The Effects of Natural and Economic Factors on the Financial Performance of Forest Management Units: The Example of Forest Districts of the State Forests National Forest Holding from Eastern Poland

Abstract

Given the changing market conditions and uncertainty arising from climate change, forest management tends to focus on the financial functioning of forest holdings. The objective of this work is to study the financial performance of forest districts using ratio analysis, synthetic financial indicators, as well as the relationship between synthetic indicators and forest district categories defined in terms of forest site type, site fertility, compatibility stand species composition, species composition, harvesting system, harvesting intensity, fragmentation of forest complexes and management difficulty level. The study material consists of financial documentation from 82 forest districts of the State Forests National Forest Holding (SFNFH) in eastern Poland from the years 2015–2019 and 2005–2009 (for comparison purposes). Synthetic indicators were calculated using two sets of financial ratios as well as two variants of accounting data. In the study period, forest districts were found to differ in terms of their financial performance, which was affected by the natural and economic factors. The synthetic indicators were significantly higher (p > 0.05) for forest districts operating on low-fertility lowland sites, those managing stands with dominant pine, and those implementing a clearcutting regeneration system. The findings concerning the effects of selected natural and economic factors on the financial condition of forest districts may be used for financial planning and management by SFNFH, in particular in decision-making processes to optimize forest management. The applied methods may stand as a basis for the construction of a sectoral evaluation tool.