Selection of a chipper technology for small-scale operations - a Finnish case

Juha Laitila, Robert Prinz and Lauri Sikanen
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Robert Prinz: Natural Resources Institute Finland (Luke), Production systems, Joensuu, Finland
Lauri Sikanen: Natural Resources Institute Finland (Luke), Production systems, Joensuu, Finland

Journal of Forest Science, 2019, vol. 65, issue 4, 121-133

Abstract: The objective of this study was to determine the economic performance of alternative chipper choices for small-scale chipping based on unit cost (€ per chip-m3) and net present value (NPV) calculations. For the chipping cost and investment profitability analyses four tractor-powered professional or semi-professional disc chippers and two professional drum chippers mounted on a truck or powered by tractor were selected. Initial investment, operating costs, and the cost of outsourced chipping were the key elements for comparing the profitability of investment alternatives. The average purchase prices, cost factors, and technical details of the chipper units were acquired from machine dealers, specification sheets, a literature review, and interviews with chipping entrepreneurs. The results of the three tractor-powered professional chippers involved in the comparison were very close to each other. The profitable running of a truck-mounted drum chipper calls for high annual chipping volumes: the chipper type is therefore a feasible choice for an entrepreneur in large-scale chipping. Semi-professional disc chippers offer lower investment costs, but their economic feasibility is relatively poor.

Keywords: Investment; decision making; unit cost; chipping; entrepreneurship; productivity (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:caa:jnljfs:v:65:y:2019:i:4:id:26-2019-jfs

DOI: 10.17221/26/2019-JFS

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