The GFPM uses Microsoft Excel (MS Office 97 or better) for manipulating input and output data. All input data are in the five Excel files WORLD.XLS, AFRICA.XLS, AMERICA.XLS, ASIA.XLS, and EUROPE.XLS. The file names must not be changed.
Data relating to different parts of the model are on nine main worksheets within each workbook:
1. demand;
2. supply;
3. manufacture;
4. capacity 1;
5. capacity 2;
6. recycling supply;
7. transportation cost and tax;
8. exchange rate; and
9. exogenous change.
The first eight worksheets mostly contain the data required to calculate market equilibrium in the base year. The exogenous change worksheet contains all the exogenous trend data required to calculate market equilibria in subsequent years (i.e. in the dynamic phase of the model).
Other sheets (TechChange, GDP, RECYCLE) facilitate changes in the models. In each additional sheet, there is a corresponding macro to distribute the data between the main sheets. Each of the main worksheets is described below using the example of the ASIA model. The differences between a regional model such as the ASIA model and the WORLD model are noted as well.
It may be helpful to read through the following descriptions while examining a GFPM file on the computer.
The GFPM has a demand equation for each country, territory or region and for each consumed commodity (fuelwood, other industrial roundwood, sawnwood, veneer/plywood, particle board, fibreboard, newsprint, printing and writing paper, and other paper and paperboard). The Demand worksheet (see Table 2) contains the data that define each demand equation: the quantity consumed in the base year, the corresponding price, and elasticities with respect to price and GDP.
Table 2. Data for demand equations
Table 2 above presents some of the first and last lines of the GFPM demand sheet. Line 19, for example, indicates that in country 01 (Afghanistan), for commodity 80 (fuelwood), the base-year price is $US45.2 per m3 and the base-year quantity is 5,617,000 m32. The price elasticity is -0.10, which along with the price and quantity data fixes the position and slope of the demand curve for the base year. The elasticity with respect to GDP is 0.40, which represents the way in which the demand curve will shift from year to year in response to changes in GDP (defined in the "Exogenous Change" worksheet). Column N, consumption in the year before the base year, is needed to simulate recycling; for this purpose base year data are adequate. Other columns in the demand sheet are not used and should be filled with 0s.
Lines 23-25 appear at the bottom of the Demand sheet, but are shown here in order to show how they differ from the other lines of the sheet. Region 97, which represents world demand for Asian exports, demonstrates the trade link between the WORLD and the regional models. Here, it specifies that the countries of Asia should export at least 2,179,000 m3 of fuelwood to other countries in the region and the rest of the world. This export demand constraint is updated from year to year according to the solution of the WORLD model (see Exogenous Change, below).
Note that entries in the Demand sheet must be arranged in ascending order by country or region and then by commodity. Country and commodity codes must also have two digits, even though the first one may be zero. Price and income elasticities of demand are sometimes both set to zero. If the quantity in column D is 0, the price elasticity in column E must also be 0, otherwise a runtime error will occur.
The GFPM does not use all of the capabilities of the PELPS system. In some cases the omission of these elements requires that a 0 or other placeholder (as designated on the appropriate worksheet) is included I the worksheet. When entering new data, the best way to be sure of using the correct format is to type new data into an existing GFPM spreadsheet without altering the format. This will ensure that the input file's contents are properly read by the program. Deleting blank columns, for example, will cause errors.
The GFPM has a supply equation for each country or territory and raw material (fuelwood, industrial roundwood, other industrial roundwood, other fibre pulp, and waste paper). The Supply worksheet (Table 3) contains the data that define the supply equations: the quantity supplied in the base year and the corresponding price, plus elasticities with respect to price and an upper bound on supply (where necessary). The supply curves and upper bounds shift over time at a rate specified in the Exogenous Change sheet.
For each raw material in each country, the GFPM represents the supply of industrial roundwood with a price-responsive supply curve, defined by price, quantity, and elasticity of supply with respect to price. Supplies of fuelwood, waste paper, other industrial roundwood, and other fibre pulp are perfectly elastic up to an upper bound. For waste paper the upper bound is endogenous and is a function of the previous year's paper consumption.
Table 3. Data for supply equations
The example in Table 3 indicates that the price of industrial roundwood (commodity 81) in Afghanistan (country 01) in the base-year is $US97.8 per m3, while the corresponding quantity supplied is 856,000 m3. The elasticity of supply with respect to price is 0.4. The number 1 in column F causes the supply curve to shift at a rate specified in the exogenous change sheet. The upper bound on supply in the base year is 941,600 m3. In PELPS, a value of zero for the elasticity of supply and for the upper bound of supply is used as a proxy for infinity, so in Afghanistan, for example, the supply curve for other fibre pulp (commodity 89) is horizontal and has no upper bound.
Line 23 in Table 3 is the import link between the ASIA and WORLD models. It specifies that the countries of Asia must import at least 1,419,000 m3 of fuelwood from other countries in the region and the world. This import supply constraint is updated from year to year according to the solution of the WORLD model (see Exogenous Change, below).
In the GFPM, fuelwood and other industrial roundwood are the only commodities to appear on both Demand and Supply sheets. Demand for industrial roundwood and other fibre pulp, the two other commodities that have explicitly defined supply curves, is determined via input-output coefficients (i.e. the amount of industrial roundwood which is required to produce one unit of a downstream product such as sawnwood; panels; and pulps) which are specified in the Manufacture sheet (see below).
In contrast, final products have explicitly defined demand curves, but their supply is defined using input-output data specified in the Manufacture sheet (except for fuelwood and other industrial roundwood, which are both raw materials and final products).
As with the Demand sheet, entries in the Supply sheet must be put in ascending order by country or territory and then by commodity.
The Manufacture worksheet contains data that define the manufacturing costs (in $US) and manufacturing coefficients (input required per unit of output) in the base year.
Manufacturing costs are called M records and manufacturing coefficients are called P records. M records must be entered first, followed by P records. The current version of the GFPM does not use the by-products option (record type B).
Each type M record must be ordered so that the data is in ascending order by country and then by commodity within the same country. Records for a given country and commodity must also be placed in ascending order by manufacturing process and then by product mix for a given process. the current version of the GFPM uses only one process and product mix for each country and commodity, but product mixes and manufacturing costs vary by country.
Each type P record, must also be ordered so that the data is in ascending order, firstly by country, then by input commodity and then by output commodity. Multiple records for any given output commodity must also be ordered by process then by product mix.
For example, line 29 in Table 4 indicates that in Afghanistan (country 01), the manufacture of 1 m3 of sawnwood (commodity 83) by process 31 and input mix 1 costs $27 per m3 in the base year. This is the cost of manufacturing excluding the cost of raw material inputs (i.e. industrial roundwood). In the current version of the GFPM, the manufacturing cost in the base year is computed as the world price of the output minus the cost of the inputs. The cost of inputs are, in turn, calculated as world price of each multiplied by each input's input-output coefficient and summed over all input commodities (see Appendix C).
Line 33 indicates that, in Afghanistan (country 01), the production of 1 m3 of sawnwood (commodity 83) using process 31 and input mix 1 requires 2.13 m3 of industrial roundwood (commodity 81)3.
Table 4. Data for manufacturing costs and input-output coefficients
The Capacity-1 sheet contains the data required to predict the net change in total manufacturing capacity (i.e. the total net change in all countries of the world, or of the specific region considered), from one year to the next, for each manufactured commodity. It is needed to generate multi-period when with the accelerator model of capacity expansion is used in the model (option 4 of the PELPS main menu). This model, which is used in the
current version of the GFPM, estimates the total net change in capacity as a linear function of the three previous changes in total production, i.e. as:
Net Capacity Change from t to t+1 = b1(production change from t-1 to t)
+ b2(production change from t-2 to t-1)
+ b3(production change from t-3 to t-2)
where b1, b2, b3 are expansion parameters, which are put into columns E through G of the worksheet. Columns B to D in the worksheet contain the production level for each commodity in the three years preceding the base year of the model.
For example, line 11 in Table 5 indicates that total production of commodity 83 (sawnwood) in all countries in the ASIA model was 107,726,000 m3 in 1993; 103,010,000 m3 in 1992; and 105,379,000 m3 in 1991. The base year (1994) production is computed endogenously by the model. The corresponding expansion parameters of the capacity function are 0.40 for 1993-94 production change, 0.33 for 1992-93 production change, and 0.37 for 1991-92 production change.
Table 5. Data on past production and expansion parameters for capacity
The Capacity-2 sheet contains data on the level of manufacturing capacity by country and commodity. The data must be listed in ascending order, country and territory, then by commodity and then by manufacturing process (where applicable). The current version of the GFPM does not use the other parameters, which are set to 0, 1 or -1. Capacity growth for each country and territory and commodity depends, on the current level of production and the shadow price of capacity, both of which are computed endogenously (see Appendix B).
For example, line 18 in Table 6 indicates that in Afghanistan (country 01), the capacity to produce sawnwood (commodity 83) by process 31 (defined on the Manufacture sheet) is 460,000 m3. The cost of capacity and expansion parameters are not used in the model, and must be set to 0 or 1 as shown in Table 6. The 999,999 in column F is a proxy for infinity, reflecting the assumption that manufacturing capacity for this commodity in this country is effectively unconstrained. In the current version of the GFPM, this is done only for pulp, because the pulp statistics contained within the model are inconsistent with the paper statistics. In this case, capacity constraints are applied to paper and paperboard production and pulp consumption is derived in the model using the input-output coefficients. Base-year capacities are assumed to be 115% of base-year production for sawnwood and panels, while for paper they are assumed to be 110%.
Table 6. Data on base-period capacity and country-specific capacity change
The Recycling (supply) sheet contains the data that define the potential recovery of waste paper from consumed paper and paperboard. For each paper type, this sheet specifies the potential recovery rate of waste paper in the base year. The consumption of waste paper in a particular year is a function (expressed by input-output coefficients) of the production of paper in that year, while the supply of waste paper is horizontal and bounded by the coefficients in the Recycling (supply) sheet, giving the minimum and maximum percentages of the previous year's paper consumption that can be recovered as waste paper.
The user must provide upper bounds on the supply of the recovered waste for the base year (column H in Table 7) and then the data must appear in ascending order by region, then by recycled commodity and then by consumed commodity.
For example, line 10 in Table 7 indicates that in country 01 (Afghanistan), the maximum proportion of commodity 91 (newsprint) recoverable as waste paper (commodity 90) is 34%. The minimum recovery rate is 0% in all countries. The 1 in column F simply indicates that the demand and supply regions are identical (i.e. no demand region contains two supply regions or vice versa), as is the case of all regions in the GFPM.
Table 7. Data on waste fibre recovery
The Transportation Cost and Tax worksheet contains information on the direction and quantity of international trade. Data must appear in ascending order by origin region, then by destination region and then by commodity. In the current version of the GFPM, all countries export to and import from a single region, (the World). Because prices are set equal to world prices in all regions, the transportation cost is set to zero for all countries and commodities, as are import and export taxes. Transportation costs are instead reflected in manufacturing costs, which are derived from world prices (Appendix C) and in the demand and supply curves, which are also positioned by world prices inclusive of transport cost. The trade inertia constraints in column J are set to 0, indicating that trade is fixed at its observed value in the base year solution.
For example, line 12 in Table 8 indicates that Afghanistan (country 01) exported 2000 m3 of industrial roundwood (commodity 81) to the world (region 97) in the base year, 1994.
Table 8. Data on trade
All prices and costs in the GFPM are expressed in $US, so they do not require conversion into a common currency. The Exchange rate sheet therefore contains only a column of 1s for all countries (Table 9).
Table 9. Exchange rate data
The Exogenous Change sheet contains data that describe the evolution of production, consumption, trade, and prices as a function of the following exogenous factors:
1) shifts of the demand curves (record type D)
2) shifts of the supply curves (record type S)
3) changes in input-output coefficients, reflecting technological change (record type P)
4) changes in waste recovery coefficients (record type W)
5) changes in trade inertia constraints (record type T).
The data are organized by period (see Table 10), headed with the name PERIODt where t (between 1 and 16, the year 16 being the year 2010 in the current model) is the period when changes are to be made. There must be no blank line between periods. PERIOD1 must always be present for multi-period forecasts, whereas PERIODt is optional for t of 2 or more. If PERIODt is absent, the changes at time t are the same as those at time t-1. In particular, the GFPM assumes that the trade inertia constraints are the same (in percent terms) for every year through to the end of the forecast period. Thus, record type T entries appear only in period 1 in the current version of the GFPM, although this can be modified if changes in future trade inertia constraints are desired.
In the GFPM, demand curves shift with exogenous changes in real gross domestic product and supply curves shift with exogenous changes in timber supply. Rates of change of GDP are in record type D, while annual percentage shifts in supply curves are in record type S. Manufacturing coefficients for paper and waste recovery coefficients, in record types P and W, change throughout the projection period.
Table 10 is a greatly truncated example of the data in the Exogenous Change sheet. Line 47 in Table 10 indicates that the rate of change in GDP (the only shift variable for the demand curves of the GFPM) is .0840 in 1995 in Afghanistan. The model uses this information to shift the demand curve for fuelwood (commodity 80) from 1994 to 1995.
Line 49 links the regional model, here ASIA, to the solution of the WORLD model. Solutions from the WORLD model determine the total exports from and imports to all countries in ASIA model for each year of the projection. Line 49 reflects the fact that according to the WORLD model, total exports of fuelwood from the Asia region increased by 2% from 1994 to 1995. In the ASIA model, then, the world (region 97) minimum demand for fuelwood is increased by 2% from 1994 to 1995. The "LinkGfpm" macro (see Appendix G) enters these data automatically after running the WORLD model.
Line 51 indicates that the growth rate in the upper bound of supply (i.e. maximum supply potential) for fuelwood in Afghanistan is 2.01% from 1994 to 1995. The supply curve for fuelwood shifts outward at this rate between the base year and first period (since this entry appears in the "Period1" section of the sheet).
Line 53, is analogous to line 49 and shows that the WORLD model had predicted a decrease in Asian imports of fuelwood (commodity 80) from the world (region 98) of 4% between 1994 and 1995.
The manufacturing coefficient giving required mechanical pulp per ton of newsprint in period 1 (0.60), is given in line 55. Changes in these manufacturing coefficients over the projection period represent exogenous trends in technology.
Table 10. Data on exogenous changes
Line 57 gives the updated recovery rate of waste paper from newsprint consumption. Updating these coefficients simulates exogenous technological changes and different recycling policies.
Line 59 indicates that the maximum allowable rate of change in exports of industrial roundwood from Afghanistan between 1994 and 1995 is 25%. These trade inertia parameters, based on historical changes in year-to-year trade levels, are meant to reflect the fact that imports and exports adjust gradually to changes in economic conditions. They define the largest relative change that could occur during one year.
If you change the input data files, you must save the changes in Excel in the usual way (i.e. by choosing Save under File).
2 The figure in the demand worksheet is 5617.0, because all the quantities in the model are in thousands (the convention used in the Forest Products Yearbook) but this doesn't have to be the case as long as the same units are used throughout the model.
3 Note that in type M records, output commodity records are placed in column D, while in type P records, they are in column E.
