2. Forest Products

Forest products, benefits, goods and services are widely used terms. However, in everyday and professional language the terms differ and there may be slightly different interpretations between forestry sciences and economics.

Benefit is a general term which points to the positive results or utilities derived from goods and services. Product in economic terms means the result of production. Products are either tangible goods (easy to see, feel or touch) or intangible services. Goods are actual materials and generally are tangible and transportable products (i.e., wood and non-wood products). Services are "less" material, intangible and primarily non-transportable (by human means) functions, which often will be consumed on-site (i.e., recreation, landscape). Sometimes services spread, at least marginally, far away, resulting in cleaner air and impacting the hydrological cycles of forests .

Two other economic concepts are important with regards to forest benefits: private and public goods. (Here, perhaps for historical reasons, "goods" will also include services).

1. Private goods are any good or service that if used by one individual or firm is not available to others. Private goods are exclusive in the sense that ownership rights can be established  to prevent (exclude) others from using the good or benefit. These exclusive goods are normal market products, which have a market price. More importantly, in forests these are traditional "major" products - for example logs for different purposes, pulpwood and fuelwood.    

2. Public goods, on the contrary, are mostly services (although sometimes also called goods) with such characteristics that one person's use does not decrease the amount available for others. Clean air, an attractive landscape and biodiversity are examples of public goods.

The borderline between private and public goods is not always clear. A recreational forest may almost be a public good when there are few people using it but can become closer to the characteristics of private goods under heavy congestion. There are goods and services that can be called semi-private or semi-public.

The determinants of private and public goods are many and refer not only to an aspect of consumption but sometimes also to the degree of exclusion (i.e., access and property rights) in production (Randall 1987). For example, forest flowers are a public good for all wanderers but become private when picked and transported off-site.

The borderline between goods and services in real life is not always sharp as some economic goods such as dinner in a restaurant or a picnic in a forest since these are combinations of goods and services (cf. Black 1997).

Goods can be raw materials and intermediate goods (mostly non-durable and used as an input in production), consumer goods (durable or non-durable, used by final consumers) and capital goods (mostly durable and used for production). Tangible forest products can be either raw-materials (i.e., logs for sawmill, pulpwood) or intermediate goods (i.e., logs for log houses) or consumer goods (i.e., berries and mushrooms, or firewood sold in markets). Sometimes similar products may have different phases of production or have different uses within all of these roles.

The general term non-wood forest product (NWFP) excludes all woody raw materials. Consequently, timber, chips, charcoal, fuelwood, as well as small woods used for household tools, household equipment and carvings; should conceptually be excluded from NWFPs (as is done in Figure F8). In contrast a similar but broader term "Non-timber forest products" (NTFPs), generally includes fuelwood and small wood items.  However, it has been difficult to formulate both logical and practical definitions (i.e., "woody plant" is not a clear-cut concept (see FOR1).

Figure F8: Classification of forest and tree products (modification based on FAO NWFP Progamme and de Groot et al 2002)

In FRA (FAO 2006), non-wood forest products were categorized into two groups: (1) plants and (2) animals (see also Figure F7), and they included the following sub-classes.

1. Plant products (food, fodder, medicine/aromatics, colourants/dyes, utensils/crafts/construction, ornamental plants, exudates, other plant products);

2. Animal products (living animals, hides,skins and trophies, honey and beeswax, bushmeat, medicine, colourants, other edible and non-edible animal products).

One Response to “2. Forest Products”

  1. Mihir Ojha Says:
    I am grateful to this site.....

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