Hi been a while since on this forum. Glad to still its still running strong. I have been approached by someone about purchasing a timber quota off of him. Its small scale (so am I) approx. 120 cords a year, and 400 cords can be taken now as he hasn't cut in the last few years.. Mixed pine and spruce, easy access.Decent logs for area, nothing huge I would say average of 12-16 Inch butts . Stumpage fee of 25 a cord that would still have to be paid on the 400 cords( is this normal price or a bit high). I am by no means thinking I could make a living off this quota, but was thinking of taking it on as a hobby, I enjoy the woods, Can make it a family fun week throughout summer, have a sawmill (woodmizer LT 30) . Dont want to loose my shirt on the deal .Few keys points.
100 miles from my yard.
Sawmill is portable.
I have a 60 HP tractor.
Have a decent skid steer 60 HP
I have a good gooseneck trailer. 20000 lbs 30 feet long
Don't want to cut dimensional lumber( enough locals doing this). Thinking timbers, maybe even house logs, try and find a niche market . Not going to work for free and cut local sawyers throats. It can stay standing till there if there is no demand
Have worked with logs in yard but not really in the bush ( but am a fast learner)
Not alot of timber in my area.
I'm not scared of hard work, like working long days.
Wants $20000 for quote. says there is no expiry.
Please give me any advice, as to if this is a good deal, or am I out of my mind????? :D :D :D :D :D :D :D
Thanks guys.
Sorry for the long reply - kinda thinking out loud here
Let me see if I understand this, you would pay the quota holder $20K and the landowner $25\cord?
In my area only firewood is sold by the cord (128 cubic feet). All other wood is sold by the board foot or by the ton. If you're going to saw dimension stock, you're not gonna sell it by the cord but by the board foot. How are you going to convert cords to board feet?
Lets looks at some simple math, a straight conversion would mean 1 cord = 1536 board feet. 1536*120 = 184 mbf per year.
$25 \ 1536 board feet = $16.26 per mbf to the landowner.
Lets say a 5 year payback to the quota holder. $20K\5 years = $4k per year for 120 cord per year. 4000\120 = $33.33 per cord, $33.33\1536 = $21.70 per mbf to the quota holder.
Your wood cost not including logging is $21.70 + $16.26 = $37.96 per mbf, add your overhead to that to get a true cost.
Folks around here will saw softwood for you @ $0.35 per board foot or $350 per mbf.
Your total product cost not including actually getting it out of the woods is $387.96 per mbf or $0.39 per board foot.
What does sawn wood go for in your area? Around here its in the $0.80 - $0.90 per board foot. Lets call it $0.85 or $850 per mbf.
If your cost is $390 and you can sell it for $850 you have a profit of $460 per thousand.
So if you cut 120 cord or 184mbf per year and selling all of it at $0.85 per board foot.
You pay the landowner $16.26*184 = $2991.84
You pay the quota holder $21.70*184 = $3992.80
Your sawing costs are $350*184 = $64,400.00
And your profit $460*184 = $84,640.00 (lots of overhead here)
Lots of variables here that I haven't accounted for and this is just one scenario.
Now can you cut, skid & saw 184mbf in a year? Doubtful with what you've told us.
What's your production rate logging? How many hours per thousand to get the wood out
How many feet can you saw per day on your LT30?
Lets assume you can cut & skid 1500 feet one day and saw 1500 the next day.
Thats 123 days logging & 123 days sawing - 50 - 5 day weeks sounds like a full time job to me, and can you sell that much lumber?
Find a market for the lumber and I think you can make $$ with that deal, saw what you have time for & sell the rest on the stump or as logs...
Someone check my math - low on caffeine this morning..
Jason
I dunno if its a good deal for the OP, but Jason, youre hired.
Quote from: northernss454 on February 26, 2018, 07:53:38 AM100 miles from my yard.
:o
Quote from: northernss454 on February 26, 2018, 07:53:38 AMI have a good gooseneck trailer. 20000 lbs 30 feet long
:o :o
I see issues.
With distance and equipment, it wouldn't be worth it to me if it were free. Bet it would be cheaper and less work to buy logs.
You have a CDL-A?
Cant do it otherwise.
Thanks guys. yes Mike I do have the correct license so thats not a issue. I doubled checked and yes that's how they sell the stumpage 25$ per cord taken from bush what you do afterwards with it they don't care. Firewood goes for $115 a cord in lengths. $200 cut and split. I don't have to take the full 100 cords a year if i don't want. Also asking around it seems people are getting around 500 bd /ft per cord. We get around $5-$5.50 mbf for rough lumber here in my area.(wow never realized how low that is).
500 bd/ft per cord x .50=$250 Think i'm better off to sell as firewood!! Or turn and run!!!
Also sawlogs delivered to yard would be $200 a cord. This is all for spruce. So yes thinking about it not alot of $$ in sawing.
Something seems off on the rough sawn price. How can rough lumber cost less than rough logs
Mike sawn lumber is $50 more than raw lumber. Seems outragous. I can get a semi of saw logs for $3000. 15 cords x $200. Thinking that might be the way to go.
called another sawyer and a 2"x6"x16' is $9 so unless my math is wrong that works out to $560 mbf. So he is a bit more that $500 mbf But not a lot ::) ::)
I think youre gonna spend a lot of time away from home and a lot of money on fuel. Forget one thing at either end and its a crazy roundtrip. Your chance of an accident loaded with logs or lumber is way up. Do you have a commercial policy with logging and lumber in the policy?
Say you pay this 20 grand and the guy croaks. How many thousand more in court to enforce your claim when his daughter wants to sell it to a golf course developer?
If you go the firewood route, how and where will you process it? Where will you store it and where will you deliver it to? Is this woodlot any closer to a city where you could maybe sell it all to a firewood distibutor?
My initial thoughts are that itll only take one major booboo to throw this all off for you. Truck loses a convertor or tractor burns. Fall asleep at the wheel get hurt in the woods. The distance is very expensive and youll spend hours commuting instead of producing. It might be a good setup for someone right up the road from the woodlot but its gonna wear you out in time, tires and diesel.
If you insist on doing it i think you ought to counter offer to cushion your added expenses. If it was such a deal why hasnt a local jumped on it. Youre probably not the first guy to hear his pitch.
Ok Mike I hear you. Thinking of steering clear of this. The Quota is a government quota so there should never be any land disputed later on. So I never will own the land only the cutting rights. So if a fire starts i'm EDITED BY ADMIN out of luck. yes the travel is a killer, especially with the price of fuel never going down. But please everyone keeps the comments coming. What if i buy and throw a add out there for a commerical logger to go clean house and pay me a stumpage fees onto of stumpage fee. I know does leave alot left on the table.
An additional thought. Your mill and equipment is portable....
Know anyone with some land near the plot of timber? Maybe you could set up a base of operations and sell from there. The timber owner may be open to this as well. At a minimum, you can move more lumber/cants/beams than logs since you leave the waste behind. Add a little camper and you'd be set.
Still, that's a lot of $ for a hobby without a defined market. I assume the $20k is up front. Of course, my pockets aren't very deep. :-\
I'm a small timer one man part time operation. What I do if I'm looking for timber is to get on google maps and our local plat maps. Look for treed sites in the 0.5-10 acre range within 5-10 miles. Further if you need to.
They are too small for most logging outfits to be interested in, but fine for a ton truck and tractor logging. They are generally happy to get anything for the timber. Don't leave ruts and clean up afterward and you will likely have as much wood as you want.
May be a few that are interested, but turn out to be duds when you walk it. But the time invested to get some good ones would likely be way less than 3-4 round trips to this other place and a lot less $.
I guess a advantage to the area is its the only site within 100 miles that have soft wood trees. this was a plantation planted in the dirty 30's. as a government program to help in troublesome time. That's why it would be nice logging all trees are in a straight row. But as a matter of fact I do have a buddy that's close. What about cutting timber in bush and just bring home sawed lumber. ::) ::) ::)
don't have any info but i want to sell wood where you live 115$ a cord fore pole wood :o :o and 200$ for cut and split that's an 85$ prophet ill stay with the pole wood :)
Saw an ad yesterday for split Oak at $130 per cord (not rick or face cord). 3 cord minimum on a gooseneck trailer, but would deliver at that price up to 2 hours away. :o
That distance includes 4 of the 5 biggest cities in MO + #7!
Well living in the Canadians Prairies wood is more expensive i guess.. :-[ :-[
i did not mean to embarrass you i get it if you live far away from things it costs more believe me if i could i would be in the outback in Alaska where it would be a 2day trip with a plane
No not embarrassed at all. Just weird that you can almost buy cut lumber cheaper than firewood!! strange. But as they say it is what it is.
Thanks you all for your comments. I have decided to walk away from this purchase and just buy logs outright delivered to my yard. Thanks again, I'm sure ill have more questions once I get cutting. I will post some pictures when I get all setup. Thanks
Your buddy close by doesnt have any interest in it, does he? Maybe one guy does firewood side and other does sawlogs?
Just buying what you need doesnt sound bad either. $20k is a lot of working capital to tie up.
The distance alone would be a show stopper for me. Each trip you go is basically 4 hours drive time which means a tank of fuel. There would be know going out and working a few hours at a time to try and maintain some kind of family life. Kids ballgames, get togethers etc.