Rainforest Uncut Can be Worth More

Slide 59 (lect 20) is a exert from a report on the net flux of carbon into the atmosphere from changes in land-use. The report states the majority of carbon released into the atmosphere comes from deforestation in tropical regions. It then seems reasonable to slow or even halt such land-use change, but how can it be done. A good way, it seems, is to find more profitable uses for the land. The following article in the New York Times references a study that does just that.

Rain Forest Worth More if Uncut, Study Says. New York Times. 7-14-1989

Tropical deforestation is usually for the sale of timber and/or cattle ranching. The study found that profits from harvesting fruit, rubber, cocoa and oils surpassed profits from timber and cattle on plots of rain forest equal in size.

The study found that 2.5 hectares is worth $6,330 harvesting mostly fruits and latex over 50 years while only $3,184 for timber over the same period and $2,960 if converted to ranching. The article does not mention the average size of a plot of land and does not mention if a farmer could both harvest timber and convert to ranching and make the total combined. If so, harvesting mostly fruits and latex would still be more profitable. It could be even more profitable with a global carbon market.

Critics of the study think that most of the profits are inflated due to the size of the exotic fruit market like the ones harvested in the study and predict profits will decrease significantly at scale.

Of course, environmentalists believe the market for exotic fruits, latex, oil and cocoa does not catch the value of the trees left standing or the ecosystem more or less intact. A deeper understanding of the complex ecological interactions may one day assign value to services no yet tapped by the market. In light of climate change, as mentioned earlier, carbon markets are a starting point.

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