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Publications > Cahiers (English)> N° 41, 4th term 1996

 

Questions d'économie forestière
[Topics of Forest Economics]

Les marchés dérivés de produits agricoles : présentation et perspectives de développement dans l'Union européenne
[Derivative Contracts for Agricultural Commodities : Presentation and Perspectives of Development within the European Union]

Jean CORDIER (ENSA-INSFA, Economie, gestion et sciences sociales, 65, rue de St Brieuc, 35042 Rennes)

In : Cahiers d'Economie et Sociologie Rurales, n° 41, 1996, pp 5-38

Summary : The 1992 reform of the Common Agricultural Policy, the GATT signature in 1994 and the inpending integration of the Eastern Countries bring decisive signals on public market regulations. The first consequence is a definite comeback of consumer's demand on the whole food chain. The second is the increasing price volatility on a short and long term basis. These volatilities bring financial risks to the chain members from the producers to the commodity users. As a consequence, risk management techniques are under the professional's scrutiny. Eventhough the basic techniques of risk pooling and risk spreading through diversification are well-known in theory, their application at market level raises quite a lot of questions. Furthermore, a considerable innovation in diversified and customerized contracts has brought attention to many professionals and academics for potential use and consequences.

The article analyses the potential development of private risk management tools as traded on OTC or centralized commodities markets in Europe. These tools are currently heading a new industry on financial markets. What are the perspectives for agricultural commodity markets ? The first part of the paper is a rapid description and essay on the classification for the derivatives which are expanding rapidly in terms of customerized contracts. Not only has the contracts been more finely designed, they are also expanding in volume. The second part develops the main theoretical problems : market efficiency with respect to information and subject to the micro-structure of the market place ; spot and forward price relationships for innovative contracts ; optimal hedging using a dynamic approach or asymetric price risk management. The potential of development of derivatives contracts used as risk management techniques is presented in part three. For practical reasons, this potential is studied through three basic questions. Question one : is coexistence of derivative products and current agricultural policy instruments possible ? Question two : is it possible to use simultaneously co-operative (or pooled) risk management techniques and individual risk diversification using derivatives ? These two initial questions are related to the development of derivatives for traditional commodities. The third and last question is related to innovative products such as contracts on rights or yield insurance contracts. What is the potential of derivatives on rights to produce or to pollute for instance ?

As a conclusion, the paper indicates that the partial deregulation of European commodity markets brings a real incentive for risk management at each level of the marketing chain, from the producers to the food industry which transform volatile commodity prices into a fixed price for food products as described in a price range. The total amount of risk management demand will divide itself into mutualized techniques and individual portfolio techniques. Therefore, the absolute value of derivative contracts will increase in the coming years a well as its relative market share. The limit of this analysis is the quantitative evaluation of innovative products which depends on their diffusion rate within the industry.This is a long process where the future equilibrium of techniques is difficult to forecast.

Key-words : risk management, derivative products, OTC, European futures.

La valeur d'usage à des fins de loisir des espaces protégées en Espagne. Comparaison entre méthode des coûts de déplacement et méthode d'évaluation contingente
[Recreational use value of protected areas in Spain. A comparaison of the travel cost and contingent valuation method]

Luis PEREZ y PEREZ, Jesus BARREIRO (Servicio de Investigación Agroalimentaria, Gobierno de Aragón. Apdo, 727, 50080 Zaragoza), Mercedes SANCHEZ, Miren AZPILICUETA (Departamento de Gestión de Empresas, Universidad Pública de Navarra, Campus de Arrosadía s/n. 31006 Pamplona)

In : Cahiers d'Economie et Sociologie Rurales, n° 41, 1996, pp 39-56

Summary : Valuation of environmental goods, such as protected natural areas,allows us to obtain information that could be included in cost-benefit analysis as an aid for public sector decision-taking processes. This article presents an application of the contingent valuation method and of the travel cost method in order to obtain an estimate of the recreational use value of the Parque Natural del Señorío de Bértiz in Navarra (Spain). The empirical analysis is based on a survey delivered to 402 visitors during spring 1995. The individual travel cost methods is based on the estimation of a demand function for the number of trips to the place subject to valuation from which we derive an estimate of consumer's surplus.

How do we estimate this cost ? It would seem straight-forward that these costs should be the distance travelled to the park and the time invested in this trip and/or the time spent at the recreational area. If most visitors use private means of transport to get to the recreational area we could calculate the travel cost as: the real variable cost (petrol costs) or the total real costs (variable cost + depreciation).

The contingent valuation method is based on the construction of an hypothetical market where we ask visitors directly for their willingness to pay for a visit to the park. In order to obtain the recreational use value of the park we use a dichotomous choice question followed by an open-ended one.

After the application of both methods, we remark that the results are close to those obtained in other applications found in environmental goods valuation literature and detect certain sensibility of the results we obtain depending on the hypothesis considered.

Key-words : Contingent valuation method, travel cost method, protected areas, Spain.

Questions d'économie forestière
[Topics of Forest Economics]

Les services d'environnement fournis par la forêt : évaluation et régulation
[Environmental amenities provided by forests : evaluation and regulation]

Alain DESPRES and Dominique NORMANDIN (INRA ESR Nancy, Unité économie et politique agricole et forestière, 14, rue Girardet, 54042 Nancy cedex)

In : Cahiers d'Economie et Sociologie Rurales, n° 41, 1996, pp 61-91

Summary : Considering the growing demand for environmental quality, forest management practices are now discussed at various institutional levels (regional, national and international). The dramatic situation of tropical countries involves to protect forested areas. Nevertheless, in Europe and especially in France, the problem emerges in a different context. The main questions concern the choice between an efficient timber production and non-market benefits. As the importance of timber as raw material is recognised, society seems to be more and more involved in protecting ecological and landscape quality of forests. This paper examines the various problems induced by this new demand.

The first section gives indications on the definition of non-market benefits of forest and precises some useful concepts for forest management. The role of timber industry is mentioned because environmental quality in forest should not be studied without considering the economic importance of timber.

The second section examines and discusses the traditional microeconomics analysis of forest harvesting facing constraints of environmental protection. The basis of the analysis is the so-called Faustman model able to calculate the optimal forest rotation when only concerning timber value. The hypothesis are discussed : objectives of the forest owners refer to a world without uncertainty, but the very long term of timber returns restricts the relevance of such a viewpoint.

Finally, the third section gives some examples of regulation as applied in France. For a long time, French government has been intervening to protect forests, by imposing legal restrictions to limit harvesting and to control forest management. Nevertheless, this intervention does not proceed by a regulation of non-market benefits, but only consists in protecting a traditional use of rural territory. Along the time, other restrictions have appeared to protect directly specific natural areas in the form of legal statement. But such a practice does not reveal a real change in the general forest management but only a protection on specific areas. Some examples of practices which are applied in Germany are presented.

Key-words : forest, environment, non-wood benefits, multiple uses.

Modélisation économique de la dynamique des forêts tropicales : une revue de la littérature
[Economic modelling of tropical forests dynamics : a survey of the litterature]

Isabelle CLEROUX (ENSET, Université Montpellier 1, Espace Richer, avenue de la Mer, BP 9606, 34054 Montpellier cedex 1), Jean-Michel SALLES (CNRS, Université Montpellier 1, Espace Richer, avenue de la Mer, BP 9606, 34054 Montpellier cedex 1)

In : Cahiers d'Economie et Sociologie Rurales, n° 41, 1996, pp 93-131

Summary : Numerous econometric analysis have tried to precise the dependency of forests dynamics on variables like demography, income, agricultural productivity or tropical timber production and trade. Making these analysis significant, despite the historical and geographic specificity of each situation, can be improved through the choice of the dependant variable (preferably the absolute level of deforestation).

It is delicate to compare the weight of an explaining variable in distinct models, but some significant ideas of general validity can nevertheless be drawn from this exercise. (i) Numerous analysis show a strong relation between population and forest area dynamics. It is nevertheless difficult to anticipate the impact of the growth of demographic pressure without referring to the technical and institutional environment. ii) There is no clear-cut relation between deforestation and the various income indicators, namely the growth of the income per capita has multiple and contradictory effects on the demand for timber and agricultural land. (iii) The increase in agricultural productivity has two opposite effects : on the one side, it diminishes the need of land to reach a given level of production ; on the other side, it makes the local agriculture more competitive and may lead to the development of the production in the area. (iv) Tropical timber international trade does not appear as a significant factor of deforestation (6 % of the total timber volume). But the opening of new roads for the cutting pave the way for the settlement of landless farmers.

Defining conservation policy imply a better understanding of the behaviours of the main deforestation agents. The farmers behaviours are influenced both by general variables like the level of wages, interest rates, agricultural and timber prices, and others factors more specifically related to the expanding agricultural frontier like the existence of roads or the promotion of anti-erosion techniques. The foresters' strategies appear to be strongly dependant upon the security of the rights they may get on the land, and the existence of rent seeking opportunities.

The analysis of the impact of national and international conservation policies has been noticeably improved by the use of computable general equilibrium models that allow to take more precisely into account the behaviours of the main agents of the process, and to simulate more comprehensively the simultaneous impact of policy tools. The main results of several models are presented. It must be emphasised that their scope is more heuristic than practical.

Key-words : tropical deforestation, public policies, econometrics, general equilibrium modelling.

Gestion des forêts : rentabilité et durabilité sont-elles opposables ?
[Forest management and the opposition between sustainability and rentability]

Jean-Philippe TERREAUX (IGREF, INRA, Unité d'Economie et sociologie rurales de Toulouse, BP 27, 31326 Castanet-Tolosan cedex)

In : Cahiers d'Economie et Sociologie Rurales, n° 41, 1996, pp 133-147

Summary : The sustainable forestry management, which has been for a long time a reality in most French forests, has some direct impacts on the parameters of sylviculture, and therefore on the results of the management. But instead of calculating, as a consequence, the cost of sustainability, and of using this cost to criticize this concept, or in the contrary, instead of using the arguments used to define sustainability in order to criticize the economic profitability, we show that both objectives originated in thoroughly logical deductions are built on different economic hypothesis.

For this purpose, we use a so-called "paradox" as an illustration, which consists to compare the management rules followed by two forest owners, intending to draw regular incomes, and yet proceeding in two different ways.

Key-words : economics, forest, management, sustainability, forest planning, assessment.

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