Is it common to sell KD lumber by gross tally?

[blackhawk]

There are 3 cabinet supply companies about an hour from me in Roanoke, VA.  They all sell their random width kiln dried lumber by gross tally.  This is how they do it:  if you call them up and say that you need 100 bf of cherry, they will give you a bf price of say $3. When they have it ready to pick up, they only have 88 bf of lumber sitting there for you.  They reduce your bf amount by 12% to allow for shrinkage.  So, even though they charge you $300, you only get 88 bf of lumber.  They are selling by the gross tally.  This is the way all 3 of these companies do it.  The first time this happened to me about 7 years ago, I was a little shocked.  When I order 100bf of lumber, I want 100bf of lumber.  I rarely get lumber from them since I have my own mill and kiln, but still need some for a project maybe once a year. 

Do any of you know any dealers in the rest of the country that do this?  I tell them every time that this is not how it should be done per the NHLA rulebook per page 56 of the 2023 edition:

The Model State Regulation adopted by the National Conference on
Weights and Measures on July 21, 1977 specifies that: "Sales of hardwood
lumber measured after kiln drying shall be quoted, invoiced, and delivered
on the basis of net board footage, with no addition of footage for kiln drying
shrinkage."

Every time they say "this is how it has always been done and every lumber wholesaler does this."  But I have bought from other dealers in NC and they sell by the net tally as it should be.  Just wondering if anyone has come across this in their area.

It is just super confusing and deceitful doing it this way.  I try to explain to them that if they need to add in the 12% (which is a crazy high shrinkage rate). Just build it into the price and sell the actual bf that someone orders.  It is all multiplication so it is the same, so if I order 100 bf, quote me $3.36 ($3x1.12) per bf and give me exactly 100 bf of lumber.  Simple.

[Jeff]

Sounds like theft to me. 

[WV Sawmiller]

   I don't KD or sell KD lumber but sounds shaky. I would contract with them to provide me with enough lumber to yield 100 bf of finished lumber and pay the agreed price for that.

[SawyerTed]

Gross tally isn't usually used in retail sales in my experience.  I've bought hardwood from a variety suppliers in NC and VA since 1982.  All has been net tally.  I always measured especially when I was teaching.  It was a good time to teach board foot calculations. 

Seems like using gross tally is confusing and doing a disservice to customers, especially small volume retail customers.  If a customer needs 100 board feet, selling 88 board feet is a disservice.   

Sounds like a way to pad the price by 12%.  Why not just up the price by 12% and sell net tally?  Particularly to retail customers. 

It's one of those things that might not be wrong by industry practice but sure doesn't make the business look good.

Wholesale sales is a different thing entirely.  

[Stephen1]

Intersting . So we sell 5/4 lumber but after the kiln it is really 1.1" give or take, not the 1.25 that came off the mill. So is the width measure the same? so is 6" is 5.75" after the kiln. 
I sell my lumber by the width it is after the kiln,6" is 5.75", but I calculate the 5/4" as 1.25" not the actual thickness of 1.1"

[GAB]

What ever state agency (maybe weight and measures) is responsible for enforcing the appropriate rules and regulations associated with the sale of wood needs to send some of their employees there to buy lumber.  Maybe they could fine them for unethical practices and get them to correct their policies concerning the matter.  Then go vist other sellers and collect more fines to cover their costs and time for the day.
GAB

[blackhawk]

Intersting . So we sell 5/4 lumber but after the kiln it is really 1.1" give or take, not the 1.25 that came off the mill. So is the width measure the same? so is 6" is 5.75" after the kiln.
I sell my lumber by the width it is after the kiln,6" is 5.75", but I calculate the 5/4" as 1.25" not the actual thickness of 1.1"

Stephen - By the NHLA rules, if your board is 1.1" thick after kiln drying, it should technically  be counted as only 4/4 lumber.  Per the NHLA, KD lumber between 3/8" and 1-3/4" thick may be 1/16" scant of nominal thickness.  So, to count as 5/4 lumber, your boards must measure at least 1-3/16" thick after the kiln.  Normally, hardwood lumber is sawn 1/8" oversize from nominal.  So, 5/4 lumber is rough sawn at 1-3/8" thick to allow for shrinkage.

Sounds like a way to pad the price by 12%.  Why not just up the price by 12% and sell net tally?  Particularly to retail customers.

It's one of those things that might not be wrong by industry practice but sure doesn't make the business look good.

Wholesale sales is a different thing entirely. 

Ted - I think exactly like you on the price.  Add 12% to the price per bf and then sell by net tally.  The order of multiplication doesn't matter.  Even if there is industry practice to sell by gross tally in some situations, I think it is still wrong because it goes against the NHLA and the National Conference on Weights and Standards. 

This gross tally deal is probably something carried over since the 1800s, but evidently some of these mills still sell KD lumber that way even though net tally was mandated in 1977.  Gross tally is easy on the big mills because I guess they count the bf right off the sawmill.  They probably sticker up a 1000 bf pack of green lumber then send it to the kiln.  Then they save time by not measuring the pack after kiln drying and just call it 1000 bf at gross tally.  But, it seems just as easy to me to sell that same kiln dried pack as 930 bf net tally, assuming 7% shrinkage.  7% seems to be the industry standard for thickness shrinkage for hardwoods.

[Larry]

When I went through the NHLA short course we had a couple of guys that were buyers for big retail/reseller companies. The net versus gross was a hot topic. I guess gross is most common between the sawmill/kiln dryer/producer and retailer/reseller. The kiln takes 7-8% and planing takes another 4-5%. Somebody eats it. The end seller normally sold net. The Chief Inspector spent a lot of time explaining the rule and deviations. Unfortunately I took the course 21 years ago and at my age my memory is about 5 minutes long so I can't recall the details.

Where oh where is member Inspector Woody, he would have the right answer.

I know when I sold wholesale green walnut walnut to a couple of kilns they always paid net. I've also bought KD lumber from Paxton or Schaller and paid net.

[beenthere]

Hardwood lumber is typically bought and sold on the NHLA hardwood lumber rules. Best to know and understand those rules to be in the hardwood lumber market. Similar when sawing hardwood logs into lumber that will be sold on the NHLA rules, but not knowing those rules.

Sawing and selling green by NHLA grade and then graded again after drying, a lot of scale can be lost if the sawing was not right. Has to do with width lost in drying shrinkage and dry boards are too narrow to make grade or scale.

Otherwise, maybe not good to sell by NHLA grades.

[YellowHammer]

Some of my suppliers do it, some don't, I'd say 50/50 around here.  I couldn't care less, as long as I know, and they tell me, up front when I vet them. I do the corrections myself based on their answer and me tallying the packs as delivered and billed to me.

There are reasons some places do it, as typically, the green mills who also kiln dry do their bookkeeping's based on the green wood tally off the mill.  They mill 1,000 bdft green, they barcode that pack as 1,000 bdft, they air dry it and then kiln dry it, then plane it and in many cases edge one side.  So as it moves through the process, they still have that pack on the books as 1,000 bdft. When I buy it, that pack is billed to me at 1,000 bdft even though the net is maybe 15% lower. 

So the first question I ask of a a wholesaler is whether they sell on gross or net. They don't hide it, all you have to do is ask up front, and correct for it. I don't particularly care one way or the other, as long as I know their process, because I compare and recalculate prices based on their answer and corresponding tally drop.  For me, it's no big deal, the first time I buy a load, I will do a tally calculation, compare it to the amount I received, and add that multiplier to the price comparison calculation for that supplier.  Then that adjusted or corrected number goes into my price calculation when I sell retail, which is only done on true measure within NHLA guidelines.  I spot check most loads that come in, and it simply falls under the Latin "Cavaet Emptor."

If I need 1,000 bdft and know a particular company has a 10% net drop, then I order 1100 bdft on gross and add 10% to their quoted price to get the real net tally and price, or use for price comparisons.  I don't consider it dishonest if they tell me upfront, when I ask, I just need to know. It's part of the vetting process with any of my supplier.

Me - "Do you sell lumber?" Them- "yes"
Me - "Do you sell on net or gross?" Them -"Gross"
Me  - "Ok, Send me a price sheet." 


On the other hand, there is one local retail business who sells by the individual KD board on gross tally to uneducated retail customers, and that is cheating.  We get a a lot of their customers, and I even wrote an app that when a customer types in the dimensions of a board, the calculated value is spoken out load from their phone for all to hear, just so both the customer about to be cheated, and the cheater can hear it.  It's hilarious, but it is intended to help the customer from getting cheated at other, perhaps shady, lumber places. 

[Nebraska]

Hmm never purchased from hardly anywhere but a box store. Local lumberyard had a little red oak back in the day but  it closed, good to know. 

[blackhawk]

Yellowhammer - The first time I bought from one of these places they didn't tell me that they sold by gross tally.  I too now know to ask, but I shouldn't have to.  To me, a supplier either follows the NHLA rules or they don't.  They shouldn't be able to pick and choose the rules they want to follow.  The NHLA rules are supposed to make everything equal within the industry.  If you pick and choose the rules that you want to follow, what stops one mill from counting FAS lumber as 5" and wider instead of 6".  Then another mill always rounds up on length.  Before long you have to make up your own spreadsheet with 22 columns to keep track of all the exceptions each supplier makes to the rules. 

I understand that the mills want to tally the lumber as green.  But, it seems simple enough that if they cut 1000 bf of green red oak.  Then just inventory that as 900 bf to allow for 10% shrinkage or whatever is appropriate for the species.  Then no one has to ask questions.  You order 500 bf, you get 500 bf.  What if certain gas stations started selling gas by the gross tally to account for evaporation.  The pump says that you got 10 gallons but you really only put 9.5 gallons in your tank.  That would descend into chaos quickly.

[Ron Wenrich]

I never dealt with KD wood, but I'm curious on how they tally the wood.  Do they just do a bundle by layer count?  I've sold green like that, but its just a pretty good estimate on volume.

Most of the green hardwood that I made went through a lumber grader, either at our mill or the buyer's.  If you're using a lumber grading stick, it will give you a bf volume for each piece.  Its not exact, but a lot of lumber gets sold that way.

When its KD, do they use a stick to measure and grade each board?  If so, the shrinkage would be in the tally.  Not every board would drop footage.

[TreefarmerNN]

What ever state agency (maybe weight and measures) is responsible for enforcing the appropriate rules and regulations associated with the sale of wood needs to send some of their employees there to buy lumber.  Maybe they could fine them for unethical practices and get them to correct their policies concerning the matter.  Then go vist other sellers and collect more fines to cover their costs and time for the day.
GAB

I believe in Virginia that might be the Department of Agriculture and Consumer Services.  At least that's where I would start.

[beenthere]

Yellowhammer explained it well.

Likely sorted by grade on the green chain coming from the hardwood sawmill and that "unit" stays as a unit until sold. Stickered to go through air drying and/or kiln drying, then un-stickered and sold as the gross original scale.

Liken it to buying a used car that you are going to fix up and resell and make some profit for your effort. Maybe the purchase is only for parts to resell and get a higher return on the investment.
The 1000 bd ft of hardwood lumber may be cut up for parts or clear cuttings to go further through a process of making flooring, or furniture, or paneling, or trim. Knowing a bit about what is in that bundle of lumber is important, like knowing what cut of meat one buys at the super market or the neighbors butcher shop. Unlike softwood dimension lumber that is a specific size and grade.

[Ron Wenrich]

We sold our lumber in trailer load lots.  Avg oak load was 8500 bf.  Usual grade was 2 Com & btr, and it was mixed.  That went to a panel plant, so it never got sorted out.

Some buyers would sort by grade at the mill.  Some of those bundles got to be pretty small, but they ended up going large buyers of a certain grade.  We didn't do too much business with them, as sorting was too much of a pain.

We sold casket lumber by using a layer count tally.  But, that wasn't broken down into smaller lots for resale.

I remember talking to a guy that had a small wood shop.  He bought some F1F & btr off of the local hdwd mill that had kilns.  Small shop, small load.  He said there wasn't a board that was 8' long or 6" wide.  He ended up with a load of Select lbr.  There isn't a Select market in our area.  It was a load of 1 Com.  Big price difference.  It pays to know what makes the grade you're buying.

But, I wonder about the guy who wants a partial bundle.  Maybe 300 bf, for example.  I could see someone doing a layer count and coming up with a total and put that 12% figure as shrinkage.  That would account for the net figure.  Simple to figure and not labor intensive.  As a buyer, I can see the advantage of knowing if its net or gross scale.

[YellowHammer]

Yellowhammer - To me, a supplier either follows the NHLA rules or they don't.  They shouldn't be able to pick and choose the rules they want to follow. 

Uh, sure they can, there is no law that says a mill must use NHLA standards.  Direct quote from NHLA.com:"The NHLA Facility Grade Certification Program raises the industry standard. The Program is a voluntary quality assurance program (QAP) for NHLA members who manufacture, sell, or purchase hardwood lumber. Companies that participate in the program are illustrating to customers and potential customers their willingness to openly submit to independent quality checks. Being "NHLA Certified" differentiates your business from the competition and assures customers that your lumber is "On Grade." Contact the NHLA Chief Inspector (901-377-1818) to learn how this program can enhance your reputation and give your company a competitive edge." 

This a real sore point with me, I consider NHLA no better than OPEC.  In my experience, the NHLA rulebook is used as much as a shield to rip customers off as not.  In the words of an old NHLA lumber grader and certified instructor "More money is made by a tape measure and NHLA grade book than ever with a sawmill."  In my experience, truer words were never spoken.  The seller ALWAYS wants to "push the grade" and the more trained the NHLA grader, the better they are at splitting hairs and justify bringing a No1 Common board up to FAS and making the mill more money.  If a mill says they sell "To grade" that is a big yellow caution sign to me.     

If I had a quarter for every time I heard the excuse of "Yeah, but it meets Grade" by certified NHLA lumber mills, I will gag.  When I hear that, I know they will ALWAYS push the grade to me, the buyer.  For example, typically a FAS and Select goes down to 83.3% usable, which is pretty much garbage as far as high grade furniture or lumber consumers are concerned, our customers.  So what do some (not all) certified NHLA lumber companies do?  They will "pick" the best boards out of a run and sell them at premium prices as "Presidential Grade" or "Show Grade" or some other non NHLA, non formal grade, and leave all the 83.3% or "meeting grade" usable boards in the stack knowing some poor schmuck just bought that pack or semi load of packs that just barely "meets grade".   If the customer complains they "didn't get enough of the good boards" then the seller will simply say "Well, we have a certified grader and that pack meets grade" and then make sure they leave more high grade boards in the pack for that customer next time, so they won't complain.

The worst are the ones who use technology and computers to meet grade.  I used one mill that used lasers and Star Trek tech to know the size, width and percentage grade of every single board in a pack.  That sounded cool until I realized they used the tech to make sure every board possible was pushed to "meet grade" to the decimal point.

That's why I personally don't really care how they tally, whether it be by counting layers, lasers, or tally sticks.  I will know how they do it, and will therefore know how to judge them.  However, as I said, that is part of the vetting process when I look a new suppliers.  I can get a pack of wood from two different mills, to the exact same NHLA grade, neither is breaking the rules, but one will be barely "at grade" and the other will be "above grade."

Want to know where the grade rules really rip people off?  I know of a company who LOVES to sell lumber through mail order.  They pick the lowest grade boards out of the pack and send them and save the higher grade boards from the stack for the walk in customers.  So they effectively "raise their grade" because all the scum boards have been removed so the walkins only see the better ones.  As the guy told me, "People will get the boards in the mail, they will get mad because it's not as good as they wanted, but hey, it meets grade....so they know they got a what they paid for, but not as good as they wanted, will swear us off, and then forget about it and order from his again.  Have you ever heard of someone returning boards in the mail?  Doesn't happen."  That's one reason we don't sell by mail, in the industry, it is generally regarded as a way to pawn off the lowest grade boards in a pack and would tarnish our reputation.   

I personally prefer to buy from independent, non NHLA mills, I like to talk to the owners, build a good relationship, and I simply say I want "HHA" (trademarked) grade which is zero knots, zero defects, all heartwood one face, no wane.  Some will do it, some will not, it's up to them.  Some will even let me pay on my calculated tally, not theirs, to keep us as a customer.  Or some will compromise and meet in the middle because we all know NHLA rules are used to rip people off, and if I feel they are being used against me, I will buy elsewhere, and what good is "just meeting grade" if the customer walks away? 

Is it worth a spreadsheet?  No, it's worth a lot more than that. If I buy a quarter million dollars of wood a year, literally from, mills all over the country, (Pennsylvania, Kentucky, Missouri, Oregon, Maine, even Canada, our 51st state) plus that much in logs, and whether they sell net tally, gross tally, follow NHLA rules or are independent, whether they are crooks or honest, and I misjudge or miss-buy by 10%, then whose fault is that?  Mine.  I have a pretty comprehensive database that I enter every pack of wood, including who I bought it from, the historical corrective coefficients for that particular mill and the actual price I paid all of the purpose of calculating a corrected yield from which I set my prices.   Why do I buy from so many different mills? Because they are the ones who consistently "beat grade" or do "NHLA FAS 90% and Better" or even "FAS 95% and Better" (Remember FAS ands Select only needs to be 83.3% defect free) and I get a better product.  Do you know what happens to all the lower percentage yield, the "84%" packs of lumber go that may not have a single clear board in in because it was cherry picked out but still meet grade?  I don't know, but it sure isn't coming to me.....   

The commercial lumber business is a mean world and sometimes the biggest cheats are the ones who hide behind the rules. Do you think that is bad?  It's nothing compared to buying exotics.

Did I say "Caveat Emptor" earlier?  Nope that is wrong.  A better saying would be "Don't drop the soap."


 

[Magicman]

Kinda the same with framing lumber grade.  A commercial bunk of SPIB#2 is allowed to have a certain % of lower (#3) and you can rest assured that it will have the maximum allowable amount of lower grade lumber.

I do not even scale and charge for #3 framing lumber.  It goes into the "free" pile and the customer can use it for whatever he chooses.  I had a homebuilder comment yesterday about the quality of my sawn lumber.

I realize that this topic is about buying/selling hardwood and I do not sell anything except a primarily framing lumber sawing service, but even then, quality & grade are important for staying in business.

[reedco]

I remember my Dad saying many times. Figures don't lie but liers can figure!

[Peter Drouin]

My dad told me the same thing.   I'm a licensed softwood grader in NH and what they will say is good #2 com can be ok. My lumber is always better than that. Just go into a big box store and look at the hard and softwood lumber. Amazing

[customsawyer]

I got in a semi load of #2 pine 1x8x16, on Thursday, for making paneling. There is over 14,000 bf on that load. I know from the start that I am going to take about 10% and have to cut it into something smaller or burn it. There will be another 10-15% that will have knots fall out, or will crack, going through the planer. I'm not going to bitch or complain to the mill I buy it from. I have just adjusted my prices accordingly to cover it. I can still buy it from them cheaper than I can produce it. This lets me pass the saving on to my customers.
The other thing to keep in mind. If I sawed it, dried it, and then bundled it, I would still have some bad boards show up in the bundles. So regardless of where I get the lumber from, I'm still going to have to sort it as I feed the planer. Some are still going to have defects show up after they pass through the planer. So it also gets sorted again after the planer.  You can just burn all of the bad boards, or you can make them into a different product and market them. Even with all of that there is still going to be a few bad boards sneak in to the pack of finished product. So I always put a few extra boards in every pack to offset that. The few extra boards are cheaper to me than the time it would take to aim for perfection. Mine isn't a slow process. We ran just shy of 10,000 bf through the planer yesterday. Making Nickle gap Ship Lap and V-Groove paneling. I can't expect my hired man to catch and sort that many boards with out a few missed flaws.
I understand where the OP is coming from with their question. I also understand that most mills that are using the NHLA rules, or the SPIB rules, are using them to their advantage and not mine. I think a lot of the lumber is now graded using optic scanners and the actual grader is just spot checking behind it. 

[blackhawk]

My thread was about net vs gross tally, so I'm not sure how we jumped the rails talking about grade, but to get back on topic....Whether your supplier is NHLA compliant or not, the national standard that I quoted in my original post says to sell KD lumber by net tally.  My home state of Virginia has in it's state code that they abide by this national standard.  So, at least in Virginia, a lumber supplier is required by state code to sell by net tally.  To me, it is just simple common sense that when you order 100 bf of lumber that you actually get 100 bf of lumber without asking a bunch of questions.  Even if there is a reason that a supplier does it otherwise, it is still a deceitful practice in my opinion.  If I know the reason that someone stole my truck, it still doesn't make it right.  I'll just have to live with it, I know, because I doubt my suppliers will ever change and nobody will make them, but I don't have to like it.  

[Ron Wenrich]

There was a time when Firsts were sold separately.  I'm thinking the yield on that was 91.7% with less cuts.  I think a bundle of FAS will have some boards that only yield 83.3% in clear cuttings.  But, not every board will have that low of yield.  If F1F is also included, the back only need be 1 Com which has a 66.7% of clear cuttings, and the cuttings are smaller in size than the FAS grade.

I've sawn a lot of hardwood grade.  The NHLA is the staple for the commercial side of the industry.  We rough graded, but buyers generally graded again to insure the grades were good.  When times are good, the lumber rules are relaxed.  That insures a steady supply of material to a planing mill or other commercial buyer.  When times are tough, they tighten up on the grade.  The same thing happens in the log markets.  If both sides understand the NHLA rules, then there are fewer problems. 

Most of the lumber sawn went to bigger yards that broke the load into different grades for different markets.  They KD it and then shipped.  The export market is often the destination for the upper grades.

I cut specialty markets, but that also came at a premium.  I did have markets for 10&wider F1F&btr tulip poplar.  I had a market for 1x6x12 clear red oak.  I had a market for 4"x6" quartersawn clear white oak, AD.  There was a market for casket lumber.  It had to have a clear 5"x7' clear cut on the best side.  Lumber was to be 7'  and 8'.  We put our 2 Com in there, as it fit their grade.  Clear front, knotty back.  I think most mills do that type of sort.  Broker yards do it.  There are premiums for single grade loads.  There is extra labor, and it should be charged.

Nothing says you have to buy or sell by NHLA grades.  Nothing says that you have to sell by HLMA prices.  I think if you're buying or selling in commercial markets, its good to have a working knowledge of the grading system.  I've worked with lumber graders and challenged them on their grades.  I've also stood on bundles of lumber and graded the boards.  I found it really helped me in the sawing end of the operation.

[YellowHammer]

Whether your supplier is NHLA compliant or not, the national standard that I quoted in my original post says to sell KD lumber by net tally.  My home state of Virginia has in it's state code

Is a state code a law or just a suggestion in Virginia?  Is it enforceable?  It sounds like it's not enforceable.

Do you really expect a sawmill to arbitrarily or even voluntarily cut their sellable net product by 10% per year, losing potentially hundreds of thousands of dollars, if not millions, simply because an unenforceable NHLA code suggests it?

[Peter Drouin]

Some mills charge for air. So if you want 100 bf order 110 bf or 115 bf and get what you want. Now you know that you can figure out the price.
Getting into it you might be surprised how many charge for air.