Are There Economic Benefits from Forest Stewardship Council (FSC) Certification? An Analysis of Pennsylvania State Forest Timber Sales.

Submission date
Bensel, T.
Bahn, V.
Newsom, D.
Working Paper
Version number

Despite steady increases in both the supply and demand for Forest Stewardship Council (FSC)-certified products over the past decade, many observers assert that FSC-certified forestry operations should not expect to receive higher prices for their products. We analyzed six years of data from timber sales on Pennsylvania state forest land – certified by the FSC since 1998 – to determine whether FSC chain-of-custody certified buyers are paying more for timber from these sales than non-certified buyers.We found that:• Between 2001 and 2006 FSC-certified buyers of Pennsylvania state forest timber sales paid approximately $7.7 million more for this timber than what would have been earned had all buyers been non-certified. Higher bid prices offered by FSC-certified buyers translated into roughly a 10 percent increase in revenue for the Pennsylvania stat forest over what would have been earned in the absence of certification. • The proportion of timber sold to FSC-certified buyers and the dollar value of those sales has increased dramatically since the state forests were first certified in 1998. By 2006, FSC-certified buyers accounted for nearly two-thirds of the dollar value of all state forest timber sales, up from less than 15 percent in 1998. The percentage of timber volume going to FSC-certified buyers increased from less than 10 percent in 1998 to over 40 percent in 2006, while the total acreage producing wood sold to FSC-certified buyers increased from 7 percent to nearly 30 percent over that time period.• Most of the additional revenue earned by the Pennsylvania state forests through sales to FSC-certified buyers is driven by the sale of black cherry. On average, FSC-certified buyers paid $198 more per thousand board feet (mbf) for black cherry from state forest timber sales than did non-certified buyers. The price differential for sugar maple was $138 per mbf, $49 per mbf for red oak, $35 per mbf for red maple, and $17 per mbf for white ash. There was no price differential for white oak. These results indicate that, in addition to any environmental or social benefits that FSC certification has brought to the management of Pennsylvania's state forests, certification has led to economic benefits in the form of higher prices being paid for state forest timber sales. While our research does not reveal the motivations of the FSC-certified buyers, one can only presume that they are willing to pay more because they are receiving financial benefits from their sales of FSC-certified products further up the supply chain. In the future we would like to test this hypothesis through a more detailed examination of the motives driving FSC-certified companies to pay more for timber. Future research will also examine timber sales from other state and public forests to determine whether the pattern observed in Pennsylvania holds elsewhere.

Subject Keywords
Markets, Price premium, Demand, supply, Certified products, Stakeholder preferences
Forest Type
Natural Forest
Forest Zone
Effective date
Review year
Alternative Strategy
Alternative Type
Pest Type
Alternative Trial
Coverage Country
United States of America
Active Ingredient