global climate change on forestryshould be based on accepted future scenarios for forest yield,but definitive scenarios have not yet emerged. Therefore, weanalyzed four forest-growth scenarios based on paired ap-plications of two global climate models and two ecological-process models (EPMs). We estimated how baseline forestgrowth will change because of climate change. To assess theforest-yield scenarios, we used the FASOM model, as docu-mented in Adams et al . (I997),Alig et al. (1998), Sohngen andAlig (2000), and Joyce and Birdsey (2000). Given a climate-change scenario, the FASOM model projects forest- and agri-cultural-sector production, consumption, prices, and eco-nomic welfare. To deal with competition for land, FASOMincorporates both sectors . FASOM is a mult iperiod, no$in-ear, price-endogenous, mathematical-programmirig eco-nomic model that provides 120-year projections. Values ofnonwood or noncommodity attributes of the forest are notconsidered. Products comprise f&wood, sawtimber, andpulpwood. On the forest s ide, FASO&l simulates

: I. . . . . > ;, Articles

l changes in timber inventory on private land

l manufacturers’ adjustments in timber-productproduction

l consumers’ adjustments in consumption

l forest landowners’ conversion of forest to (or from)agriculture

l landowners’ adjustment of forest managementintensi ty and rotat ion age

Harvest on public lands and the net import of wood andwood products from Canada are taken as exogenous. In thisanalysis, Canadian imports were adjusted by the average per-centage change in harvest observed in comparable regions onprivate lands in the United States to reflect the impacts of cli-mate change. The impacts of climate on forest productivity(see Aber et al. 2001) were simulated using two biogeo-chemical models (EPMs): TEM (Meli l lo et al . 1993, McGuireet al. 1992) and CENTURY (Parton et al. 1987,1993). Possi-ble effects of climate change on insects, diseases, invasivespecies, or fire regimes were not considered (Dale et al. 2001).

The four scenarios represent combinations of the twoGCMs and two EPMs:

. Hadley-TEM (climate change from the HadleyGCM, changes in forest growth rate from the TEMEPM)

. Hadley-CENTURY (climate change from the HadleyGCM, changes in forest growth rate from the CEN-TURY EPM)

+ . CCC-TEM (climate change from the CanadianGCM, changes in forest growth rate from the TEMEPM)

l CCC-CENTURY (climate change fromthe Canadian GCM, changes in forestgrowth rate from the CENTURY EPM)

In contrast to the equil ibrium cl imate sce-narios used in earlier forest sector analyses(Joyce et al. I 995, Sohngen and Mendelsohn1998), transient climate scenarios were usedfor this assessment. The climate under in-creased carbon dioxide was simulated annu-ally from 1895 to 2 100; the EPM models pro-jected vegetation carbon annually over thisperiod. Forest floor and soil pools were notsimulated. For each grid cell, we computed theannual change in vegetation carbon for eachmodel projection, converted these changesto a lo-year moving average, and used thesechanges to influence timber yields in FASOM.The ecosystem classification for each grid cell(VEMAP members 1995) was mapped to themajor forest type (e.g., Joyce et al. 1995). The

lo-year moving average ch&ges in vegetation carbon werethen averaged spatially across all grid cells for each foresttYPe-

Changes in vegetation carbon varied for each region becauseof the regional cl imate and the changes in climate projectedby the Hadley and Canadian models. For example, in theNortheast, the oak-hickory type has the largest change in an-nual growth rate-an increase of about 0.3% by 2 100 (Fig-ure 2). These changes in vegetation carbon by forest type aremapped into hardwood and &wood fbrest types and are usedto change timber growth for the nine regions modeled inFASOM (see Adams et al. 1996, Alig et al. 1997, Mills et al.2000).

Timber growth increases under all four cases in most re-gions for most decades. Growth increases over IO-year peri-ods are relatively small . For most scenarios, species, and re-gions, decadal increases are from 1% to 3% of the prevailinggrowth rate. The most significant declines are for softwoodsand hardwoods in the southeast and south-central regions for2010-2040 for the Canadian-Century case. But growth ratesare higher for all cases, regions, and sptcies in later decades(Figure 2).

The results suggest that the assumed climate change sce-narios, as indicated by these four cases, would be generally ben-eficial for the timber-products sector over the 120-year pro-jection. ‘This result is consistent with findings for theforthcoming agricultural sector of the national assessment. In-creased forest growth translates into higher forest production,as represented by log harvest levels in most cases. By 2 100, in-ventories are sl ightly higher for the climate-change scenarioscompared with the base case (Table 3, Figure 3). Increased for-est growth leads to increased log supply and hence to reduc-tions in log prices that, in turn, decrease producers’ welfare(profits) in the forest sector. At the same time, lower forest-

Examples of simulated change in forestgrowth, Northeastern USA, 2004-2099

0.0032 , 10 . 0 0 3 00 . 0 0 2 80.00280 . 0 0 2 40.00220 . 0 0 2 00.00180 . 0 0 1 80 . 0 0 1 40 . 0 0 1 20.00100.00080.0006 ’ .

ZOO, 1 201, 1 202, 1 2034 1 2044 1 2054 1 2064 1 2074 1 2 0 1 4 1 2 0 2 4 11

2000 2 0 1 0 2 0 2 0 2 0 3 9 2 0 4 8 20% Z O O S 2 0 1 0 *0.* Z O O S

a---- Spruce fir - Maple-beach-birch - Oak-hickory

Source: Century Model, L. Joyce, USDA Forest Service.Note: Changes for white-red-jack pine are identical to spruce-fir, andelm-ash-red maple and aspen-birch are essentially Identical tomaple-beech-birch.

1

Figure 2. Example of s imulated changes in fores t growth, Northeas t and ent ireUnited States , 2004-2009 (fract ional increase over base case) .

September 2001/ Vol. 51 No. 9 - Bioscience 757

Table 3. results for four climate-change scenarios.

Had-T

Percentage change frombase-case projection

Had-VM Can-l Can-VMAP

Welfare (net present value)Forest sector. 2000-2120 0.2 0.1 0.1 0.0Combined agriculture and 0.7 0.7 0.4 0.4

forest sectors, 2000-2120Forest pricePULPSW, avg 2000-2010 0.6 -0.6 -0.6 -0.6PULPSW, avg 2020-2050 3.1 3.1 3.8 3 . 8SAWTSW, avg 2000-2010 -0.4 0.4 0.0 0.0SAWTSW, avg 2020-2050 -6 .4 - 5 . 3 -5 .3 -3 .7Forest production (harvest)PULPSW, avg 2000-2010 0.2 0.2 0.1 -0 .0PULPSW, avg 2020-2050 -3 .1 -3 .0 -3 .3 -3 .1SAWTSW, avg 20002010 0.5 0.4 0.2 0.0SAWTSW, avg 20202050 1.4 0.6 0.8 0.4Timber inventoryNorth, ALLWOOD

2OOO-2010 0.1 0.2 -0 .1 -0 .020202050 -1.3 0.2 -0 .1 -0 .0

South, ALLWOOD2 0 0 0 - 2 0 1 0 0.1 0.1 -0 .1 -0 .02020-2050 0.1 0.1 -0 .1 -0 .0

Land transfers, nationwide’FORCROF? 20002010 3.1 -0 .1 3.1 -0.6FORCROP 2 0 2 0 2 0 5 0 -21 .5 -12 .4 -22 .1 -11 .1MRPAST, 2OOO-2010 -0.4 -1.4 -12 .3 -12 .3FORPAST, 202O-2050 -18 .9 -16 .1 24 .6 32.1CROPFOR, 2OOO-2010 -100 .0 -93 .0 115.3 159.9CROPPOR, 2020-2050 -100 .0 -100 .0 -82 .9 -93 .6PASTK)R, 20002010 21.9 20.6 18.4 18.4PASTF0R. 2020-2060 -89 .1 98 .5 -8 .9 76.7

Note: Only softwoods reported separately, and only North and South illustratevegional projections. PULPSW, softwood pulpwood; SAWTSW, softwood sawtimber;FORCROP forestland changed to cropland; CROPFOR, cropland changed to forest;PASTFOR, pasture changed to forest: FORPAST, forest changed to pasture.

a. Some of the changes here are very large, because the base case valuesare small.

product prices (compared to baseline) mean that consumersgeneral ly benefi t (Table 3) . This pat tern of distr ibutional im-pacts on forestry producers and consumers is also consistentwith results in the agricultural sector. The projected net effecton the economic welfare (producer profits plus consumer sav-ings) of part icipants in both t imber and agricultural marketsis positive (Figure 4).

Land-use changes between forestry and agricultural usesare an important avenue of adjustment to climate-inducedshifts in production. Yields generally increase in both theforest and agricultural sectors in al l four scenarios, al thoughthe pattern between sectors varies substantially. In the Cana-dian scenarios, these shifts are relatively more favorable forforestry profi ts compared with agriculture, while the oppo-site is true in the Hadley scenarios.

Although total forest production generally increases becauseof climate changes under the four scenarios, regional andspecies differences are evident over t ime. Output and inven-tory changes are also poorly correlated. In both the North andSouth, total forest inventories in the near term are variously

larger or smaller than the base case, depending on thescenario (Figure 3): In the longer term, aggregate in-ventories are lower than the base case in all scenar-ios. Across all regions and scenarios, cumulativehardwood output over the full projection period ishigher; softwood production increases only in theHadley GCM cases. In the North, cumulative outputdeclines for all species in both Canadian GCM casesand in the Hadley-TEM case. In the South, in con-trast , output increases in all cases and for both hard-woods and sof twoods.

Compared with the base case, forest-productprices would generally be lower under the climate-change scenarios (Table 3), except for softwood pulp-wood in the long term. Although overal l wood pro-duction is projected to increase, the proportion ofsawtimber (combining both softwoods and hard-woods) is somewhat larger with cl imate change in al lscenarios, species, and regions. This shift in productmix reflects the impacts of accelerated growth on ro-tation age, which is lengthened in the long term forall regions and species. With longer rotat ions comelarger volumes of sawtimber relative to pulpwood.

The effects of global climate change on forestgrowth based on the combined GCM-EPM scenar-ios have a generally positive impact on aggregateeconomic welfare. The projected aggregate marketwelfare impacts (consurners’savings plus producers’profits) from the climate-change scenarios are gen-eralIy not large compared with the baseline, rangingfrom +0.05% to +O.IS% in the forest sector andfrom -i-0.37% to i-0.74% in the combined agricultureand forest markets. Yield increases and price reduc-tions induced by climate change were found to ben-efit consumers but not producers. Thus, the aggre-gate welfare effects mask the distributional shifts

between producers and consumers.

Eflects on forest recreationRecreation is an important use of forest land Leisure-t ime useof forests for outdoor recreation represents a direct interac-tion of people with the environment. Recreation is an ex-tremely broad and diverse social phenomenon with each ac-tivity having its own environmental requirements, so it isdifficult to generalize about climate change effects (Cordell etal . 1999, Wall 1998). We reviewed existing information, seek-ing ideas on how forest-related recreation might be affectedby climate change. Only Iimited understanding about potentialclimatic influences on outdoor recreation has emerged, andmuch of that is more accurately described as informed opin-ion than as science. Much of the work has appeared since themid-1990s. For example, a 1992 National Academy of Sciencesreport devoted only about two pages (out of 900) to outdoorrecreation (NAS 1992).

_.-.. Seasonalityis a major attributqpfmosttou&t~destinations.It affects both the types of recreational activit ies that occur in

__. - - - .,... ._ ..---758 Bioscience l September 2001 / Vol . 5 1 N . 9

Projected U.S. total private land timberinventory by scenario, 2000-2100

(Climate effects scenarios -- plotted only after 2040)

400’ ’2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

. B A S E + Hadley-TEM o t iadley-CENTURYd Canadian-TEM x Canadian-CENTURY

Figure 3. Projected US total pr ivate inventory by scenario , 200&2100(mil l ion cu. f t . ) .

a region and the amount of recreation that takes place. Thatis , individuals who l ive in one place and demand the at tr ib-utes of a certain season are willing to travel to other places thatsupply those seasonal attr ibutes. Classic examples are beachesand ski resorts .

Climate effects may be direct or indirect. Direct effectscan be simply described as those straightforward effects on par-ticipants’ desired demand for outdoor recreation due to ei-ther increased temperatures or changes in precipitation(Loomis and Crespi 1999). The best example of a direct ef-fect is the extension, because of temperature increases, of therecreation season for a number of activities, especially watersports and beach-oriented recreation. Indirect effects, on theother hand, are those impacts arising through changes in the

Florida beaches. Thrwarming of waters mayincrease fish productivity for some specieswhile causing declines or loss of other s ignif-icant species (Schaake 1989, Shaw 1996, BaiIeyand Kerr-Upal 1997, Duk 1997, IISD 1997).

Sustaining coldwater f isheries is a key issue.There is l i t t le doubt that increased temperatureswill s ignificantly reduce available trout habitatand populat ions (Ahn 1997). Brook t rout habi-tat, in particular, is likely to become increasinglylimited and fragmented. A study by the USEnvironmental Protection Agency estimatedchanges in consumer benefits of recreationalanglers from changing water temperatures(Michaels et al. 1995). Warmer temperatures re-sul ted in a net loss in user benefi ts .

In mountainous landscapes (such as theGreat Smoky Mountains National Park), wherescenery and sightseeing are prominent at-tractions, warmer lowland temperatures willtend to attract more people to the relatively

cooler higher elevations. Yet climate change could affect hazeand could diminish the vividness of fall foliage and colordisplays (Bloomfield and Hamburg 1997).

Two recent statistical studies attempted to define the climatesensi t ivi ty of recreat ion vis i ts on a nat ional basis (Loomis andCrespi 1999, Mendelsohn and Markowski 1999). They esti-mated current aggregate days of activity and the economicvalue to visitors, and they projected these variables to 2060(Table 4). The results suggest losses in consumer benefi t forsome activit ies and gains for others. Nonetheless, the analy-sis of the recreation effects of cl imate change is in i ts infancy.Clearly many forms of adaptation can accompany climatechanges, though they may impose higher costs. The impor-tance of recreation as a factor in the quality of life, its economic

quanti ty and quali ty of natural resources used foroutdoor recreation (Loomis and Crespi 1999).Agood example is the potential change in reservoir Predicted change in discounted producer and

levels due to increased evapotranspiration orconsumer benefits from timber products

= 4changing precipitation. Lake levels are a good 2 3i.ndicator of boating quality, SO climate change has z 2

1the potential to indirectly cause shifts in recreation 0

visi ts because of i ts effects on water volumes.ze

-1

Climatic conditions are an essential part of :-2-3

he forest recreational experience. For some ac- F -4

hvities, climate is the most critical aspect of the Z-5-6

setting. Increased temperatures’ will p r o d u c e apositive direct effect for a.IlY summer activity thatwould benefit from an extended season. Beachrecreation, swimming, and boating, often pursuedin forest settings, are some obvious beneficia-

2 -7s -82 -5~p -10

Hadlay- Hadley- Canadian- Cansdlen-TEM C E N T U R Y TEM CENTURY

- Consumerbenefits

- Producerb e n sfits

- Consumer/producer to ta l

ties. Negative effects may also arise, such as greaterbeach erosion (Yohe et aI. 1999). Furthermore,

Note: Benefits are present value of Consumer and producerSurplus discounted at 4% for 2000-2120.

higher temperatures and extended seasons inmore temperate regions may actually reduce the Figure 4. Potent ial change in discounted producer and consumer benefits

r . . 1 .I _ . r *demand for more tropical environments, such as f rom ttmber proctucts (percentage cnange Jrom base case) .

/ Vol. 51 No. 9 l Bioscience 759

‘: ITable 4. E@cfs on recreation visitation and value for CO, doubling scenario (+2S”C and 7% precipitation increase). I

Number of visits (millions)

With no With climateclimate change change

Difference(days)

Percentage Change inchange ebonomk value(days) (millkfw of 1992 dollare)

Forest -based recreat ion( C a m p i n g , h i k i n g , p i c n i c k i n gu n d e r midlevel loss 199 1238.45 1213.56 -24.89 - 2 . 0 -357.00estimate) 20E 2163.52 2119.55 -43.97 - 2 . 0 -658.00

Beach rec rea t ion( B e a c h n o u r i s h m e n t a n dpro tec t ion scenar io ) 199( 191.70 218.65 26.95 14.1 337.90

206( 256.10 292.15 36.05 14.1 451.48S n o w s k i i n g

( D o w n h i l l a n d 199G 155.77 74.35 -81.42 - 5 2 . 3 -1439.50cross-country ) 2060 464.07 222.09 -241.98 - 5 2 . 1 4 2 7 8 . 2 2

Stream recreat ion( S t r e a m f i s h i n g , 19% 191.18 197.83 6.64 3.5 288.27k a y a k i n g , r a f t i n g ) 2060 371.11 383.79 12.68 3.4 555.47

Tota l e f fec t 1990 3809.75 3928.79 199.03 3.1 2748.33,2060 6459.79 6538.91 79.12 1.2 2568.82

Source: Loomis and Crespi 1999, Table 11.2.

impact , i ts obvious cl imate sensi t ivi t ies , and the many localand regional variations argue for a major increase in researchon this topic .

Possible effects of climate changeon the ski industrySkiing is an important use of forested mountain landscapesand a key concern of land-managing agencies. I t displays su-perficial ly straightforward l inks to cl imate regimes. The f irstski areas in the United States were constructed during the1930s. Thereafter , skiing’s populari ty soared, with the num-ber of ski areas peaking during the 1960s and 1970s. Todaythere are considerably fewer ski areas (52 1 a t t h e end of the1998 ski season), and the number continues to decline. Suc-cessful ski areas must now provide high-speed lifts, overnightaccommodations, modem snowmaking and grooming equip-ment, and other amenit ies .

Natural snowfall at western resorts is more dependabIethan a t the eastern resorts. Snowfall in many westerly areas of-ten exceeds that needed for acceptable skiing conditions.Thus, cl imatic variabi l i ty is less important in the west . Nev-ertheless, many western resorts suffered a disastrous ski sea-sons in 1976 and 1977 because of the lack of natural snow. Inaddition, the ability to open early in the season is vital in-dustrywide, and early-season snowfall is not dependable.Thus, machine-made snow plays an important role for ski ar-eas and skiers throughout the country.

Three primary factors influence the abili ty of a ski area tomake snow. Temperature and water availability are directly re-lated to climate; energy is at least indirectly related. Most

_ _ . snowmakers do. not begin operations until temperatures arebelow -2°C and are expected to remain below -2°C for-at least

760 Bioscience l /Vol . 51 No. 9 - - .

four hours. Snowmaking efficiency is inversely related totemperature, so the cost of making an acre-foot of snow at-12°C is cheaper by a factor of 5 than at -2°C. Energy re-quirements are high. For example, at Maine’s Sunday River,annual electricity usage is approximately 26 millionkilowatt-hours, most of which is for snowmaking (Hoffman1998). This translates to nearly $2 million per year just for elec-tr ici ty. Electrici ty costs for early-season snowmaking can beas much as $700 per acre-foot of snow, while midwintersnowmaking can cost $25 per acre-foot A large resort can eas-ily spend more than $100,000 per night making early-seasonsnow.

A higher average temperature in winter would have sev-eral effects. First, the number of hours that temperatureswould exceed -2°C would increase. This would increase theamount of snow melt ing, increase the number of rain events,and decrease the “window” for snowmaking while increas-ing the need for machine-made snow. Ski areas that typicallyhave an excess of cold weather would adapt by increasing thecapacity of their snowmaking systems (i.e., making moresnow in a shorter period of time). Costs to skiers could riseto cover the increased costs. In areas where winter temper-atures are already marginal (the mid-Atlantic region andsouthern Appalachians), some ski areas would probably beforced to close.

On the one hand, warmer temperatures and more rainevents would most l ikely increase water availabi l i ty. Althoughmore water would be needed, greater availabili ty could meanno net impact.& ad++, people tend to stay home duringperiods of extreme cold;+egardless of how good the ski ing is .If the ngrnp:r..of extremely cold days were..reduced, skiervisitation would probably.increase. Therefore, the impacts of

Articles

increased winter temperatures on the US ski industry re-main speculative at best . For some areas, the impact could bedisastrous. For others , i t could resul t in no net impact . Andfor st i l l others, warmer winter daytime temperatures or lowerfrequencies of extreme cold conditions could be beneficial . Onthe other hand, increased frequency of prolonged “thaws”would be damaging. Changes in winter precipitation haveequally ambiguous impacts. If increased precipitation takesthe form of snow, an area will need less machine-made snow.If i t takes the form of rain, snowmaking needs will increase.

In summary, potential impacts of cl imate change on the skiindustry remain uncertain (Table S), because i ts l inks to theclimate regime are complex. Although it seems likely thatski areas operating in marginal cl imates could be seriously af-fected, the effect on ski areas in colder regions is less clear.Snowmaking is a key adaptive mechanism. Actual impacts willbe determined by the extent of climate-regime changes in spe-cific regions and the detai ls of how those changes manifestthemselves. Averages may mean little. Lengthened summer sea-sons wil l not offset loss of Ski ing vis i ts for marginal resor ts .Resul ts of aggregated s tat is t ical analyses suggest ing dramaticlosses to ski visitation need further validation by regional- andindustry-level analysis. Key climate factors, adaptation options,and socioeconomic impacts would of course be different forother forms of forest recreation.

Areas for future researchOur review suggests many ferti le fields for further socioeco-nomic research on the impacts of and adaptat ion to cl imatechange:

l Incorporate predicted investment and forest-management adaptations into new generations ofvegetat ion models, in&ding the resul ts of copingpractices, and richer scenarios for predicting theeffects of insects, diseases, and invasive plants.

l Conduct a detailed analysis of the cost and effective-ness of suggested strategies for deal ing with cl imatechange effects on forests.

. Evaluate how forest benefits other than t imber andrecreation (Swanson and Loomis 1996) are affected.

Table 5. potential impact of global climate changes on the ski industry.

I

l Evaluate distributional outcomes (how regions andpopulation‘subgroups are affected) of projectedresource changes, price changes, and market adjust-ments .

l Evaluate recreation effects in greater detail , especiallyto understand market adaptations for regions andindividual ac t iv i t ies .

l Validate and update behavioral relations (such assupply and demand equations) depicting marketadaptation in wood-product markets, outdoor recre-ation, and land-use change.

l Evaluate how global climate change will influence USforest-product trade.

l Evaluate the relative role of population and demanduncertainties compared with projected clirnate-change effects.

l Evaluate how quickly capital investments in timbergrowing and manufacturing may adapt to futureregional changes in forest resources.

Climate parameterof change Physical impact of change

Relative impact onthe ski industry

Higher winter temperature

Greater winter precipltatimL e s s s n o w , m o r e r a i n

M o r e s n o w , l e s s r a i n

G r e a t e r n e e d f o r s n o w , e i t h e r n a t u r a l o rm a c h i n e - m a d e , d u e t o i n c r e a s e d m e l t i n g

R e d u c e d s n o w m a k i n g o p p o r t u n i t yM o r e w a t e r a v a i l a b l e t o s n o w m a k i n g d u e t o

h i g h e r s t r e a m f l o wLess need for and reliance on snowmakingS t o r a g e p o n d s d u e t o h i g h e r s t r e a m f l o wI n c r e a s e i n s k i e r v i s i t a t i o n a t r e s o r t sC h e a p a r e l e c t r i c i t y

G r e a t e r n e e d f o r s n o w m a k i n gM o r e w a t e r a v a i l a b l e f o r s n o w m a k i n g d u e t o

h i g h e r s t r e a m f l o wR e d u c t i o n i n s k i e r v i s i t a t i o n a t r e s o r t sN e e d f o r a n d r e l i a n c e o n s n o w m a k i n g

s t o r a g e p o n d s - - c h a n g e u n d e f i n e dL e s s n e e d f o r s n o w m a k i n gL e s s w a t e r a v a i l a b l e f o r s n o w m a k i n g d u e t o

l o w e r s t r e a m flowP o t e n t i a l r e d u c t i o n i n s k i e r v i s i t a t i o n a t

r e s o r t s i f s n o w f a l l e v e n t s a r e m o r e f r e q u e n tN e e d f o r a n d r e l i a n c e o n s n o w m a k i n g

s t o r a g e p o n d s - - c h a n g e u n d e f i n e d

N e g a t i v eN e g a t i v e

P o s i t i v e

P o s i t i v eP o s i t i v eP o s i t i v e

N e g a t i v e

P o s i t i v eN e g a t i v e

?P o s i t i v e

N e g a t i v e

N e g a t i v e

?

20011 Vol. 51 No. 9 * BioScience 761

ConclusionAssessing socioeconomic implications of climate change in theforest sector is a daunting task Because t imber and recreationmarkets function on a regional basis, evaluating change re-quires est imates of change in regional cl imates, which are st i l lquite uncertain. Moreover, how vegetation and water re-sources will respond over time to a changing climate is un-certain. Commercial forests are modified at rates of 2% to 4%of area per year by t imber harvesting, and planting is locallyimportant. Also, considerable effort has been expended to un-derstand carbon storage in forests and in wood products andoptions for using woody biomass for energy. Incorporatingsuch human influences in models is critical. Over century-longtime spans, nat ional and regional populat ions, incomes, anddemand for wood products will change, with a wide range ofuncertainty. Climate-change effects seem likely to be small bycomparison. Finally, international trade is important formany forest products and for recreation, and could well be af-fected by climate changes.

For outdoor recreation, which is a major forest use, formalmodeling of climate-change effects has barely begun. Nonethe-less, exist ing information suggests many possible effects . Theexample of ski areas illustrates the complexity of climate-regime effects and illustrates the key adaptation of snow-making as a coping strategy.

Current socioeconomic modeling capabil i t ies can be viewedas first-generation tools useful for understanding problemstructure and for analyzing improved vegetation forecasts asthey are developed. Economic models generally predict that ,under climate change, total US forest inventories wiIl in-crease, t imber harvests will increase, and product prices willdecrease relative to an assumed stable climate. Although over-all market welfare tends to increase, some models predictthat consumers gain from climate change while landownersin some regions lose. Such distr ibutional impacts can be an-alyzed further with these tools. Changes in prices can mitigatemany of the most dramatic consequences of climate changein product markets by signaling producers and consumers tochange behavior. Market adaptation involves a wide range ofactivities, including replanting forests that have died back, shift-ing harvests from one region or species to another, changingland uses, and developing new technologies. This emphasison the many pathways for potent ial adaptat ions is a more im-portant result than the part icular numerical est imates, whichwill be revised with improved information.

Research to date has shown the importance of adaptivemechanisms in markets responding to cl imate-change impacts .However, any temptation to rely on current numerical esti-

mates of socioeconomic impacts in making pol icy decisionsshould be resisted. In summarizing the current state ofsocioeconomic assessment for policymakers, overconfidenceand oversimplif icat ion must be avoided. As current modelsare improved, they will become increasingly powerful toolsfor policy simulations and for providing a deeper under-standing of the biological and social interactions shapingforests. Furthermore, the role to be played by economic in-

BioScience l September 2001 / Vol. 51 No. 9

formation in making policies aboutiong-term environmen-tal change remains much in debate (Portney 1999).

Economics invariably moves from analyzing economic

processes and measuring price and income changes to sug-gesting which outcome or policy is most desirable. Somepeople might not consider the complete loss of alpine ecosysterns in the United States a positive development. Learning that“the aggregate of consumer and producer surplus of woodproducts will be higher” may not change their view. I t may bepossible to derive an “existence value” for the alpine ecosys-tem using economic methods (Swanson and Loomis 1996).Finding a common metric for effects on lumber markets andeffects on alpine meadows, however, will remain elusive.

AcknowledgmentsIrland assembled this article from coauthor contributions:Adams, Alig, Chen, and McCarl developed the FASOM modeland conducted new runs for this assessment; Betz reviewedliterature on forest recreation; Hutchins prepared the case onthe ski industry; Skog worked on carbon sequestrat ion andassisted in drafting this summary; and Sohngen reviewedliterature for this paper. The authors would l ike to acknowl-edge helpful aid from Virginia Dale, John Aber, Linda Joyce,and anonymous referees.

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