The Impact of the Biomass Crop Assistance Program on the Forest Product Market
Author: Wei Jiang
Publisher:
Published: 2012
Total Pages: 85
ISBN-13:
DOWNLOAD EBOOKWith the concerns over energy security and greenhouse gas emission, the United States is the leading country in producing bioenergy. Although the government has instituted various policies concentrating on bioenergy, the policies addressing the plantation of woody biomass are few. Considering this deficiency, the Biomass Crop Assistance Program (BCAP) emerged in 2008 with the purpose of planting energy crops. However, its effects on forest product market, environmental sustainability and welfare economics are suffering attacks from the congress. This study aims at quantifying its effects on these three aspects by applying Global Forest Product Model (GFPM). Three scenarios were designed to simulate payments in BCAP. In the first scenario, the matching payments were simulated by adjusting the manufacturing cost of fuel wood and particleboard. In the second scenario, the establishment payments were simulated by adjusting the supply rate of industrial round wood. The third scenario employed the annual payments by linking the supply change rate with soil rental rate. The increasing productions from the establishment payments and the annual payments for fuel wood and industrial round wood are the main findings. A decrease could be found in particleboard under the matching payments, while modest increases happen in wood pulp and paper under the establishment payments and annual payments. Few changes were found in forest area but a slight decrease happens in forest stock under the establishment payment. All of three payments will lead to decreases in domestic producer surplus and consumer surplus but the exporters of wood pulp and paper are the biggest winners in this program.
