Investing in Timber

[a1derfullife]

MAI is different from board feet produced!

Abngrrvn and justcfrall;

It appears that both of you are making similar errors when you consider MAI to be equivalent to board feet of lumber produced per hectare per year. In reality, board feet produced per hectare per year is much lower than MAI. MAI (mean annual increment, usually measured in M3 per hectare) is the increase in total wood volume for a given area per year. This wood volume includes the volume in branches, the tops of the trees, sapwood, pith, and other non-saleable wood.

The amount of board feet produced per hectare per year is often less than 50% of the MAI. For example, note 7 from TATF's teak projections page reads, in part

"The amounts of marketable wood for the thinnings and final harvest are based upon the calculated volume per tree and then reduced by the estimated amount of processing waste, which is sawing losses and damage to the logs while being harvested, transported and processed. The inefficiency of smaller diameter logs results in greater sawing loss on younger, smaller trees. Accordingly, we have subtracted a processing waste of 55%, 45%, 40% and 30% respectively for the 6, 10, 14 and 20 year old Elite Teak Clones and 55%, 50%, 45%, 40%, 35% and 30% respectively for the 7, 10, 13, 17, 21 and 25 year old seed-grown teak trees. "
http://www.tatf.com/teak_projections.htm
To arrive at appropriate MAI numbers, you need to use the tree growth and harvest projections, not the projections of board feet of lumber produced.

A1