I would appreciate some light on my current ignorance about getting into logging

[teakwood]

ehp:  you hit the nail on the head!

If you have no experience outside a first world country dont even try to start something in the third world. they chew you up and spit you out and you get sent home but without the money you brought.

[lopet]

Maybe I am missing something here.
Don't know how it's done in your country, but if you want to borrow that kind of money around here, to invest in a third world country, that will definitely  raise a  bunch of red flags, even with a very detailed business plan.
On the other hand, if you have this funds sitting in a bank account waiting to be spend, why taking all this risk ? 

[LumberLarvae]

I would recomand that you dont invest that kind of money in those country's. i give that investment a 80% chance to fail.
Very good points said from the older well known forumits. Other thing that ocures to me is corruption, in these country's you have to know where and with how much you fill every hand.
I am swiss and i live now 13 years in Costa Rica, it tooked me at least 4 years to completely understand culture, language, laws and .....
With that kind of money i would by lots of land in central america and start with teak plantations! The investment is safe here and you can expect a very good return on your money. I dont know if you can wait 20years dough.

This is amazing, what kind of return (%) do you get?

[starmac]

Just curiosity on my part, but if you have had no experience with logging companies, and no experience with running a business in these places, what is it that drew you to the conclusion you want to invest big bucks in a start up operation there.

Not saying you should or should not do it, as I know nothing of value to make any type of decision, just curious about your thinking on the matter.

I'm thinking if I had 11 million sitting around, I would go a different route. Possibly a small woodlot, with some lakefront on a nice lake, A new LT40 with all the bells and whistles, a brand new skidsteer, and any other support equipment I think I might possibly want. A house and boathouse, crank the mill when and if I wanted to, fish when and if I waanted too, ebjoy a beer when and if I wanted too, and still probably leave the kids a few million to do as they wished with when my time came. lol

[LumberLarvae]

Just curiosity on my part, but if you have had no experience with logging companies, and no experience with running a business in these places, what is it that drew you to the conclusion you want to invest big bucks in a start up operation there.

Not saying you should or should not do it, as I know nothing of value to make any type of decision, just curious about your thinking on the matter.

I'm thinking if I had 11 million sitting around, I would go a different route. Possibly a small woodlot, with some lakefront on a nice lake, A new LT40 with all the bells and whistles, a brand new skidsteer, and any other support equipment I think I might possibly want. A house and boathouse, crank the mill when and if I wanted to, fish when and if I waanted too, ebjoy a beer when and if I wanted too, and still probably leave the kids a few million to do as they wished with when my time came. lol

I have a competitive drive with no strings, so I thought the logging world is the least limited and most open way of making money - the canopy is the limit. Where as oil will run out/become redundant one day etc. It seemed to me that there are 400 billion trees in 1 rainforest and with enough teams - making back a profit of even £10 on  each log holds infinite possibilities. I hope you can see how much my ignorance is shining through now, so what are your thoughts on this...?

[lshobie]

If you are going into business in Africa, much like asian countries or the middle east for that matter you should be prepared to lose what you have invested, those are very unstable "business" environments where you can be in business one day and have the doors shut on you the next with nothing but a plane ticket home.  You can hire "consultants" but finding the right ones will be very difficult and for someone new in the business you will have a very expensive learning curve. 

I am an entrepreneur and love new ventures but I never undertake one without knowing I can lose my whole wad (bundle of cash).  That being said I do my homework extensively before jumping in.   I do respect your initiative though...sounds like fun!  If you ever need someone on the ground overseas let me know, I'd be in for a new challenge.

Or just hit the roulette table and put it on black...don't do red....i tried that a few weeks ago and it didn't work out for me.

Cheers and good luck.

Louie

[starmac]

I like the competitive spirit, and like I said I have no knowledge in what It takes to do business in those countries, and even more keep the business.
I also have limited knowledge in logging in general, learning everyday more on our local type logging in this area, where the wood has a certain amount of worth, that wouldn't support that kind of investment, so two whole different animals.
The deal here is logging is more a way of life, than a big money thing, not saying that is a bad thing, as it is a good way to live and make a decent living, but it is on a small scale, a really small scale compare to anything like you are talking about.
Our good logging areas are so far back now, that even if we had a large market for logs, you can't get enough trucks to support any type of high production logging. The wood is just worth so much, so truckers can only charge so much, so no incentive for either truckers to go out and buy logging trucks, or even the loggers to own their own and pay what it takes to keep good drivers. Which leaves it to those that enjoy the lifestyle, or at least that is my justification for hauling logs, when everybody thinks I should be out makeing money. lol

[GAB]

For me this has been a very interesting thread. 
Personally if I had that kind of scratch available to me the wood business is the last area I would consider investing it in.
Concerning your statement: "making back a profit of even £10 on  each log holds infinite possibilities."  I think you got the decimal in the wrong place.
Gerald

[BHC]

you got to start with your markets, and work backwards to figure out if this will work even on paper.

Here in Maine we have the forests, we have the trained labor, we have the equipment to cut and transport the wood, we have government regulations favorable to cut the wood.

But the Mills are struggling find markets and process the wood at a profit, and there shutting down left and right.
logging has been a global business for quite some time, the finished wood products from here go all over the world.

I see the value of wood dropping here not just in Maine but over the whole northeast over the next 10 years.

That said i think one of the strongest mills here in Maine at this time is SAPPI -south Africa pulp and paper
I would suggest if your interested in starting a logging business in Africa to find a contact with them, but there website suggest they produce most of there own wood.

On the other hand you could invest that kind of money in north America wood industry more on the side of processing the wood than the logging aspect, and probably come up with a more solid investment, but it still requires finding the markets.

[LumberLarvae]

Quick question for you guys, you all claimed how volatile logging in these areas would be, but what if one was to buy land in these areas.. would one still face all of these problems?

[SwampDonkey]

How many threads??...I could pull them up from deep within the forum.... have I read over the years with the same plot line? A greenhorn ain't going to Africa to log timber. What knowledge do you even have of the industry let alone species of saleable trees and markets? You really do need to be where things are stable to invest that kind of money. Unless there is skilled labour in running and maintaining the operation there will be a lot of expensive on the job training and probably paying someone (s) to come get you out of a hard spot. Because there will be lots of false starts and serious errors made. It is very high risk and low chance of any significant return. What does your family think of all this? The idea is interesting, captivating and down right imaginative but that's where it ends, quite frankly.   

[CCC4]

Dangit!! Did we get trolled? How embarrassing   

[beenthere]

Quick question for you guys, you all claimed how volatile logging in these areas would be, but what if one was to buy land in these areas.. would one still face all of these problems?

Which country in Africa? 

[LumberLarvae]

Dangit!! Did we get trolled? How embarrassing 

I simply explained my circumstances and asked for some advice from a field of people that I believe are very acute in this area. Nothing more nothing less.

How many threads??...I could pull them up from deep within the forum.... have I read over the years with the same plot line? A greenhorn ain't going to Africa to log timber. What knowledge do you even have of the industry let alone species of saleable trees and markets? You really do need to be where things are stable to invest that kind of money. Unless there is skilled labour in running and maintaining the operation there will be a lot of expensive on the job training and probably paying someone (s) to come get you out of a hard spot. Because there will be lots of false starts and serious errors made. It is very high risk and low chance of any significant return. What does your family think of all this? The idea is interesting, captivating and down right imaginative but that's where it ends, quite frankly.   

I had no true intention of spending ANY of my capital without doing as much research as I could; the money is not even fully accessible to me yet - I just wanted to think/do something outside the box and make the best investment I can. If I can. I posted here to see the depths of what I did not know.

I'd like to thank you all for posting, whether any of you believe if your advice has helped me or not, is up to yourself. I look at this thread as another golden nugget of information on this forum that anyone can access If they are in a similar situation to me or for those that are just curious  :P

Quick question for you guys, you all claimed how volatile logging in these areas would be, but what if one was to buy land in these areas.. would one still face all of these problems?

Which country in Africa?

Uganda, Nigeria, Ethiopia or maybe even parts of Brazil, Indonesia... Australia instead? - first to log and clear, then to plant a eucalyptus (fast growing) genus to harvest for pulp...?

[teakwood]

forget eucalyptus. Bad tree, low price, needs tons of chimicals for insects, you need tousands of acres to even get in that business.

I would recomand that you dont invest that kind of money in those country's. i give that investment a 80% chance to fail.
Very good points said from the older well known forumits. Other thing that ocures to me is corruption, in these country's you have to know where and with how much you fill every hand.
I am swiss and i live now 13 years in Costa Rica, it tooked me at least 4 years to completely understand culture, language, laws and .....
With that kind of money i would by lots of land in central america and start with teak plantations! The investment is safe here and you can expect a very good return on your money. I dont know if you can wait 20years dough.

This is amazing, what kind of return (%) do you get?

Ok i will speak in hectares (1ha=2.5acres)

you can buy land easily in central america, Costa Rica, Nicaragua or panama i would recomand, their all good for teak plantations (some regions!) Costa Rica is very expensive but your investment is 100% sure, Nicaragua and panama are a lot cheaper. Nicaragua is less stable and panama you wont find people who wants to work.

First you have to buy land, 2000-5000$/ha in Costa Rica. Plant teak and precommercial thinning at 5 years, commercial thinnings at 9 and 13 year, final cut 20years.  Its cost us around 6-7000/ha until final cut. return (first thinning (9 years/ 300-800$), second thinning (13years/ 1200-3000$) final cut 20 000-40 000$)
All depends on how much maintenance you make and how the soil is, climate zone your in, ....

[ehp]

Troll or no troll I think its good to put stuff out for others that want to try , other thing no one has talked about and I have seen this happen is once you get a business up and running where your making money the gov. of that country walks in and takes over and tells you to hit the road , you leave everything you have in the country and walk. Seen this in South America

[LumberLarvae]

forget eucalyptus. Bad tree, low price, needs tons of chimicals for insects, you need tousands of acres to even get in that business.

I would recomand that you dont invest that kind of money in those country's. i give that investment a 80% chance to fail.
Very good points said from the older well known forumits. Other thing that ocures to me is corruption, in these country's you have to know where and with how much you fill every hand.
I am swiss and i live now 13 years in Costa Rica, it tooked me at least 4 years to completely understand culture, language, laws and .....
With that kind of money i would by lots of land in central america and start with teak plantations! The investment is safe here and you can expect a very good return on your money. I dont know if you can wait 20years dough.

This is amazing, what kind of return (%) do you get?

Ok i will speak in hectares (1ha=2.5acres)

you can buy land easily in central america, Costa Rica, Nicaragua or panama i would recomand, their all good for teak plantations (some regions!) Costa Rica is very expensive but your investment is 100% sure, Nicaragua and panama are a lot cheaper. Nicaragua is less stable and panama you wont find people who wants to work.

First you have to buy land, 2000-5000$/ha in Costa Rica. Plant teak and precommercial thinning at 5 years, commercial thinnings at 9 and 13 year, final cut 20years.  Its cost us around 6-7000/ha until final cut. return (first thinning (9 years/ 300-800$), second thinning (13years/ 1200-3000$) final cut 20 000-40 000$)
All depends on how much maintenance you make and how the soil is, climate zone your in, ....

You explained that very concisely; I have been looking for a breakdown like that everywere, that was brilliant :D

Can you do the same to explain the maths behind the eucalyptus and profits/expenditure you'd generally see with it (just estimates)?

[teakwood]

I cant.

Teak is my buisness, my life project for the last 11years, so i know a little bit about it. I dont deal with eucalyptus so my info would be unreal.

[Gearbox]

Do you understand why we log . It sure isn't to get rich . At 70 years old I still want to see the sun come up at 20 below zero crank up the saw and work till a slidder warms up enough to start . This is why I have logged since I was a young boy and will till I can't .

[CCC4]

Do you understand why we log . It sure isn't to get rich . At 70 years old I still want to see the sun come up at 20 below zero crank up the saw and work till a slidder warms up enough to start . This is why I have logged since I was a young boy and will till I can't .

Aye!! (except the 20 below  )