The Global Forest Trade Model GFTM

A meaningful assessment of policy options within the forest-based bioeconomy presupposes the capability to model market implications. To this end, an economic forest-based sector model, the Global Forest Trade Model (GFTM), is being developed at the Forest Resources and Climate unit of the Institute for Environment and Sustainability (IES). The GFTM is an equilibrium trade-based model for the forest sector with the aim of providing projections of production and trade of wood-based products and pellets for 48 countries/sub-regions of the world, with a focus on EU. This technical report describes the set-up of the model.The study outlines the theoretical framework, the programming of the model in MatLab, data collection, parameters used, and the calibration of the model. Presented test runs with GFTM indicates that the model behaves in a logically consistent way, all in all well in line what can be expected from economic theory. The next steps in the development process entail trying out linkages with a forest resource model and a dedicated energy model.