Trees are not created equal with regard to their ability to produce non-timber benefits such as mast for wildlife and aesthetic beauty. Details on these topics are beyond the scope of this article, but it is important to be aware that non-financial considerations may help make the option of individual crop tree management a more attractive choice than area-wide, stand-level treatments.

Data for this financial analysis are from a study conducted by the Northeastern Forest Experiment Station at the West Virginia University Forest near Morgantown, WV. Individual tree 8-year growth measurements were made in area-wide thinning plots established in 1982. In 1990, after eight growing seasons, selected individual tree remeasurements were made. The plots were originally thinned to 45 percent, 60 percent, and 75 percent stocking levels with no particular attention given to selection and release of individual trees. However, after five years of release, some individual tree crowns were evaluated to determine the number of sides of the crown released and to assign free-to-grow ratings (0 to 4, with 0 being none of the sides of the crown released, and 4 being all four sides released). Documentation proved (on the average) a Tree's growth rate was positively related to its free-to-grow rating.

To have the most current information possible, selected red oak crop trees in two size classes were remeasured after the 1990 (eighth) growing season. Ten trees ranging from 11 to 14 inches dbh (small sawtimber) and 10 trees ranging from 15 to 17.8 inches dbh (medium sawtimber)in 1982 were chosen to provide an estimate of a realistic growth rate for these two size classes of potential red oak crop trees. This measured growth rate provides an estimate of what can be expected on medium (site index 70) red oak sites. The estimate is conservative because not all of the trees remeasured received a crown touching release on at least three sides. Also, after eight years of crown expansion, many of the originally released trees were no longer free-to-grow on at least three sides. Five years after release, the average free-to-grow rating was 2.9 for the small sawtimber Trees evaluated. For the medium sawtimber, the average free-to-grow rating was 2.0.

In 1982, the mean size of the small sawtimber trees was 12.9 inches. Their per decade growth (based on eight years of measured growth) was 3.5 inches. The mean size of the medium sawtimber in 1982 was 16.0 inches. Their average per decade growth was 3.3 inches. They had an assumed initial sawlog height of 1 log for the small sawtimber, ,1.5 logs for the medium sawtimber, and 2 logs for the large sawtimber.

Looking at Past Performance

What was the rate-of-return and income for these trees during the eight years after thinning? To answer that question, stumpage values from Ohio were converted from Doyle Rule to International 1,/4" rule to establish tree values in 1982 and 1990. The changes in tree value, subsequent rates-of-return, and annual crop tree incomes in Table 1 reflect inflation, real changes in red oak stumpage value, icreases in tree volume due to physical growth, and changes in value of the wood because of an increase in tree grade. Stumpage unit value thresholds were established that reflected the change in timber value as the size of the tree increased. The threshold from small to medium sawtimber was set at 15.5 inches dbh - the same size that trees are large enough to be considered for grade 1 sawtimber. Trees were considered to be medium sawtimber until reaching 18 inches dbh. The value of the average tree in 1982 and 1990 was determined by proportioning the unit value of the wood according to position in the tree. For example, for a 15.7-inch tree with 1.5 logs, the butt tog was assumed to be grade 1, and the upper half-log was assumed to be grade 3. Using these proportional values, small sawtimber trees were worth $50/MBF in 1982 and $132/MBF in 1990. Medium sawtimber trees were valued al $69/MBF in 1982 and $200/MBF in 1990.

For the small sawtimber, two management scenarios were assumed: one in which the crop trees were released via commercial harvest (no cost for release) and one in which the crop trees were released precommercially at a cost of $5/crop free or $25/acre. The cost of $5 per crop tree was compounded at 4 percent so that at the end of The decade the equivalent cost was $7.40. This cost was deducted from the tree's stumpage value before computing crop tree income .and rate-of-return for the decade. For the medium sawtimber tree, the only scenario considered was release via a commercial harvest at no cost. The cost of owning the land and annual administrative costs were not incIuded in the analysis.

Using 1991 estimated red oak stumpage values from the Upper Midwest, individual tree real rates-of-return and annual crop tree incomes were calculated for 10-year and 20-year periods. In other words, if you have 12.9 inches dbh small sawtimber trees or 16 inches dbh medium sawtimber trees, and current stumpage values remain constant, you could experience the following types of value increases. Using the previously mentioned per decade dbh growth rates, a 20-year period will provide sufficient time for released crop trees of this size to reach a realistic financial maturity.

These are favorable rares-of-return and annual crop tree incomes, but is it feasible to conduct subsequent harvest operations for as few as five trees/acre on 10 acres? Is that an operable volume? If the crop trees are grown to 20 inches dbh and have an average height of 1.5 logs, the volume is 1,200 BF/acre. On 10 acres, this would be 12,000 BF of high-value red oak, sawtimber, vvhich in areas that are reasonably well accessed, is an economically viable volume when red oak markets are strong. And. there is the added benefit of at least producing some income from the land during a period that would normally yield no return. If. the stand were completely clearcut, there would be no limber income available for the subsequent 20-year period. With the crop tree management option, there would be same income in 20 years.

The information in Table 2 represents a worst-case scenario from an operable volume perspective. When only five crop trees per acre are to be left standing, the amount of harvest volume available in future years is limited. A more common occurrence is when there are only five high-quality crop trees/acre worth releasing in an otherwise relatively Iow-quality stand. If the land manager decides to release the crop trees and retain the Iow-quality volume not competing with the crop trees, it may make operability of future harvest operations more economically viable because of the additional volume (Iow-quality) that can be removed. Whether leaving only the crop trees standing, or releasing the crop trees and leaving other noncompeting trees, the more high-value crop trees available to release per acre, the more financially attractive the investment opportunity.

Crop Tree Selection Criteria

The quality of crop trees varies from site to site, so it is difficult to draft standards that have universal application. A tree that would not qualify as a crop tree on a good site in an excellent stand, may be the best that is available on a poorer, mismanaged site. When selecting crop trees, it is often a matter of picking the best available. For each stand, crop tree selection criteria should be established to help judge which trees are the best and to verbalize minimum standards for crop trees in that stand. To increase financial benefits from managing timber crop trees, the selection criteria should focus on those characteristics that indicate the tree is likely to produce high-quality products and grow at a rapid rate. Some common timber crop tree selection criteria are as follows:

· Dominant/codominant trees - large, healthy crown relative to dbh

· High quality - potential butt log grade of 1 or 2, no epicormic branches or dormant buds on butt log

· Tree appears to hove good !ife expectancy

· No high-risk trees - leaners, splitting forks, etc.

· Eilher stump sprouts or seedling origin stems are acceptable

When selecting red oak crop trees, it is important to look for indicators of the tree's probability of degrading in quality because of the development or growth of epicormic branches. Select timber crop trees with a dominant/codominant crown classification, and few, if any, dead branches in the upper crown. Trees with healthy crowns that are large relative to their dbh are much less likely to develop epicormic branches than trees with small, skimpy crowns. Do not select trees with dormant buds or existing epicormic branches (alive or dead) on the butt log. They indicate further epicormic branching problems in the future.

If we do a good job selecting red oak timber crop trees and giving them a full crown-touching release, we can expect good growth results. However, we must remember that even on good sites, there is a critical growth factor we can't control - the weather. At the West Virginia University Forest, periodic red oak crop tree growth rates varied from 2.5 to 3.5 inches per decade. Correlating that growth with precipitation indicated that some of that variation was related to weather conditions.

Releasing vigorous red oak timber crop trees will condition them to take advantage of favorable weather conditions and produce good physical growth rates. However, in order to turn that growth into financial return, we must have good markets that will support favorable stumpage rates. We must also do a wise job of marketing the timber for the landowner to obtain that financial return.

Conclusions

1. In many market areas in the northeast, like Ohio, the financial rewards for releasing individual potentially high-value red oak crop trees during the past eight years have been attractive.

2. The prospects for receiving financial benefits From culturing red oak crop trees in the Upper Midwest appear attractive based on current estimates of stumpage values. Real rates-of-return of 5 percent to 16 percent on trees that earn an annual income of $1.50 to $3 is possible in stands where as few as five potentially high-value red oak crop trees are free-to-grow or at least three-sides.

3. Stands containing 11-inch to 16-inch red oak crop trees should not automatically receive area-wide final harvest treatments without due consideration being given to the potential financial benefits of managing individual crop trees. Immature 10-acre stands with as few as five potentially high-value red oak crop trees/acre should be considered for crop tree release.

4. Applying related assumptions to pole and sapling size crop trees reveals a good probability for long-term financial gains. Attractiveness of investments in these smaller trees is hampered by the increased time period of the investment. However, with stands in this size class, there is a greater probability of finding more potentially high-quality crop trees/acre, which improves the per acre return of the investment.