Viability of artisanal timber milling: cases from Ghana

Purpose - A key strategy in the policy of saw millers and artisanal millers supplying the domestic market with legal and sustainable lumber is the transformation of chainsaw operators into legal artisanal millers to stop the production of illegal timber and supply only authorized wood to local trade points. The challenge, however, is how to develop the concept of its viability and acceptability to the chainsaw operators. Specifically, existing and potential investors’ knowledge about the possible costs and revenue is non-existent. This study aims to examine the financial and economic viability of the artisanal timber milling (ATM) business in rural Ghana. Design/methodology/approach - Using data from three operational artisanal milling companies in Ghana, net present value, internal rate of return, profitability index and payback period were used in analyzing the viability of artisanal timber milling. Findings - The results showed that the ATM business is financially and economically viable, attractive and profitable. Social implications - ATM business has the potential to create more jobs in the timber industry, reduce illegalities in the forestry sector and improve the living standard of individuals used by the sector. Originality/value - As part of ATM’s medium and long-term strategies, the study encourages stakeholders to consider assisting existing and potential actors who have the passion to venture into this business to acquire concessions and financial support from financial institutions.