A Dissertation Submitted in Partial/Fulfillment of the Requirements for Award
of the Degree of Master of Business Administration (MBA) of Mzumbe
University
2013
ABSTRACT
This dissertation was to provide in depth comparative analysis of profitability of
thinned and unthinned commercial forest plantation with and without carbon
revenue. The study was conducted for Plantations under Green Resources Ltd and
Sao Hill Forest Plantations in Mufindi District. The main objective of this study was
to compare the profitability of thinned and unthinned commercial forest plantations
with and without carbon sequestration. The study was conducted in two phases; the
first phase was a time and work study on thinning operations. The second phase,
involved enumeration of thinned and unthinned compartments. Systematic random
sampling was used and the plots were distributed systematically throughout the
planted area in order to achieve representation of different species, age classes and
sites in the forest. The plots were geo referenced using a GPS. Plots were circular
with an area of 0.04ha and a radius of 11.28 m. Data were collected by using direct
observation, survey, enumeration methods and records of previous years. The study
revealed that, there is significant difference on average stem diameter on thinned and
unthinned forest plantation both for GRL and Sao hill forests. Furthermore the study
revealed that, it is more profitable to invest in thinned forest plantations when
combining sawn timber and carbon revenue. Moreover the study revealed that, the
trees with ages between 11 to 14 years for Green Resources and Sao hill forest
plantations attain high AEV with and without carbon revenue (CR). A plantation
with CR has high AEV compared to a plantation without CR. Also between the ages
of 11 - 14 years, the forest plantation attain the highest NPV/ha and AEV/ha before
and after the last thinning at age 13. Our study tested different thinning methods and
the results revealed that, thinning by using a chainsaw significantly reduced cost,
time and increased productivity when operating on a large scale and when manpower
is inadequate to cover all the operations in managing the forest. It is therefore
recommended that, forest plantations owners thin all their forest plantations and
forest plantations owners should ensure timely and proper silvicultural treatment in
order to ensure high performance of the plantations. Furthermore, it is recommended
that, for the sites like Idete that did not show a promising volume, thinning intensity
should change and extend the rotation age from 20 to 25 to ensure better gain in
volume and tree diameters. From supply chain matrix, it is recommended that,
plantations should be thinned by using chainsaw as it significantly reduces cost, time
and increases productivity when operating on a large scale and when manpower is
inadequate to cover all the operations in managing the forest.Lastly, I recommend
that, forest plantations should also engage in carbon business because it gives high
AEV, Net Revenue and NPV compared to the plantations which are not engaged in
carbon business.