Inventories, Appraisals & Bank Statements
You have a
bank account for some of your savings. You probably also have some money in a mutual fund. If you're like most people, you know exactly how much money there is in these accounts and what the
interest rates are. If you don't know, you could easily find out by looking at your latest bank and mutual fund statements.
Your forest also represents a form of savings or investment. There is
timber value out there that you could realize at retirement, for children's educations, or in case of emergencies. Or perhaps you might just want to make a trip somewhere. In any case, do you
know what the value of your timber is and what the interest rate is on that investment? You probably don't unless you have a good forest inventory and a good computer simulation of future growth.
This is where the
services of a consulting forester can be of assistance. He/she can do an inventory of your forest by systematic point sampling. This method of inventory is inexpensive and statistically accurate
enough to get a very good picture of present values. An essential component of an accurate inventory is an accurate portrayal of tree grades. Since the difference in grade value
from one grade to the next can easily be 100% or more, each tree in the inventory must be assigned a grade. Tree grading is also essential for accurate simulations of tree and forest value growth.
A computer growth simulation program called INFORM
is capable of calculating rates of value growth, or interest on your investment. The information provided by this type of inventory and simulation is also useful for financial planning. Simulations can estimate the value of your timber in 5, 10 or 15 years. Of course the longer the simulation, the more uncertainty about its accuracy. But ranges of future value can also be calculated to give you reasonable ballpark figures.
Forest inventories are usually done as the first stage in forest management planning
. They are also useful for landowners who have no intention of doing forest management, but who want to know the value of their assets, and their rate
of growth. Think of your forest inventory as a bank passbook, or as an account statement. And once you have one, ask for periodic updates so that you can always know the value that's out there
growing in your forest.