I have about 6,000 small (12"-16") straight, planted, maintained Black Walnut trees on a flat easily accessible property. The question is what is the best way to market these trees with this large of quantity. There is a lot of good wood here that has value, but I don't know how or who to talk to maximize that. I've considered portable sawmill contractors, but again, I don't know if this the right approach.
Paging native wolf
12" across or around?
DBH
Seems to me you are potentially throwing a lot of money away doing a harvest at that size. A few more years and the volumes could be tremendously more, assuming the trees are growing on a good site.
The problem is that I'm running out of years
I don't know much about walnut prices, but it seems to me that trees of that size are only going to have one low value log in em.
Would it be worth doing a thinning to release the crowns for better growth?
Quote from: 2602tderrick on December 27, 2017, 10:17:57 PM
The problem is that I'm running out of years
What is your location? A couple of years can be a big difference. Central states (Missouri, etc) have some good rapid growth and that size has optimum potential.
Is selling a portion of the land feasible? It ought to fetch a premium over premium with the next owner knowing that its on the brink of prime walnut. Maybe sell to a walnut specialty manufacturer?
Think about selling the land. I have seen young walnut groves like that sale on land sales. It's a great long term investment for someone, maybe just not for you. Just a thought
Hi, chiming in a bit later than normal on a walnut thread :D.
First, what's the general location?
The thought of selling, or leasing, the walnut stand is a good one. Over the next 10 years the larger trees will start to become valuable but right now there is very little board foot volume there.
Issues: When you sell these logs the diameter is measured from the top, not the bottom. If you have a normal tree taper in a planted walnut stand a 16" diameter tree will be 12-14" at an 8' log. They taper quickly. So, the 12" trees become 10-9 inch trees and you have basically a bunch of $20 logs there. If you want to sell $20 logs there re lots of buyers, I'd buy them but I'd try to let them sit in the ground 5-10 years and add 2" in diameter. The $20 log will become a $100 log, etc.
Secondly, can you take some pictures and put them in the gallery?
I'm not the only buyer here, some in PA some in IL, etc. We'll help you find someone to get bids from. I'm just worried that it is the wrong time to harvest but maybe not a bad time to lease the plot.
Where I sell logs anything under 10" on the small end brings $150 per thousand but haven't tried to sell any small walnut. Did sell a small white oak. Eight ft. long and 8" on the small end. Brought me a whopping dollar. What you have in my opinion is not much in present value but in the long term a tidy sum
This thread brings up several questions regarding the future of black walnut prices & forests. Has the quality of walnut stands seriously diminished due to the record prices for the wood? Has it been harder to find exceptional stands with quality veneer logs than earlier when this market really started taking off?
If so, could this decrease in future supply help inflate or sustain current black walnut prices in the future?
The responses to the original post indicate waiting until these trees gain more DBH... I'm wondering what you might think about the future supply and demand of this species when this stand becomes prime for harvest. Not trying to ask a crystal ball question, just gauging experiences with mainly future supply quantity and current demand.
Scrap is a similar market to compare. The volume available is finite, the amount sold by those who have it is directly proportional to the price paid by those who want it, and due to global transit networks far off demand influences entire world price. the life cycle of new iron product isnt so different from growing timber.
In scrap, decades of low price generated a glutton of supply. A decade of booming chinese purchases created a huge american demand which peaked prices and vacuumed out the piles behind every shed. The crash in prices means the stockpile grows again. We should think of the 1990s as selective scrap thinning and the 2008 peak as a clearcut. The bottom of prices thereafter is like max regen in a timber stand. At a penny a pound no one is hauling scrap so everyone has a seedling pile started again.
Walnut supply is probably very low right now because of peak bubble pricing. If the wood goes out of favor.. Like say poplar did 70 or 100 yrs ago, demand crashes, prices crash, loggers stop seeking it. Walnut doesnt get cut and thus stands will grow back to prime sizes.
If the bubble never pops, very few land owners will wait to grow prime sized walnut. The price isnt assured 20 yrs from now so one in the hand...
A forester can help analyze the situation and can assist with the sale as well. At a minimum, get multiple bids from loggers. Adding your location would help...
Do you need the money? If so, a thinning cut would bring in some. Cut the worst and let the best get bigger. If you need more $ than that, then sell some land post thinning. Walnut can turn a better interest rate than many investments and yours are almost to the point where that compounding matters!
If you are wanting the land cleared, a clear cut sure beats paying a dozer!
We are looking at doing a thinning cut on a tract of similar sized Walnut to push the good ones up in size and hopefully grade. I have a couple mills, but right now I'd get paid more as logs than I would get for the lumber AND with reduced labor. I do look forward to the cut-offs though. ;)
Markets can be fickle. My personal opinion though is that there is not enough Walnut to get "overused". It's never been enough of a fad for it to ever fade as it is largely supply constrained. Prices will go up and down, but I expect Walnut to retain a premium over other woods a long time. Just maybe a smaller premium in the future.
As for disease, Thousand Cankers is about it from what I've read. And it doesn't damage the lumber when the tree dies, just makes it hard to transport due to quarantines. Haven't been able to find many updates on it lately (I've looked), so I'm wondering if the quarantine is having an effect...
I can't think of a time that walnut was dragging in price. Sometimes the sellers have too high of expectations, especially for the quality of wood being offered. Veneer has always brought in big bucks. With better technology, the veneer can be cut thinner, and recovery can increase. But, there is a limit. Veneer needs to be about 14" dib. Form class is a way of estimating the dib at 16'. Form class of 78 would mean that a 14" log would have about a 11" dib. You might get a 12" log at 8'
The increase in value would be pretty substantial in the next 20 years. The foreign demand is driven by China. They have allowed home ownership, and walnut is in demand to break up the white wood that is typically grown in China. Also, the European markets create a good demand. The alternative woods tend to be tropical hardwoods.
As an alternative to cutting, you could sell the land with timber attached. A forester could give you a current value and an estimated value at certain age intervals. You could also give it to your kids or grandkids.
Has, anyone ever seen an arrangment where an investor can buy the timber standing at its current value to satisfy the financial needs of land owner, and then assume the profits of a more mature stand down the road. Of course there would be many types of risk as well. I could see where that might be a complex deal to make.
In tennessee mineral rights to a parcel are sold all the time. Id imagine timber rights could be done too.
Timber rights! Of course! This is why Jeff is our fearless leader.
Timber rights is something I've been learning about. Rights can be sold either in perpetuity or for a given period of time, like a long term logging contract.
It's not as fluid as the log market, but if you find the right buyer, you could potentially get a premium over what you currently have.
Just to put some numbers to what everyone has been saying. A 10" (small end) log, 10' long has 30 board-feet using the Scribner log rule. Let that same tree (log) grow to 16" and it now has 100 bd-ft. At 20", 170 bd-ft. Your trees are right at the point where they start adding valuable volume in a hurry. A thinning operation might be best depending on stocking levels but these things are almost impossible to evaluate over the net.
Find yourself a decent consulting forester and have him look at the property. If you're in MO, I have contact information for the consulting forester who does walnut.
Clark
Quote from: Jeff on December 29, 2017, 06:30:43 PM
Has, anyone ever seen an arrangment where an investor can buy the timber standing at its current value to satisfy the financial needs of land owner, and then assume the profits of a more mature stand down the road. Of course there would be many types of risk as well. I could see where that might be a complex deal to make.
Jeff, that is a common contract actually. Long term timber lease agreements, especially common close to pulp mills back in the 60s to 80s when pulp mills wanted to guarantee supply.
NE Kansas. From what I'm getting back from the Forum, maybe I should have someone look at them. I'm not sure how to, or who to talk to, that would give me a straight answer.
The idea of selling the land with the trees on it looks appealing. Would I need to do a full inventory in order to get this going. They are ALL not small, just the majority, maybe 50 14-16" 5 or 6 20"-24" of the 6,000
Quote from: Jeff on December 29, 2017, 06:30:43 PM
Has, anyone ever seen an arrangment where an investor can buy the timber standing at its current value to satisfy the financial needs of land owner, and then assume the profits of a more mature stand down the road. Of course there would be many types of risk as well. I could see where that might be a complex deal to make.
A guy up the road a bit put 11 acres of field into pine two or three years back, under a 25 year contract at the time of planting, personally I don't see how such an arrangement can actually pan out for the small landowner but time will tell.
Can someone walk me thru posting pictures of the Black Walnut trees. I have them on the lap top but I'm instructed not to simply attach photos
Yes, this is the last item on the Index Page: Picture Posting on Forum Help (https://forestryforum.com/board/index.php/topic,61788.0.html)
Give it a shot and then if you need help, just ask. :)
Theres a guy pretty local to me with the biggest logging outfit im aware of, definitely looks the most successful. Hes known for making offers on timber, and if he gets a no... Making offers on land.
Go on your states GIS parcel viewer and look at the biggest blocks of land around.. See who owns them. Then market direct. Its typically a "neighbor" willing to pay the most for a plot for some personal and emotional reason of their own. Want it for family or to expand the farm or gravel pit or timberstand or hunting reserve etc. The guys with the most land around have the most equity to leverage at the bank. I would also go to sawmills and walnut end users trying to find my buyer. A "walnut stand for sale" ad on the sawmill bulletin would reach your target market pretty fast. Mill would be crazy not to let you put it up as they stand to make money sawing or yarding it if one of their customers brings it in.
Type in "standing timber" on craigslist, buyers usually post there.
This sounds like a solution, so I determine approximate MBF of the timber right now, then use projections based on recorded growth rates. Then what, who do I talk to? Everyone sees this as I do, a 10-15 year investment would yield $$$
Talk to everyone and anyone until you find your sale.
Real Estate brokers and forester/appraisers would be a start.
A forester should be able to appraise the value and potential future value.
As for real estate agents, you want one that specializes in land (Farmland, investments, and recreational). Your perfect buyer may be someone who wants the land for recreational use, but can use money from an IRA to fund the purchase as a timber investment. There's an agency our way that specializes in this type of property and they seem to be expanding. Mossy Oak Properties. I bought my moulder from a guy in KC who is an agent for them.
You say NE KS, if you are within about 2 hours of KC (Or maybe Omaha), this would certainly be something to pursue. (Lot's of KC traffic in my area to the Lake of the Ozarks every weekend at a 2-3 hour drive.) I see rates on hunting leases going up lately and lots of people with money looking for that land where they can groom a trophy buck.
Farm Credit is a rural land lender here, they actually dont underwrite residental land. Might wanna call them if theres one in your area.. See who is buying working forest.