Log buying 101

[Bibbyman]

I need help.  Over the past couple of years Forum Members have asked for my advice on how buy logs - where to buy them, how much to pay and "how does this all work" in general.

We've struggled with the same issues and to some extent still do.  I know one thing; log buying is not like any other commodity.  You can't go down to the log store and pick out two of these, a dozen of those, etc. and if you don't like the price or color, go across the street to look for a better deal.

Often times the person requesting my counsel lives in some other area of the country where the whole situation is different then my local area.  Maybe they're buying logs I'm not even familiar with.

As we only buy maybe 100 logs a month average,  we have only a keyhole size view of the whole prospective of the subject. Thus,  I'm reluctant to give advice on buying logs.

What would be really great is... some of y-all that do a lot of log buying get on here and open the topic up.

Here is a collection of their questions ...

Where/how do you find logs/logger?

What are the details of the transaction?  i.e. Do you just pay the logger what he wants?  Do you scale the logs and pay the logger what you think they're worth?  Do you pay in cash?  Do you make out two checks – one for logger – the other for land owner?  Do you buy on Doyle, Int, by the ton?

How can a person find out what the current fair market value of the logs you are about to buy?

So, please, you guys that buy logs on a regular basis and have experience, open up a little and tell us how it's done.

[beenthere]

Well Kirk, fill Bibbyman in on how it's done  ;D

[Ron Wenrich]

I don't buy logs right now, but I have helped mills to start up.  One particular mill was from dead cold.  Both the owner and I were new to the area and I had to develop some sort of log buying prospectus.

If you want to buy logs, you have to have some sort of feel on how you're going to do it.  If you're just going to go out and offer $XX/Mbf for red oak, you're only going to get stuff that others aren't paying that price for...in otherwords junk.

What I always have done is to establish different grades of logs.  You can use the USFS grades.  I also had to add a premium grade for logs that were better than the USFS grades.  Its pretty standard and you can find some yield data on these grades for many species.  From yield data you can develop a price structure for your grades.  If you don't want to do yield data, then its just a crap shoot.  Throw darts at a board and come up with prices.  

To find loggers, I talked to other mills first.  They would either offer me logs at their price and grade or they would send me loggers if they were full.  I also talked to the state forestry office.  I went on timber tours, where you meet other loggers.  Veneer buyers are a real good source for either logs or contacs.  I would keep on networking until I found the right mix.

Most guys will look at your price list.  If they're in the area, they will drop a load or two off on you, just to see how you grade and how you scale.  If you get real hard with the scale, you won't see them again.  If your grade is too tough, they won't be back.  Treat them like the asset they are to your operation.

After you start buying logs, you will have to update your yield studies.  Every so often, you have to see what's inside a log.  That will tell you whether your price has to go up or down.  

If you're buying specialty logs, then expect to pay a premium.  Loggers will seperate logs if the premium is enough.  If you can average $1/bf log run for a grade of log, don't expect to pay $.50/bf.  

If you don't want to take the time to scale and grade logs, then you are at the tender mercies of the marketplace.  

[Kevin_H.]

We only buy red oak, white oak, hickory or ash. and we only pay one price.

For instance we want tie logs or better, but the top that we pay is 350.00 per thousand, at this price most of the logs we get may only have a few defects, We get a lot of good looking logs that the grade buyer has kicked out for some reason. these kick outs as I call them, are typically clear but may be split or have some rot on the butt.

One of the things that I hated to do was grade logs and have to figure the prices on the different grades, by going this route I have pretty much gotten rid of that head ache.

The other thing that helps is being able to go to the landing and pick the logs up. when doing this ya sometimes get to pick out the better logs.

[Brad_S.]

I buy even fewer logs than Warden Mill, so I'm just happy to get any logs at all sometimes. I have found 3 guys I trust and I feel are square shooters. When I need something, I ask to find out who is in a woods that has what I need. I ask them to tell me what they need to get in order for me to get the logs instead of them going to their main buyers. That's where the trust part comes in. They usually tell me what they are getting at the large mills, all of which are a good haul away, so selling to me saves them some trucking costs. I pay that price with one check to the logger. I usually pay more than the big boys for some logs, specifically tulip poplar and white oak, to be sure I get good quality. Both species give me a high margin of return, so I can afford to be a little generous to get them. They usually drop them off, I scale them on the Doyle (standard scale used around here) and send them a check. The fastest way to burn a deal like this is to short scale the logs or try and beat down the price of the logs. If it's a win win all around, the honor system works.

[Bibbyman]

Looks to me like there is at least some log dealing between sawmills. 

I talked to one logger that also ran his own sawmill to saw his better grade logs.  His yard was full of rough, mostly oak, logs.  I asked him why he had such an inventory and he explained that he saved up his rough logs until the dead of winter when there was little logging being done.  It was then that the other mills would run low on logs and start calling around. Then he'd have no problem moving his low end logs.

What would be the reaction of a sawmill owner if "Weekend Sawyer" dropped by and asked to buy a dozen 16' oak logs?   Would they deal with him or tell him to get lost?

[twoodward15]

Maybe Scott B. will chime in here.  I'm curious about the urban "treecycling" side of this as well.  What are those logs worth.  Is anyone paying for them?  I guess I'm looking at it a bit differently.  I know that noone wants yard trees, but once they are on the truck nobody knows where they came from.  It's the city goose syndrome.  My wife won't eat a "city goose" when that goose flies into the country and someone kills and eats him they didn't know he was a city goose!!

[Brad_S.]

Looks to me like there is at least some log dealing between sawmills. 

I have purchased WO from another mill through one of my logger contacts. That mill specializes in certain species, but buys all species from the local loggers to keep the flood gates open. They then turn around and sell the species they don't cut. My logger hauls a load from his landing to them, then back hauls a load from them to me. I pay the logger the going price, I don't know what kind of deal he has worked with the other mill and I don't care, as long as the mill is happy, the logger is happy and I always have been as well.

twoodward15,
there was thread a while back about urban logs and their worth. If I recall, some won't pay a cent but will pick them up for free, others do indeed pay for them. I myself will take softwoods away but not pay, but I will pay in the area $100-250M for nice logs in order to keep the tree guys calling me. Now that firewood has gone up, those prices aren't as attractive to many of them anymore. I get mostly suburban logs which aren't as big a risk as city logs metal wise. I did pay one homeowner $500M for some walnut, but this is part of what I got for the money.

[pigman]

I know that no one wants yard trees, but once they are on the truck nobody knows where they came from. 

I know that in any business a person can only fool a good buyer only once. Back about twenty years ago I had some trees cut on shares by a logger that had a good reputation. He could make a call to any log buyer in the area and they would come and make an offer for the logs. Another logger logged the farm behind mine and he complained about not being able to get any buyers to even look at the logs.  The second logger would cut trees in fence rows, swap logs after they had been scaled and other not so ideal things.
I have found out that trying to fool a repeat buyer will only get you fooled.

[Ron Wenrich]

We sell logs to all other types of operations.  We're more loggers with a sawmill instead of a sawmill with a logging crew.  Big difference.

We sell logs to scragg mills, pulp mills, firewood cutters, homeowners, shaving operations, veneer buyers, and other sawmills.  The small stuff is a no brainer.  Get rid of it wherever you can and close to a jobsite.  What you can't, we bring back in for our firewood piles.

Veneer buyers are also a no brainer.  You can't cut up veneer logs and make a profit unless you have some sort of niche market that is paying really well.  Veneer buyers also buy export quality sawlogs.

We sell some of our poplar to a large mill that will pay more than what we can get for it sawn.  So, they get some at times.

We have 2 guys with Woodmizers that have bought logs.  One guy wants hemlock.  We hae a limited market for hemlock, so, either he picks it up or we deliver.  The other guy used to drag his mill to our site.  These were usually nice rejects with metal.  He would saw about 1 log/hr and left such a mess that he wasn't invited back. 

Bottom line is that a mill will sell you logs if you are paying more than what they can get for them in sawn lumber or if you are looking for something that they can't use. 

[dewwood]

I buy from loggers (one primarily) and arborists and landowners selling standing timber.  I also buy from other mills similar to what was mentioned earlier, they specialize in certain species and will sell the others basically at what they have in them.  I just offered $1650 for three yard trees one large walnut and two smaller ones and a pallet mill offered almost twice that.  I thought I was putting a lot on them but I guess I just did not know what I was looking at or maybe someone else didn't.  I was spending my money and the mill buyer was spending the mills money.

Around here there are so many Amish sawmills that even the tree services want you to pay $250 or better just for junk pallet logs.  I have better luck just working with a logger and letting him know what I will be needing and he can usually find them.  He is bringing in a large butternut that was starting to go bad in the woods.   I have been trying to get some more of that for a long time.

I guess what I am trying to say is there are a lot of ways to end up with logs we just have to figure out what works for us and proceed along those lines.

[Tim]

I buy white cedar here. I have written my own spec list for the sawlogs. There are three grades to them based on length, diameter, sweep and rot. I pay according to the grade. When the load is delivered, I mark for grade. When my scaler comes in, he'll mark on his scale sheet by the grade, and I pay accordingly. What doesn't make for a sawlog will go into the fourth grade for shinglewood.

I find the third party scaler (if he is a good one) helps to resolve volume disputes before they happen. Additionally, the scale rule (ie Ontario log rule, Roy rule, Doyle, International, Scribner) will tell you what is in the log. I have bought on the metric scale by weight... that was a terrible mistake. The conversion factors for Ontario metric are right out to lunch.

I have had people ask me, "How much is that tree worth? "How much is the bush worth? They look at me a little funney when I tell them to cut it down and scale it...

As for making contact with log suppliers... Try sawlog bulletin. Those folks offer a decent service. Run an add in the paper for what you are looking for. Don't buy  marginal logs if that is not what you want. You can make bad lumber out of good logs but, not vice versa. Treat the suppplier fair, and the logs will come to you.

Conversely...

I know that no one wants yard trees, but once they are on the truck nobody knows where they came from

... This type of thing has led me to not buy off certain people. That's just about as bad as piling your junk into the middle of a pack of lumber.

[FiremanEd]

We buy mostly Tie grade logs. I don't have the markets for the high grade lumber. The bigger mills 100 miles west of us are paying .40/bdft (in the log) more than I can sell FAS lumber for. I tell the loggers to seperate and send the high grade logs to the grade mills and the Tie logs to us. We buy on the International scale for everyone except one guy who we buy on weight. We routinely buy from 6 different loggers plus our crew. It is very much feast and famine. Three weeks ago I was within an hour of running out of logs when the flood gates opened. In the past three weeks we've taken in somewhere around 40 loads. I lost count. We now have about 20 loads on the yard.

I prefer to send one check to the logger and let him divide it up but two of the loggers are cutting for a pulp company who requires that I write a check to them for their share. The logger get's X dollars / mbf to cut and deliver the logs to me. Usually between $95 & $115 depending on distance of the haul.

We're paying $300/mbf for Oak tie's, (12" and up), $220/mbf for mixed hardwood ties & $150/mbf for pallet logs (any hardwood 11" and down)

Finding loggers can be tough. We're in our home area where we know most all of the loggers so that is a good advantage but not the whole answer. Loggers are reluctant to change and it can take time and good word of mouth to get you logs. Once you get a couple loggers to bring you some logs and they're happy, they'll talk to their buddies and word will spread. Then you'll be overrun with logs.... which is a better problem than running out of logs, though stressful as my girlfriend will attest after we've taken in 40 loads in the past 3 weeks.

Most big mills have price sheets that they hand out without question. Stop by the office and ask for a sheet. At least then you'll know what they're paying.

[SwampDonkey]

I know what you mean about loggers not wanting to change. It took years here to convert some to buck the sawlogs out of the pulp pile. There are still some that won't, they'll haul the load into the marketing board for them to buck for grade at a price. It's cheaper for them (loggers), rather than hire a guy full time on the yard to buck. At least, that's their answer. I think it's a high turnover rate for these local loggers and they get tired of having to retrain guys, so they let the marketing board do the bucking.

[Tim]

I know what you mean about the reluctance to consider change SwampDonkey. It is fairly well the same deal with the mills. That high volume / low yeild is, in my mind, a large problem in the way the forest industry as a whole works in this county.

I understand that only a certain portion of a business should be dedicated to a nieche (sp? Where is the spell checked Jeff?) however, that portion dedicated to a neiche could carry well over half of the monthly gross of that business.

A little value added can't hurt, be it logs, lumber or other wood product.

[Brad_S.]

Sorry to go off topic, but here is your spell check answer Tim.
https://forestryforum.com/board/index.php?topic=11912.0
I'd be lost without it! smiley_dunce

[Kirk_Allen]

Well Kirk, fill Bibbyman in on how it's done  ;D

:D :D :D :D :D :D :D :D :D :D :D :D

Beenthere I am dying from laughing so hard.   :D :D :D

Bibby, I will share how to get logs if you can tell me how to manage my log lot :D :D