Timber sales

Ron Wenrich woodtick at lebmofo.com
Sun Jan 4 02:42:12 EST 1998



ForestFair wrote:

> >bobndwoods at aol.com (BOBNDWOODS) wrote;
>
> > These guys are right....get a good consultant.  Generally
> speaking, you will make 20-25% more on your timber sale.  More than pays for
> their commission. <
>
> Bob,
>
> You're right about getting a good consultant, but the numbers are even more
> favorable where I am (NYS).
>
> Most people using a consultant will get *at least* twice as much as they will
> from the logger knocking at the door or working down the road, and often
> several times more.  Landowners here are not  usually approached directly by
> industrial foresters or timber buyers.
>
> Most likely there  will also be fewer trees cut,  leaving good trees to grow
> for future harvests, and less damage to the site.  But consultants here get
> 15%, and I think someone said that 10% is common in the south?
>
> ForestFair

What a difference a few hundred miles make.  In PA, there are a lot of
procurement foresters that knock on a lot of doors.  Most landowners, with
timber, have been approached by several mills.  Our largest mill cuts about 30
MMbf annually, and buys no consultant timber (pays about half the stumpage
value).  Timber buyers must buy 200 Mbf monthly or they are canned.  The
foresters must mark 400 Mbf monthly with a 25% overrun.  Mgmt practices depend on
the ethic of the marking forester, but mostly cut and run.  This mill has a 200
mile radius, cutting timber in 6 states (PA,NJ,MD,DE,VA,WV), and at one time was
up in NY.

Another mill cuts about 18 MMbf, and buys very little to no consultant timber.
Their prices are much better, and are often as good as consultant prices less
commissions.  Quality of work is usually adequate.  This is an Amish run mill, so
I don't know if this ethic makes the difference.  When these two mills go head to
head, the landowner usually fairs pretty well.

Most medium and small mills get a good deal of wood from consultants; however, a
lot of  landowners still go directly to the mill before they will go to a
consultant.  Some mills pay a good price, some don't.  Some do good work in the
woods, some don't.  Its an ethic thing, and it sits on both sides of the fence.

Its a real joy to watch the two larger mills go head to head on a big tract of
timber.  They both have a ton of money to throw at a sale, and when their egos
get in the way, they try to screw the other guy into paying too much for the
timber.  One wins and the other loses; but the landowner usually wins big.

Consultants have been picking up timber which procurement foresters pass up.
This is usually due to size of the job (5-10 acre tracts), specie or grade, or an
access problem.  Small tracts often have very good timber.  Large tracts with
poor quality or an access problem has its own types of headaches, and often
consultants will pass on these.

15% is typical commission rate and on some sales it doesn't cover forester
expenses.  Landowners with good timber subsidize those with poor timber by
getting charged the same rate.  As Don states, marking costs are pretty much the
same for most tracts.  Why should landowners with good timber be charged more per
Mbf for a sale than one with poor timber?  That's a problem with flat rate
commissions on all sales.

RDW





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