Shares or Upfront? - I'm torn

[Abeman]

Based on a few initial walk-throughs with a forester, I'm being told that I have roughly 20k to 40k of board footage to work with. I'm torn between the two options: shares or lump sum!?!

Putting my timber out to bid via a forester consulting service seems like a very reasonable approach. It secures the money upfront, takes care of the permit process, and gets a competitive interest in my timber...which should drive up the lump sum proposal. On the downside, 20K to 40K bdft is probably on the low end for this type of sale and I may not get that much interest. I also assume most proposals will assume a lower qty of board footage to protect their own interest, which I can't blame them...but which translates to less in my pocket.

On the other hand, it seems to me that I can get more out of my board footage if I go the shares route. In my thinking, if there is truly 40K, I get a share of every ft as long as I'm dealing with a mill and logger that is honest. I'm seriously considering hiring a forester consultant to help me inventory my timber, get the permit and then working directly with a logger on shares. I know I have white & red oaks, and black walnut in there...I want me and the logger to make them most on them as possible.

I don't need the money upfront and I don't want there to be timber theft...which option is better...or is there something I'm missing?

[dgdrls]

I have limited experience with timber sales however, my past experiences have always
been 50/50 & 60 owner/40 logger veneer log splits for logs sold on the landing, each of you have skin in the game.
I was told by a Utility Forester and a mentor of mine you're not really sure what you have until its down and even then you can get surprises.

What ever route you choose be on site when logs are being scaled and loaded, then you will not worry about the tally numbers, as an additional check you can compare cruise tally volumes to sale volumes they should be reasonable to each other,  The better the Cruise the better your numbers should be. 

Question,  what permit are you needing?

Good luck,

D

[gspren]

  I like the idea of an independent forester putting it out for bids, he/she will know much better how many ft before it goes out because they will go through and mark every tree that's to be cut. A good forester will also know who in your area bids on that size tracts.

[treeslayer2003]

99% of my land owners choose the 50/50 share. for good reason.......you will almost always come out better provided you choose a fair honest logger. remember the consultant will have to be paid, 10% or more. i would do some talking, try and get a well recommended logger.your local county agents are a good start, they have no bias. 40k feet is a small job, even for a small out fit, however if the oak and walnut is good it can be well worth it. i never discount small jobs. like was stated though, you never really know until its cut what the quality will be. btw, news of good honest dealing travels fast, news of a crook travels faster. do some talking, you'll find a good one. i always take care of any permits, i assume most of us do.

[luvmexfood]

20 to 40k bf is a big variance if you look at the fact it is a hundred percent difference in what you may have. Or is my math wrong? What is wrong with using the forester you already have used for the walk-thru's? And like  dgdrls said. You never know what you have till it's cut. A tree can look good standing and when on the ground it's crap.

[Maine logger88]

99% of my land owners choose the 50/50 share. for good reason.......you will almost always come out better provided you choose a fair honest logger. remember the consultant will have to be paid, 10% or more. i would do some talking, try and get a well recommended logger.your local county agents are a good start, they have no bias. 40k feet is a small job, even for a small out fit, however if the oak and walnut is good it can be well worth it. i never discount small jobs. like was stated though, you never really know until its cut what the quality will be. btw, news of good honest dealing travels fast, news of a crook travels faster. do some talking, you'll find a good one. i always take care of any permits, i assume most of us do.

Same here I have only bought 1 job in 10 years upfront all the rest have been on shares usually 50/50 on logs except hemlock a certain amount per ton on pulp depending on species and firewood is bought by the cord. All the landowners I have worked with have been happy with this arrangement so far.

[Southside]

You will financially do better by going the shares route.  Also, if some issue develops during the harvest it is a lot less messy to stop work if you have not already cashed the check for what is remaining.  One thing I would recommend is that if you are going to hire a forester for some of the job, then keep a forester - preferably the same one - for the whole job.  I understand your hesitation about finding an honest logger - trust but verify - and if you don't know how to measure and grade logs, what the mills are paying this week, etc it could happen that you see 15 oak ends that are 24" long laying in a pile and you think that you got the short end of the stick when in reality there was a class of log that for some reason or another paid a whole lot more suddenly and it made more money to buck them to that length.  If you have a guy working for your best interest he can show you the math to justify the decision.  Just my $0.02 worth.   

[mike_belben]

You know who knows your local loggers?   You local sawmill scaler. 

Day in and day out, he knows which drivers bring in tidy logs all trimmed nice and bucked for best money.. And which guys are dragging in a mess that gets knocked down a grade because of the logger, not the log.   Go to the mills, get the price sheets, meet the scaler and ask him who he would want to log his yard.   The guy who makes tidy logs probably makes a tidy landing too. 

If you really want to know that youre getting your share, ride with the driver to the yard once or twice, bring a notebook and walk with the scaler.. Ask a few questions and get the footage printout, not just the check.  Your logger will know instantly that you are not the fella to short change if they are that type.

[Abeman]

Question,  what permit are you needing?

Town of Hyde Park requires a registered Forestor to apply for a permit to harvest timber.

[starmac]

Are you saying that in Hyde Park, you have to hire a forestor?

[BargeMonkey]

 Are you willing to put it out to bid and accept the amount it brings ? The quickest way to make friends with the loggers and forester is to have 20 diff people come walk It, bid the job and then have the landowner reject the bids because they didn't feel it brought enough. Find out what your cost to the forester is if you back out, I'm doing a job outside Albany and the landowner was on the hook for almost 2k just for marking and the plan, when the job only went for 5,300 bucks at bid.
What did the buyer from Wagner say ? Was it Chris Segina ? I purposely gave you 2 numbers so I wasn't biased, John has yrs of work, I haven't heard any bad things about Damon and I know he moves alot of wood and does good work, probably the safest bet as far as being paid and fair scale.

[Abeman]

Are you saying that in Hyde Park, you have to hire a forestor?

Yes, from what I've been told, and looking at the code...it appears the town needs a whole forestry plan provided to them from a legit Forestor for the permit.

Link to our lovely town harvesting ordinance: https://ecode360.com/14987313

[Abeman]

Are you willing to put it out to bid and accept the amount it brings ? The quickest way to make friends with the loggers and forester is to have 20 diff people come walk It, bid the job and then have the landowner reject the bids because they didn't feel it brought enough. Find out what your cost to the forester is if you back out, I'm doing a job outside Albany and the landowner was on the hook for almost 2k just for marking and the plan, when the job only went for 5,300 bucks at bid.
What did the buyer from Wagner say ? Was it Chris Segina ? I purposely gave you 2 numbers so I wasn't biased, John has yrs of work, I haven't heard any bad things about Damon and I know he moves alot of wood and does good work, probably the safest bet as far as being paid and fair scale.

Yes, If I decide to put it to bid I will honor the bid. I spoke with Damon, he has been very helpful and pointed me to a forestor who can get my permit and he offered to mark it with me and work on shares. I feel like working with someone like Damon is the way to go. But I'd still like to know what my volume of species is from an objective source...it may help to negotiate that shares agreement. One logger said he would do 70/30 on my black walnut.

[Southside]

The way I read your towns by laws, you don't NEED a forester to file for a permit, but unless you either have a bunch of time to figure out the whole thing or have a lot of knowledge in how the harvest will happen you will never satisfy the requirements of the permit application for approval.  If you happen to have a forest management plan in place than can be used in place of a permit application.   

I don't know, looking at those sort of restrictions if it were me I would probably sub-divide the whole thing, develop it into houses, take the money and leave that state all while telling the town lords to "bless your heart".  But that is just me. 

Given the language about violations which can result in fines and jail times I don't think I would try and do this without the benefit of a responsible professional overseeing it, either the forester or a pro logger who takes care of the whole thing for you. 

[Southside]

In case nobody explained the volume to you.  Assuming you get 20,000 ft of logs off your harvest you are looking at about 5 semi loads worth of wood. 

Around here a full crew will produce 10 or more loads in a day,  just to keep it in perspective on how many guys may be willing to look at your harvest. 

[coxy]

Are you saying that in Hyde Park, you have to hire a forestor?

Yes, from what I've been told, and looking at the code...it appears the town needs a whole forestry plan provided to them from a legit Forestor for the permit.

Link to our lovely town harvesting ordinance: https://ecode360.com/14987313

a few things about that permit  you have to be a 1/4 mile from any water or wet land  there is no mention of insurance  and if the ceo has a bad hair day he can do what ever he wants to do to you  and if they have a problem with the logging they hire a forester at the loggers expense  what a bunch of bull   It better be up to the LO and forester to tell anyone that is going to bid on the logs what is in the permit or give the bidders a copy of it so they know what there getting in to   I have never seen a permit like that   thanks for putting it on the FF   hope you do well with what ever you do up front pay or shares

[treeslayer2003]

regarding needing a forester to do or go over the permit, the county guy does that here. is it not that way every where? i do the plan, almost always a standard plan, forester marks any buffers and checks off the bmp check list. county forester does not get into any money.

to the OP, to be clear when i said get a reputable logger, i did not mean a saw mill. rather an independent logger. try to get several reputable guys to give you a price. see, independents will do their best to find the best prices. this usually means several sorts going to several different mills or buyers. see if your 50% is higher his is too. i have never herd of a mill paying a share, they flat rate, write a check.

[nativewolf]

Are you willing to put it out to bid and accept the amount it brings ? The quickest way to make friends with the loggers and forester is to have 20 diff people come walk It, bid the job and then have the landowner reject the bids because they didn't feel it brought enough. Find out what your cost to the forester is if you back out, I'm doing a job outside Albany and the landowner was on the hook for almost 2k just for marking and the plan, when the job only went for 5,300 bucks at bid.
What did the buyer from Wagner say ? Was it Chris Segina ? I purposely gave you 2 numbers so I wasn't biased, John has yrs of work, I haven't heard any bad things about Damon and I know he moves alot of wood and does good work, probably the safest bet as far as being paid and fair scale.

Yes, If I decide to put it to bid I will honor the bid. I spoke with Damon, he has been very helpful and pointed me to a forestor who can get my permit and he offered to mark it with me and work on shares. I feel like working with someone like Damon is the way to go. But I'd still like to know what my volume of species is from an objective source...it may help to negotiate that shares agreement. One logger said he would do 70/30 on my black walnut.

70/30 is a heck of a split.  70 for you i'd hope.   

[starmac]

Would you do the loggin for 30%. I guess that may be possible if sold on the landing and no trucking involved.

[coxy]

I will not pay more than 50% for hard wood  and I wont  pay more than15- 20% for soft wood  I think that's a fair price  I see guys paying(or say there paying) 60-70%  I don't see how you can pay that and market every thing on 30% I do a lot of calling for different buyers to get the most for the logs  jmop but most guys around here that pay that high price are just cutting them and sending them don't care what it cuts up at like cutting a 10fter back to a 9 to get a higher grade they want to be in and out again jmop

[BargeMonkey]

I will not pay more than 50% for hard wood  and I wont  pay more than15- 20% for soft wood  I think that's a fair price  I see guys paying(or say there paying) 60-70%  I don't see how you can pay that and market every thing on 30% I do a lot of calling for different buyers to get the most for the logs  jmop but most guys around here that pay that high price are just cutting them and sending them don't care what it cuts up at like cutting a 10fter back to a 9 to get a higher grade they want to be in and out again jmop

How could you afford to move to a job, especially 20-40k ft and pay 70% ? BW is something I don't know much about but still it would have to be rockstar quality stuff and almost be roadside. But wait, now they want proof of liability / comp, newer iron, I see guys claiming to pay this also and they are the guys around here who are one step from starvation and usually the landowner gets ripped off.
I'm dealing with this bigger logger from up north now, planning on taking all his HW firewood when ever they are down here, landowners look at you funny for paying 12-15 a cord, I'm not quite 50 on my truck or 1k a trailer in my yard, why even go to the woods ? 😂

[nativewolf]

It would have to be a walnut grove of great great quality to make it worth a 70/30.  I mean like $20k/acre great.  If you had 20 acres of that then ok...maybe I'd do 70/30.  I don't the the OP has that so..I don't know how to respond to 70/30.

[mills]

Down here white oak staves is our high dollar logs. One of the mills I sell too works with me to separate the stave wood from everything else. They then cut the checks for 60/40 for staves and 50/50 for everything else. When there are very few stave logs on a job the mill will split at 50/50. I'll keep a running total, and write the landowner a check when the job is done.

Also, I haul very little pulp wood. I'm lucky enough to get to pick the jobs I take. On these jobs, for pulp, I take only damaged or bad trees that need to go. The only clear cuts I do are when I'm working with a farmer that's cleaning up for crop ground. And then they normally take them down with an excavator. At $24 a ton no one is going to make very much.

And, I only cut on shares. From what I see either the timber buyer or the landowner is going to lose money. I've done several jobs on shares where the landowner was originally offered a set amount. So far they all made more money with me.

Took me several years to develop the above system, but I've found that it works better for me and the landowner. Good luck.