You've got to pay to play.

[wkf94025]

Great thread!

[stavebuyer]

I think it is prudent to point out that if you are going to skip the "wholesale" lumber markets in order to sell directly to end users in addition to a mill, loader, and log pile you also most likely need to kiln dry, plane, and possibly machine.

Thin kerf band mills have a high per unit cost of production and one real advantage lies in yield. As a business owner it is prudent to own the additional yield and the higher the value of the product being sawn the greater the potential to profit.

An extra 15% yield in pallet deck boards doesn't amount to much but an extra 15% yield in FAS White Oak or Walnut adds up in a hurry.

[customsawyer]

Stavebuyer you are 100% correct. The kiln and planers are game changers. They have a great impact on keeping you from having to sell to the wholesale market. Another old saying to keep in the back of your mind when you are figuring out your pricing is "pigs get fatter and hogs get slaughtered."

[Crossroads]

Picked up a trailer load of red cedar yesterday at almost half the price I was quoted a couple weeks ago. Was able to get 1190' (scribner) on the trailer, mostly 18's and all nice and solid. I have 600 bd/ft of 6' fence boards sold and I'm hopeful to get at least 30% overrun on the scale. 

[KenMac]

Not meaning to be nosey but I'm interested in knowing why the drastic price drop?

[customsawyer]

Lumber prices are dropping. I buy some 2x and 1x pine in on a regular basis, as I can't saw and dry it as fast as I can sell it. The 1x is holding steady. The 2x is dropping fairly regular.

[KenMac]

Thanks, Jake, but it still seems odd to me that ERC logs would have dropped that much without some weird circumstance. My luck if I found some decent ERC logs they would double while awaiting delivery. >:(

[moodnacreek]

I love to look at real sawlogs. Having sawn lots of junk logs for years has taught me hate them. With the mill I have now I could eat that pile up pretty quick.

[Walnut Beast]

Look at the junk logs some of these guys are selling into slabs and different odd ball stuff most would throw out!💰. Being used for Epoxy tables and the minimum is 6-10k with a waiting list. 2k to 3k for a 24"x 48" coffee table sold out the list goes on. Just like house building the money is in the finish work not the framing. Just like someone said here. (Custom) I would rather saw up some high grade hardwood in a few hours than a whole day on framing lumber 💰

[SwampDonkey]

I've seen 36", but end, white cedar cast aside because of a little pencil rot. There's a lot of outer wood in a log that big. Yet they don't want to pay much for the very best of it either. I think the highest I've seen was $160 a cord. That's not much better than firewood. And as far as boards go, you want clear boards with white cedar because those knots will fall out a lot easier than pine. Had white cedar as vertical wall boards, we had to fill a lot of knot holes, for cedar that was suppose to be mostly clear. :

[customsawyer]

KenMac since he is based in Idaho I'm thinking he is talking about western cedar. Not eastern red cedar.
I know my 2x pine has dropped a little over 20 percent in the last 3 weeks.

[TWG]

I like the junk logs most of what I mill is live edge junk. Mostly spalted maple and beech.
A lot of coffee tables and shelving. 

[KenMac]

Thanks again Jake. I'm slow but I gotcha this time.

[Crossroads]

Jake is correct, I have western red here. I'm not sure it was as much of a price drop as it was one logger simply trying to make some extra money and the other actually giving me the same price the big mills pay. 

[YellowHammer]

Here is a good example of what happened this week.  I sell eastern red cedar, and most of the local logs here are pretty small, and chipped up to make wall board.  Also, since cedar chip board is selling for sky high prices, the company that makes it is paying premium prices for ERC cedar log only to  dump them in the chipper, process out the oil, and glue into paneling.  So I need some decent sized logs because I'm running low on 8/4 boards and it's about time to mill some.  

Problem is, most loggers have switched to selling their logs to the chippers, as they are getting paid by the ton down to a 3" top, and are not selling logs anymore.  So I called couple local loggers and they say the logs are $2 per bdft, about double what I paid last time.  Ouch.  Well, I need them, so I told both that I need a "few thousand bdft" and need them as soon as possible.  However, I got the feeling that it would be awhile.  

So then I called up a local mega sawmill, and asked for them to put in an order for them to saw me up some 8/4 ERC, and they said it would take "months" to fill the order, because they can't get the logs.  Well, that isn't good.

Then I called up one of my wholesaler buddies who "knows everybody" and he found me two options, one maybe a hundred miles away, that would mill me some, and including shipping, would be way too expensive for me to dry, plane and sell without raising my prices way up.  He found another mill who might saw me a "few thousand bdft" but they also couldn't get logs, so who knew how long it would take to fill the order, probably a month or so.

Then I called a western cedar shop in Nashville, (they ship it in) and they quoted air dried WRC at over $4.50 per bdft so that's a no go.  It's just cedar, I'm not buying that and being forced to resell at stupid high prices.

So what is my solution?  A sawmill is no good without logs....  I told the loggers that I need logs and to fill the orders when they can, I told my buddy to turn one of his mill on to place the order, and I placed my order with my local mill.  Hopefully one or several will fill my orders, possibly non will, but no matter how many do, I have to pay them, because I said I would.  So if all deliver, I will be in it for several tens of thousand$ but I need the logs, lumber or both.  Either way, I'll probably run out of 8/4 ERC lumber before I can get any of these solutions to pan out, so none are optimal, and after all, it's "just cedar" and I can't charge walnut price for it, so I can't get in to it for too much, or I will be left holding the bag if the prices drop in the future.  However, I can't sell it if I don't have it.  

I have to pay$ to play$.  

[Crossroads]

The load of Doug fir I have on site has me in that boat. I bought it this spring and now lumber prices have come down to the point that it's not selling. Fortunately I need it for my mill shed and will start milling for that soon. 

[YellowHammer]

That is a key thing, when paying current market prices, it's important to move the product while the prices are still current.

It's a balance between not having any product so sell or having too much expensive product to cycle through before the prices drop, if they drop.  Some prices are dropping, and some prices are still going up.  

[customsawyer]

YH if your luck is like mine than all of those sources will get the cedar for you at the same time.

[YellowHammer]

Yep, probably.  I'll get them all in at once, and have to pay them all.  Or I won't get any.  Feast or famine.  

[wkf94025]

@YellowHammer  what dimension cedar is most popular with your customers, and what is a typical application for them?  I have several large western cedar logs, and it seems just driving around nicer neighborhoods that clear vertical siding in a 1x4 or 1x6 seems popular.  Curious about your market.

[WDH]

For me, customers want the ERC for raised garden beds and blanket chests.  Not a steady seller for me.  Seems to run in boom/bust cycles.  

[YellowHammer]

Generally 4/4 and 8/4 by as wide as possible as premium furniture grade brings the most return.   Folks who buy this are the ones who just bought a new Green Egg and want to build a table for it, or Adirondack chairs, or even paneling for their bathroom or Jacuzzi.  Or the 3' x 8' porch table they want to last a lifetime.    

I will grade sort it and sell the lower grade as paneling and such, but the real profit is in the high grade wood, selling for $6 to $8 per bdft, for the furniture builders and woodworkers.

Almost all ERC is sold as No.1 common, and the fact that I sort and sell the equivalent of FAS makes us unique, so lets us set the market, as long as I can get the logs.      

[Bruno of NH]

2 weeks ago almost out of logs 
Now more than I want are hitting the yard , I take them or I won't be offered to buy from them again.
Lots of orders in the yard done , not paid for or pick-up. 
But you still need to pay for logs.

[wkf94025]

Generally 4/4 and 8/4 by as wide as possible as premium furniture grade brings the most return.   Folks who buy this are the ones who just bought a new Green Egg and want to build a table for it, or Adirondack chairs, or even paneling for their bathroom or Jacuzzi.  Or the 3' x 8' porch table they want to last a lifetime.    

I will grade sort it and sell the lower grade as paneling and such, but the real profit is in the high grade wood, selling for $6 to $8 per bdft, for the furniture builders and woodworkers.

Almost all ERC is sold as No.1 common, and the fact that I sort and sell the equivalent of FAS makes us unique, so lets us set the market, as long as I can get the logs.      

Helpful, thanks.  No telling what grade I'll find inside these logs of mine.  Does rift vs quarter vs flat sawn matter to your FAS buyers?  I have 4 logs totaling about 5,000bf gross, and 3 look like they'll yield some clean clear stuff.  The 4th is a bit more knotted/branched, and not quite so straight.  Thinking 2x material as the main yield, and closet lining 4/4 from the smaller stuff yielded for knots and curves.  Total cost before my haul costs about $1500, or about 35 cents per gross board foot.  An urban salvage situation that my little league assistant coach turned me on to.  It also included 15,000bf gross of A-/B+ redwood logs.  Metal detector at the ready, given source.  A small opp typical of the "understory" market here that big players never hear about or wouldn't bother with.

[WDH]

Your Western Red Cedar is not used for the same purpose as Yellowhammer's and my Eastern Red Cedar.  WRC is more of a construction material for house siding and for posts and beams for timber frames, outdoor pergolas and structures as the WRC has good weather resistance properties.  WRC and ERC are not the least bit similar and are not generally used for the same purposes.