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Abstract
Pine wood nematode, B. xylophilus poses a serious threat for the European forest
industry. This study applies a quantitative risk assessment to analyze the risk of pine
wood nematode in the EU, by estimating the reduction expected within forestry stock
available for wood supply and its downstream roundwood market. Spatial analysis is
used to join information on climate suitability, host distribution, pest spread and value
of assets. Economic impacts are presented spatially on a NUTS-2 scale based on
partial budgeting technique and for the EU as a whole based on partial equilibrium
modeling. Results highlight the Southern regions of Europe as high risk areas with a
total impact on available forestry stock of 19,000 M € after 20 years of an outbreak
and no regulatory control measures. Welfare analysis of the roundwood market,
in which its production represents 2,5% of forestry stock, demonstrates the ability of
the producers to pass most of the negative impact to the consumers by charging higher
prices. Reduction in social welfare estimated at 2,043 M €, where consumer surplus
decreased by 2,622 M € and net producer surplus, affected and non-affected producers,
increased by 579 M €.