This study estimates the optimal rotation period of various tree species in Kenya and applies it in the management of lumbering forests through optimal synchronization of forest plantations to achieve a steady supply to lumbering firms. The optimal rotation period of three tree species, pine, cypress, and eucalyptus, was estimated using data from Kenya Forest Service. A combined application of Chang simple production model and Faustmann model reveals the optimal biological harvest age is 25 years for pine, 25 years for cypress, and 14 years for eucalyptus. However, introducing the prices and using the Faustmann optimal rotation model at the current market interest rate of 10.5%, the Faustmann rotation age for pine stand will be maximized at 12.67 years, cypress at 23.5 years, and eucalyptus at 38.4 years. The research further indicates significant variability in land expectation value and soil rent of various species and proposes an inclusion of “species” as a variable in forest land valuation. In the conclusion, nonmarket factors affecting the optimal yield were further explained and recommendations on sustainable yield production were suggested.
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