This paper develops a simple two‐period present value maximizing model of forest management. The production possibility is determined by the initial forest endowment, a growth function and transformation relations between thinnings, final fellings, pulpwood supply and sawtimber supply. The model is applied on thinnings and final fellings data of three different ownership categories in Sweden; private industrial, private non‐industrial and public owners. The results show lower price elasticities than previous studies where no distinction between ownership categories are made. Also, a previously unused inventory variable seems to have an important explanatory power.