Economic evaluation of Eucalyptus wood use for different purposes in the region of Alto Jequitinhonha, MG.

Abstract

The objective of this research was to evaluate the economic viability of Eucalyptus wood use for four different purposes: charcoal, energy/firewood, construction and sawmill. We performed economic analysis using the three methods of project evaluation most commonly employed in Brazil, since they consider the capital variation in time, known as: Net Present Value (NPV), Equivalent Periodic Value (EPV) and Internal Rate of Return (IRR). We also performed a sensitivity analysis, considering the three rates most used in economic evaluation of forest projects, 6%, 9% and 12% per year (p.y.), also considering variation in production and in 10% of wood prices (both for more and less). The wood use that provided the greatest financial return considering discount rate of 6%, was the production of wood for construction (NPV = R$ 16,965.38/ha; EPV = R$ 1,825.22/ha/year; IRR = 38.0 %). For such interest rate, the production of logs destined for energy/firewood generated lower profitability (NPV = R$ 402.66/ha; EPV= R$ 43.32/ha/year; IRR = 8.0%), use that is uneconomical for the discount rates of 9% and 12% (p.y.).