An economic analysis of black spruce breeding in New Brunswick

Abstract

A representative black spruce (Piceamariana (Mill.) B.S.P.) breeding program was formulated using information collected from New Brunswick Tree Improvement Council cooperators. This "base program" was subjected to program profitability and program efficiency analyses. Costs and revenues were computed for a range of real discount rates. The results showed that variation in discount rates did not greatly influence the break-even level of gross discounted revenue, which was fairly stable at around $100 000 for the base orchard of 5.2 ha. Projected gross discounted revenue ranged from about $100 000 at 4.5% discount rate to $36 at 16%. With the internal rate of return at 4.4%, it was concluded that black spruce breeding is probably an economic means of securing extra wood supplies. The program efficiency component concentrated on resource allocation between plus-tree and family selection. The results suggested that current strategies are close to optimum; for a wide range of numbers of familis selected within a constant budget, gross returns remained within about 10% of the maximum possible for each assumption set. It was concluded that current breeding programs should be continued, with present recommended strategies retained.