Seeing the Forest For the Trees

By: Meg Henderson

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Posted: 6/13/2023

Seeing the Forest For the Trees Photo By: David Ammon

MISSISSIPPI HAS 19.2 MILLION ACRES of forestland, which accounts for 62% of the state's total land area. Nonindustrial private forest landowners own nearly three-quarters of all the forestland in Mississippi, about 70%. Like government and industry owned land, private forestland provides fresh water, habitats for fish and wildlife, recreational opportunities, and wood products. However, frequent resale activity for immediate profit can potentially threaten the long-term stability of timberland management and ecosystems on these properties.

A team of Forest and Wildlife Research Center scientists, led by DR. EDWIN SUN, partnered with scientists from The Ohio State University and the University of Georgia to study the turnover of private forest land in Mississippi over 21 years, from 1999 to 2019. Their study, supported by a U.S. Department of Agriculture McIntire-Stennis capacity grant, was the first of its kind nationwide, and it produced empirical answers to the questions that people in the industry were asking about ownership fragmentation.

"Working forests require a long-time commitment and investment, which is typically around 30 years for pine plantations," Sun said. "While we know that increasing forest ownership fragmentation in physical size has been a national trend, we wanted to better understand just how often these lands were changing ownership."

The team studied 18,783 parcels of private forestland located in eight Mississippi counties with varying geographical locations, populations, socioeconomic conditions, and proximity to urban centers. They found that about 46% of these parcels were sold at least once over the 21 years, with the maximum being nine times. The properties that changed ownership during this time were sold an average 1.5 times, with an average ownership duration of about five years.

Sun explained that traditionally, an owner would hold a property for 30-50 years, and that long-term ownership allowed for a consistent management plan. In more recent years, however, land ownership is viewed less in terms of a lifetime asset to be passed to the next generation and more in terms of utility and maximizing profits. This perspective has resulted in selling properties when the market conditions ensure a profit. However, profits come at the expense of long-term land management practices. If a new owner comes in every 3-5 years with their own priorities and plans, they often lack the knowledge of past management priorities and activities.

"Forest management activities, such as prescribed fire, boundary surveys, and harvesting timber, are not very frequent. Most of these activities happen once every five or ten years," Sun said. "With properties changing hands frequently, these activities may not take place when they need to."

Some key factors influencing the frequency of land sales are the size of the parcel, proximity of the landowner to the property, and presence or absence of a formed business (e.g., partnership, limited liability company, or corporation). The team found that landowners held onto smaller properties a few years longer than larger ones. Landowners living close to their properties tended to keep it longer than out-of-state landowners. And properties managed under a formed business (e.g., LLC or partnership) were sold more frequently than those without one.

"Because the internet makes buying and selling land relatively quick and easy, I expect that ownership fragmentation will continue to increase in the long term," Sun said. "That's why it's important to analyze the economic patterns of ownership fragmentation and its impacts on ecosystem services."

While further studies are needed to understand the broader impacts of ownership fragmentation on forestland management, timber production, and ecosystems, Sun sees this knowledge having implications for policy improvements, such as tax or cost-share programs, that encourage and reward longer-term ownership.

"Forests play a critical role in maintaining stable ecosystems and mitigating climate change. We believe it is critical for both landowners and policy makers to understand the importance of stable ownership and management of these lands," he said.