Short- and long-run effects of sustainable forest management practices on West Malaysian log supply: an ARDL approach

Abdul Rahim A. S., . and Mohd Shahwahid H. O., . Short- and long-run effects of sustainable forest management practices on West Malaysian log supply: an ARDL approach. pp. 369-376. ISSN 0128-1283

The Malaysian log supply is facing deficit since 1995; thereafter major timber products have moved from resource surplus to one of deficit. It seems obvious that without planted forest in the future the timber industries have almost reached the limit for growth. The log supply model for West Malaysia is based on an equation of domestic log supply from natural and planted forests as a function of weighted price of log annual logging area and royalty of logs. The results showed that the bounds test of log supply model was cointegrated at 10 significance. The short-run analysis revealed that log supply would increase as the price of logs increased. However in the long run it would lead to substantial reduction in the log supply. This is because when the price of logs increases the log supply tends to decrease. It is believed that this is due to controlled production and the stringent harvesting regulation to achieve sustainable forest management. Furthermore an increase in domestic price of logs would help to compensate for the lost volumes in the long run.

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Abstract

The Malaysian log supply is facing deficit since 1995; thereafter major timber products have moved from resource surplus to one of deficit. It seems obvious that without planted forest in the future the timber industries have almost reached the limit for growth. The log supply model for West Malaysia is based on an equation of domestic log supply from natural and planted forests as a function of weighted price of log annual logging area and royalty of logs. The results showed that the bounds test of log supply model was cointegrated at 10 significance. The short-run analysis revealed that log supply would increase as the price of logs increased. However in the long run it would lead to substantial reduction in the log supply. This is because when the price of logs increases the log supply tends to decrease. It is believed that this is due to controlled production and the stringent harvesting regulation to achieve sustainable forest management. Furthermore an increase in domestic price of logs would help to compensate for the lost volumes in the long run.

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Item Type:	Article
AGROVOC Term:	Forest management
AGROVOC Term:	Logs
AGROVOC Term:	Timber
AGROVOC Term:	Planted forests
AGROVOC Term:	Harvesting
AGROVOC Term:	Forest products
AGROVOC Term:	Forest resources
AGROVOC Term:	Domestic markets
AGROVOC Term:	Forest plantations
Geographical Term:	Malaysia
Depositing User:	Ms. Suzila Mohamad Kasim
Last Modified:	26 Apr 2025 15:32
URI:	http://webagris.upm.edu.my/id/eprint/21697

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