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is this the new trend??

Started by red oaks lumber, March 16, 2011, 09:04:26 PM

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red oaks lumber

it seems that since the bottom fell out on the economy , logging almost became a thing for the history books. the new trend around this area appears to be that all the loggers are contract works for 3 big mills, paid to put wood on the landing.this must be a good deal for the logger not trying to find wood or trying to market your products.
here comes the delima for small mills like myself, can't buy any wood on the open markets, example there was a pine sale maybe 2 miles from the shop couldn't buy any all has to go 80 miles away does this madness make any sense? or is this only happening in my arrea. the other part is not nearly enough competion for bid sales(price fixing?)
the experts think i do things wrong
over 18 million b.f. processed and 7341 happy customers i disagree

lumberjake

It's like that where i am. My family has been in the lumber/timber business for 50 yrs and lately we have been seeing mills from north of us coming down and bidding on timber and honestly leaving a ton of money on the table and then have to truck it three hours away. It's hard to understand how some of these mills can make any money putting crazy prices on timber and then trucking it that far when the markets are the way they are. I know what our fuel costs are when we try to stay within a 30 mile radius of our mill and even at thirty miles it kills your profits hauling with a tri axle

chucker

when a small country owned mill(s) cant out do a million bf operation with a couple million dollars to help the fuel bill theres no equalization to the equation!! its like past history repeating its self over again, "go big or quit" ! the only other option is to do the best with what you have and make the best of the situation... small is good.
respect nature ! and she will produce for you !!  jonsered 625 670  2159 2171/28"  efco 147 husky 390xp/28" .375... 455r/auto tune 18" .58 gauge

CX3

Same thing here.  Guys coming in from over 100 miles, paying more than I want to give and trucking it back home everyday.  I have no idea how they do it.  Im guessing they dont, theyre just staying busy. 
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weisyboy

its been like that here for years, sawmills find trees and apy a contractor to cut them and snig them, loggign contractors will still get padocks of logs themselves but normaly just send them to the mill they contract for or whover will take them at the best price, and eaysest deal
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Ron Wenrich

I see a mixed bag in my area.  We have a couple of large mills that buy timber and have it contract logged.  But, they also buy gatewood, so that makes them in competition with themselves.  The big mills have their own foresters and will buy on the stump more often than buying marked wood.  Most often their contract loggers are put on a quota system of a certain minimum per week.

Since the downturn, the big mills have not been buying much stumpage and those contract workers were let go.  You don't see their trucks on the roads nearly as much as 5 years ago. 

The independent logger has more markets and will work many sales that the big ones won't.  Good loggers make their money marketing wood, not by cutting it.  Those guys are still in business selling anything from veneer to pulpwood.  They can still beat big mills on bid sales, and, in most cases, don't even sell gatewood to the big mills.

What has shrunk is the amount of good wood on the stump due to the pressure from all the big mills and consultants trying to make a living.  They've been high grading for a couple of decades and its starting to catch up.  The better wood continues to be on the small tracts.  The big tracts are pretty well hammered.
Never under estimate the power of stupid people in large groups.

northwoods1

Quote from: red oaks lumber on March 16, 2011, 09:04:26 PM


this must be a good deal for the logger not trying to find wood or trying to market your products.


Red oaks I am pretty close to you so I am and have been experiencing the exact forces you are talking about. It is not such a good deal for the loggers in a lot of cases, but when you can't afford to compete with the mills for the stumpage where are you gonna turn except to do contract work for them? You could pick away at the small jobs but if your operation is set up mechanized and you need to be producing wood you can't hunt and peck after jobs all over hill and dale and be setting up and moving all the time. I live in the Nicolet National Forest here and it has been a while since any of the local loggers here have been able to even touch a federal sale.
I see a lot of people, both loggers and sawmillers, and they get set up operating a certain way and things are good. Then times start changing... and some want to sit around and lament about the good old days and scratch there head wondering how others can pay that kind of price for wood and still make out. I see it all the time and I think it is one of the biggest pitfalls to some small operations. The key is you have to be ever changing, flexible. This situation you talk about with the big mills going out and buying stumpage and contracting the cutting... that is the way it used to predominantly be around here 40 or so years ago. But they went away from that for whatever reason probably because the economy dictated that there was a cheaper and easier way. Now the economy dictates something different for them. My guess is that buying there own stumpage allows them to be certain they have the supply they need without having the "headache" :D of dealing with a bunch of independent suppliers. Which can be a great uncertainty.
What you need to do is what they are doing. Roll with the changes. Get more creative. There are advantages to being small. It is easy to overlook that and want to just think about how good things used to be, but you won't survive that way. You need to be able to find the golden lining in every situation.

mad murdock

It almost is like the big players have cut out the small guy from playing.  Same thing has happened in a lot of industries, do you see any smaller coal, or other natural resource based companies out there anymore?  Heck, even the family dairy farm operations are going because it is too hard to make a go with a small operation.  Government tampering with the markets, or in this case, locking up the resource so that only the big boys apply.  Just like all of the oil that is locked up  and controlled by federal oil leases.  Cut off the people from the resource, and control the masses by controlling the resource.  Just my  take on it.
Turbosawmill M6 (now M8) Warrior Ultra liteweight, Granberg Alaskan III, lots of saws-gas powered and human powered :D

red oaks lumber

northwoods, i have been rollin and changin but, when i can't buy wood for my mill then i might as well quit cause go big or go home is the exact thing killling our country.
the experts think i do things wrong
over 18 million b.f. processed and 7341 happy customers i disagree

northwoods1

Quote from: red oaks lumber on March 17, 2011, 01:02:23 PM
northwoods, i have been rollin and changin but, when i can't buy wood for my mill then i might as well quit cause go big or go home is the exact thing killling our country.

Red Oaks I hear what you are saying. Do I ever! I've about given up at trying to stick with this business personally.

Basically... I have resolved to learn how to live in a modest way and be happy with it, mostly so I can spend my older years going fishing and not have to worry about it. That may sound like a smart *&% reply but I am serious.

You can stay in business though if you want to.

The proof is in the fact that there are still people wanting to get into the industry on a small scale. I can look at logging for instance... there are young guys out there that are starting from scratch and wanting to work in the woods. They don't know what it "use" to be like, they only know the conditions that exist now. So they forge on ahead with the conditions that exist now not having any alternative.

You need to decide if it is worth the effort. You look at how the big companies operate and you will see that they continually have to be changing as the economy dictates. You need to do the same there is no alternative. What Mad Murdock is saying about how everything is becoming geared towards the big producer... well that is so true in every aspect of our lives. We are living in a unique time I believe.

In order for the small producers like you and I to keep going we will have to figure out how not to be competing with the large companies.




chucker

Quote from: red oaks lumber on March 17, 2011, 01:02:23 PM
northwoods, i have been rollin and changin but, when i can't buy wood for my mill then i might as well quit cause go big or go home is the exact thing killling our country.
hang in there bud!! this is what kills most of the big wheeler dealers as well , like a long length of rope ! give it time and us smaller wood lot loggers will prevail in the end ... big means pay my price or else!! when this happens it will hang them with the might of the mass's of the little guys again... sounds likly in a way that hurts in the mean while but it always comes to the same end when the "PIGS" try to corner the market!!! the storage yard just half mile from me is full now must be close to 10,000 cords in trust to the future markets... i will try to get a few pictures of this huge stock pileand post... you can catch the photos of the log yard in my album....
respect nature ! and she will produce for you !!  jonsered 625 670  2159 2171/28"  efco 147 husky 390xp/28" .375... 455r/auto tune 18" .58 gauge

mad murdock

NW1 et. al. I agree with you guys wholeheartedly.  If a guy goes at it with his/her eyes open, and can think outside the box, you can carve a niche for yourself, and do ok.  My older brother and I did that for a period of time a little west of where NW1 is, (Vilas Co. area), and we did ok.  Had I not gone back to my aviation job, I know I could have developed that market, and maybe diversified on a small scale, like NW1 and kept at it for a long time.  We would find ways to market wood that the "traditional" logger may not think of, like cutting white cedar "rail" stock for log home builders, peeling it, and selling it for $1/linear ft. Then using horses to drag out high value logs on small lots, and other things.  I think that the biggest thing is to have an open mind and not get in a rut as to what one is doing.  By having flexibility, and being able to adapt to emerging markets, I don't think you have to go big, or go home, you can stay and tough it out, and you will be able to produce something that you can use to put food on the table not matter what comes.
Turbosawmill M6 (now M8) Warrior Ultra liteweight, Granberg Alaskan III, lots of saws-gas powered and human powered :D

240b

I just focus on the smaller lots owned by folks who don't want huge equipment on there property. Most of the bigger lots around here have be pretty well worked ,twice, now since the mid 90's.  We have the mill scabs here but they are the guys who can't get work on there own.   I certainly wouldn't want to be starting out in todays world, but a couple young guys are, they just don't know any different.  The fellow who bought my old grapple skidder did so because he claimed he needed to pull more wood to make it.... well after four years with that he just traded up to a 535 with the same justification "need to pull more wood"  ahhhhh, ok have fun..  I guess I am missing something. 

SwampDonkey

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1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

banksiana

With the limited market, it is surprising to see a mill and a local logger bidding against each other, when in the end when the mill outbids the logger, the logger ends up contract cutting the sale for the mill anyway.  Seen some strange things.

chevytaHOE5674

The mill I work for consumes 30,000+ bdft of logs daily. We only have 2 of our own timber sales going all the rest is gatewood. The gatewood is a mix of private and public timber sales both small and large. We have suppliers that are single man crews all the way up to fully mechanized with 5+ guys working. Wood coming in ranges from 9000ft michigan double truckloads down to guys hauling logs in with tandem axle trailers.

There are at least 4 other mills close competing for the wood.

Mark K

I've been contracting for a mill for about a year now full-time. When we had the farm I did some on and off. I made more money doing private lots on a percentage cut but it became a hassle trying to find work. I still cut once in a while for private landowners and have cut some woodlots again that I selective cut when I started logging. Its hard to compete with mills around here so I figure if you cant beat um, join um. Its nice not having to wait for trucking or line up trucking because jobbers come first with this mill. I dont have to clean up when done, just go in and cut. They take care of it. No matter what markets are I make the same per thousand. It bothers me a little when I get a job that is loaded full of nice hardwood and I think what I could of made on my own. But then I get a job full of ash, basswood and hemlock. It all averages out.
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red oaks lumber

from when i started my sawmill/reman buisness 15 yrs.ago there is not alogger still operating or only contract cutting and i can think of somewhere around 90-100 loggers.
i annualy buy 2-300,000 b.f saw logs not a big number but still, this is america i think.
i do work with a horse logger i try to buy as much wood from him as i can but, how much wood can a horse logger put on the landing in a day? i won't give up trying  altough i have been shifting gears and am doing alot more milling reclaimed lumber.
the experts think i do things wrong
over 18 million b.f. processed and 7341 happy customers i disagree

redlaker1

up where I live,  in northwestern ontario,  there are no sawmills running as far as I know.   the only wood getting cut is going straight into a chipper in the bush and hauled to the mill.     the only paper mills still running are only accepting chips.     so its the little stuff right on up to the nice sawlogs getting fed treelength to the monster chipper.   kinda sad really

no small outfits running around here,   except for the odd small firewood guys

chucker

  theres a logger just north of me that is chiping everything to go to the power plant ! i asked him about 100" oak in 10/12 cord loads for firewood and said its not worth it to deliver? what hes getting for chips is an even 500.00 per trailer load delivered?? knowing this i would take 4 to 5 loads real quick at that price ! price meaning he wont sell firewood for a better price is hard to figure.. oak stumpage is going for 35.00 around here and figure time and fuel plus a guys time cant cut it fot 600.00 ! so why would he sell for 500.00???????????? hes making 300 mile round trips and im only 20 miles away....
respect nature ! and she will produce for you !!  jonsered 625 670  2159 2171/28"  efco 147 husky 390xp/28" .375... 455r/auto tune 18" .58 gauge

SwampDonkey

Chucker, sounds like someone on a contract and not a big producer. Volumes through the gate has to meet set targets in a timely fashion. If he starts side deals he might run behind on deliveries. All kinds of guesses.  ;D Sometimes a contract is more valuable to people because they haven't got to drum up business on smaller, short term deals. But then again, some people don't realize (or become numbed) as to how bad they are being hit with the stick. :D
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

chucker

  hey sd! the guys a long time logger, doing around 5 to 7.5 k,s a year so hes not a dope being struck in the head by a stick? just sounds to me the way the economy is that a fast turned buck with all the saveings to be had would turn a better profit ... there have been many offers to buy truck loads but not selling? his price is cheap at most as other loggers are trying to sell their product for a 90.00 cord(100") so hes way cheap!! maybe hes getting tired and wants out...
respect nature ! and she will produce for you !!  jonsered 625 670  2159 2171/28"  efco 147 husky 390xp/28" .375... 455r/auto tune 18" .58 gauge

SwampDonkey

Chucker, as I said. Just a WAG. ;)
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

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