The economic viability of farming in Saskatchewan is eroding and the future of the industry is becoming uncertain given the current economic state. The combination of low commodity prices, increasing input and transportation costs, ongoing drought conditions, inadequate safety net programs, and environmental concerns resulting from agricultural greenhouse gas emissions has led to this uncertainty.
One possible solution for producers to help overcome or at least minimize the negative trends occurring in agriculture, which is proposed, is afforestation of agricultural land. Afforestation not only provides net private benefits of timber income but external benefits, including carbon sequestration, and preservation of native forests, which provides areas for hunting, wildlife viewing, and conservation of land.
The economic efficiency of afforestation was examined using a transitional benefit cost framework for both crop and pasture systems. This allowed for both private and social perspectives, along with the opportunity costs, to be included and the economic efficiency of afforestation from each perspective was determined. The potential conversion of agricultural land to afforestation was based solely on economic efficiency and assumed producers demonstrated an economically rational decision making process.
The results from the benefit cost analysis indicated that the net private benefits from afforestation were never significant enough to warrant the conversion of either crop or pasture systems to afforestation. The results did however show that the net social benefits from afforestation would warrant the conversion of crop systems to afforestation for a limited number of situations. Crop systems on physically marginal land with a carbon payment of either $22.58 or $33.55 tonne of C would warrant conversion to afforestation, using either a single or infinite rotation. The infinite rotation resulted in a larger allocation of land to afforestation.
The role afforestation can play in helping producers diversify and increase income levels is limited. The low price paid for timber and the high costs of establishment for afforestation are the main constraints. In order for afforestation to become economically efficient on a large scale the constraints facing producers needs to be addressed.
| Identifer | oai:union.ndltd.org:LACETR/oai:collectionscanada.gc.ca:SSU.etd-09202004-115711 |
| Date | 29 September 2004 |
| Creators | Sobool, Desmond Jay |
| Contributors | Belcher, Kenneth W. |
| Publisher | University of Saskatchewan |
| Source Sets | Library and Archives Canada ETDs Repository / Centre d'archives des thèses électroniques de Bibliothèque et Archives Canada |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://library.usask.ca/theses/available/etd-09202004-115711/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to University of Saskatchewan or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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