Precision forestry: A revolution in the woods | McKinsey

McKinsey reports

Digital technology is revolutionizing industries around the globe, from manufacturing to healthcare. Even agriculture is undergoing enormous change due to technologies like variable-rate fertilization and automated harvesting. Forestry, on the other hand, has lagged behind most other industries in the adoption of digital technology. This, however, is finally starting to change. Studies are already showing productivity increases in general agriculture at rates of 5 to 25 percent annually, with returns on investment of one to two years for digital technology (depending of course on many factors, such as farm size, crop selection, and other conditions). Analogous gains are not merely on the horizon for forest products but are also being realized by some pioneers today. The size of these gains is comparable only to the shift from animal-powered to mechanized processes and, in food farming, the Green Revolution of the 1960s.

That said, in forestry-management science, digital solutions currently confront a system that still operates largely on the basis of fundamentals developed by Hans Carl von Carlowitz more than 300 years ago.Processes are highly manual and analog, with “broad-brush” management prescriptions. Introducing advanced technology in forest management faces several challenges:

• There is little corporate involvement in forestry; 76 percent of forests globally are publicly owned,and most of the remainder are held by small private owners (who typically hold, on average, less than one hectare, or roughly two-and-a-half acres).
• State and other public forest owners tend to be relatively conservative in their management style and, to a greater extent than private enterprise, need to balance diverse objectives for commercial performance with social and environmental goals.
• Many private forest owners have operations characterized by a lack of scale and expertise required to adopt the latest technologies.
• Large-scale commercial forests, from eucalyptus plantations in South America to managed natural forests in Europe and North America, are in remote and rugged terrain, presenting many challenges for adoption of new technologies.
• While a wide range of precision forestry technologies exists, relatively few practical examples are up and running, and few understand how the technologies translate into real use cases