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Author Topic: How do people calculate their lumber prices?  (Read 1114 times)

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Offline newdesertfox

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How do people calculate their lumber prices?
« on: January 09, 2018, 11:50:35 AM »
Im newer to sawmilling but getting the hang of it, but my main trouble is figuring out lumber prices, more specifically hardwoods as it always seems like Im behind the 8 ball when it comes to pricing. Soft woods are pretty simple, junk wood 0.25-35 bf, 0.50-65 for normal wood. But hardwoods its seems I either end up under pricing or over pricing, for large beams I've tried $2 bf as its what other large sawmills charge. But I had a person looking for a trailer load of living edge slabs around 19-29" wide, 2-3" thick, and 14' long, I priced it at $2.25-$2.50 bf and never heard back from him. So Im curious as to how people found the most effective way to price lumber. My situation is a little different as most of my logs I have gotten are either from me deforesting or trading cutting hardwoods 50/50ish so I haven't had a cost per log to base off of so just looking for input. Thanks

Offline moodnacreek

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Re: How do people calculate their lumber prices?
« Reply #1 on: January 09, 2018, 01:06:00 PM »
Half the inquiries are just that. Half the orders I cut or pull are never picked up. Don't take down payments, get all the $ or know you can sell it to somebody else. Prices are determined by your competition  and you probably already know them.   If you want to do a big order and they want it cheaper; have them do something to make it better for you like spot their trailer right where you want it and hand over the cash as an example.

Offline starmac

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Re: How do people calculate their lumber prices?
« Reply #2 on: January 09, 2018, 02:37:33 PM »
If price is determined by competition, everybody will be sawing for free before long.

I wouldn't worry too much about calls that do not wind up being a sale, the guy may or may not have bought some cheaper, there are more folks in the beback crowd than are there actual buyers.
Old LT40HD, old log truck, old MM forklift, and several huskies.

Offline newdesertfox

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Re: How do people calculate their lumber prices?
« Reply #3 on: January 09, 2018, 03:02:29 PM »
Alright thanks, personal opinion in your operations would that price be high for slabs that size out of red oak? Curiosity 

Offline Kbeitz

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Re: How do people calculate their lumber prices?
« Reply #4 on: January 09, 2018, 04:15:54 PM »
I could care less what someone else is getting for there lumber. I just take my
time and what I got into my logs and add my time to it and cost and sell.
Collector and builder of many things.
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Offline WDH

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Re: How do people calculate their lumber prices?
« Reply #5 on: January 09, 2018, 04:35:58 PM »
Are you selling the wide, thick oak slabs green of the saw?  Or, are you air drying, kiln drying,. planing?  All this makes quite a difference. 
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Offline WV Sawmiller

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Re: How do people calculate their lumber prices?
« Reply #6 on: January 09, 2018, 05:23:25 PM »
If price is determined by competition, everybody will be sawing for free before long.

   I nominate this astute observation as the best quote I think I have seen on the FF (Even better than "I just saws em and leaves em - which is a close second).

   Very well stated Starmac.

   Kbeitz is pointing you in the right direction. I'd consider his and Danny's (WDH) suggestions closely to help determine your pricing scheme.
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Offline newdesertfox

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Re: How do people calculate their lumber prices?
« Reply #7 on: January 09, 2018, 05:41:42 PM »
Just green rough cut, forgot to mention that, he wanted to take them to a kiln near him and dry/plane them, I know dried and planed they sell for around $20-30 bf so from what I could tell its about a 10x markup from rough to dried planed. kbeitz's suggestion sounds like a pretty good one, I know more then a few places in other industries have gone under from operating below costs to compete with other places that were selling cheap and also went under as well. Main downside is I haven't been buying logs so not sure on base costs to acquire (one advantage/disadvantage to deforesting some properties lol)

Offline POSTON WIDEHEAD

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Re: How do people calculate their lumber prices?
« Reply #8 on: January 09, 2018, 05:48:17 PM »
Question?

What caused you to think you are selling your hardwood to low?
What caused you to think you are selling your hardwood to high?

Don't let a customers attitude make you change your prices if you are competitive.
Some will pay your price and be glad and others will try to whittle you down.
Stay firm on your prices.
Where's the Spoon?

Offline Den-Den

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Re: How do people calculate their lumber prices?
« Reply #9 on: January 09, 2018, 06:33:54 PM »
Just green rough cut, forgot to mention that, he wanted to take them to a kiln near him and dry/plane them, I know dried and planed they sell for around $20-30 bf so from what I could tell its about a 10x markup from rough to dried planed.

Perhaps a one off thing but its hard to imagine that many slabs sell for $20 -30 per bd ft.  I have seen finished tables at nice retail stores for about that much (Includes table legs, sanding finishing and retail mark-up).  Also remember that drying defects will make a percentage of green slabs into junk that has almost no value at all.
You may think that you can or may think you can't; either way, you are right.

Offline WDH

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Re: How do people calculate their lumber prices?
« Reply #10 on: January 09, 2018, 07:40:20 PM »
From my perspective, for oak, if you are selling green off the saw, your price is very reasonable for those slabs.  If I was selling those, I would be a least that much.  About 3 times that if they were kiln dried to 8%, flattened, and finish planed.  However, like Den-Den said, if you took them all the way to dry finished, there will be losses due to drying defects like warp, cup, and splitting/checking.  My turn around time for 9/4 oak slabs from sawing green, to air drying, to kiln drying, to flattening, and planing is about 14 - 16 months.  I would never tie up my kiln trying to dry 9/4 oak from green, it would take months.  So, I always pre-dry/air dry first before finishing in the kiln. 

It does not matter that the logs are free.  They have a market value even if you did not pay it. 
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Offline WV Sawmiller

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Re: How do people calculate their lumber prices?
« Reply #11 on: January 09, 2018, 07:47:23 PM »
   I'd say not to worry about the mark up from rough green lumber to a finished product unless you have the skill, time, equipment, storage and transport along with the risk tolerance and acceptance for loss and want to provide the value added steps yourself. You are not comparing apples to apples. If you are selling green, hardwood live edge slabs you need to determine a price where you can pay yourself what you determine is an acceptable rate.

   Since you have a source for logs keep in mind what else you could sell the logs for if you chose not to sell them. Maybe raw form for pulp or to a big sawmill, maybe for firewood, etc. Don't discount/disregard their value just because you did not obtain them through a more stereotypical purchase arrangement. You have some cost in them even if you cut them yourself or hauled them from someone else.
Howard Green
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Dad always said "You can shear a sheep a bunch of times but you can only skin him once"

Offline JB Griffin

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Re: How do people calculate their lumber prices?
« Reply #12 on: January 09, 2018, 08:25:06 PM »
Heck If I could get 2bucks a ft for green red oak in decent quantity,  I'd order me a brand spanking new diesel Blue Streak and quit my job tomorrow.
2000 LT40hyd remote 33hp Kubota, 160 Prentice, Frick 2 saw gang edger, Wright W-37 ABG, Suffolk dual tooth setter, Cat claw single tooth setter,'96 F-250 7.3 PSD 4x4, CS-590 Echo, MF 20c, M681 Memo.

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Offline JB Griffin

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Re: How do people calculate their lumber prices?
« Reply #13 on: January 09, 2018, 08:27:06 PM »
I see a lot of lumber and slabs for sale for big money, but I don't see um selling any of it. :D
2000 LT40hyd remote 33hp Kubota, 160 Prentice, Frick 2 saw gang edger, Wright W-37 ABG, Suffolk dual tooth setter, Cat claw single tooth setter,'96 F-250 7.3 PSD 4x4, CS-590 Echo, MF 20c, M681 Memo.

Over 2 million bdft sawn with a Baker Dominator and counting.

Offline Lawg Dawg

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Re: How do people calculate their lumber prices?
« Reply #14 on: January 09, 2018, 09:24:05 PM »
Just don't start too low...you'll get someone buying everything you can cut for cheaper than you should have priced it. A good way to not make money  :'(
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Offline terrifictimbersllc

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Re: How do people calculate their lumber prices?
« Reply #15 on: January 09, 2018, 10:48:05 PM »
I charge enough to make me want to do it.
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Offline WDH

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Re: How do people calculate their lumber prices?
« Reply #16 on: January 10, 2018, 07:39:44 AM »
Heck If I could get 2bucks a ft for green red oak in decent quantity,  I'd order me a brand spanking new diesel Blue Streak and quit my job tomorrow.

That is the key.  I am not aware of a wholesale market for thick oak slabs, or for any thick slabs in truckload quantities.  My prices are single slab retail.  That requires a lot of effort to produce a flat, good quality slab for tabletops, countertops, or kitchen island tops.  If you are sawing for volume or the wholesale market at Hardwood Market Report prices, slabs like these are a pain in the butt log.  Very heavy, move slow, single slab one-off sales, and very very hard to dry.

For me,oak move slower than walnut or maple.   
Woodmizer LT40HDD35, John Deere 2155, Kubota M5640SU, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

Offline newdesertfox

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Re: How do people calculate their lumber prices?
« Reply #17 on: January 10, 2018, 12:01:12 PM »
Thanks for the replies, I was basing that price for slabs off of a few places I saw including the guy's website for other slabs he has. But his market is wine and whiskey barrels/counter tops and apparently he was hoping to stock up on em. $2 a bf for red oak appears to be standard for large oak, even a huge sawmill near me thats what they charge for a fresh sawn beam. One of the reasons I was pricing it in that range was the log I have is a PITA due to its size and the backhoe being down but my original plan with it had been for QS dried and sold for $3-4 a bf as its a prime log. I personally am not a fan of slabs due to their size so its more hassle for me to cut but if he wanted a trailer full then I could use the fast cash. But as someone said even though the logs didn't cost me cash they have real value, and at least in agriculture its 50x easier to lower your price a $1 then raise is $0.01  so I don't want to start out low and then have to deal with price increases. Reason for knowing selling low was sold stuff and then saw every other sawmill in a 50 miles radius was selling same stuff for 20-30c more per BF (live and learn lol) and my wondering on high prices was some raised eyebrows when I've told people what the price was. One person was like you know I can buy PT pine beam for cheaper then that right? yeah... its pine not oak lol, a 16' oak beam is annoying to handle without a forklift. But yeah slabs are def not my target area, Im thinking lay out price, and have some investment from 2nd party before cutting a custom slab as I have zero need or want to store them. And heaven help someone if they try and get me to lower my price after I've cut haha


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