Log Prices

[John Woodworth]

Just got a new Price sheet yesterday from Merrill and Ring and it's finaly reached the point of why waist the time. I've never seen prices this bad, load prices wouldn't even cover trucking in some cases.
Cedar and Alder which normaly have held a fair price are down over 50% yet the lumber price at the lumber yards sure hasn't dropped.
Fortunatly all my equipment is paid for and it doesn't cost anything having them sit here at home.
I love the woods but it's been one slap in the face after another and now the goody goody boys are bringing back the Spotted Owl garbage and this work for nothing so somebody else can profit from my labor, time to back up and regroup.
Maybe if enough of us backed off and by the time people start using Ferns and Corn Cobs for their daily duty we might win.

[madhatte]

It's getting to where we can't even get anybody to bid because the gyppo outfits we usually sell to are leery of getting stuck with loads they can't move.  Several of our sales are gonna end up being 2-year contracts so we can all ride out the bad times.  Meanwhile, we're still laying out sales and cruising and marking, as though there was still a market.  Our management strategy requires tree removal for stand improvement.  No sales = no forest management.  We're all in trouble these days. 

[Brian Beauchamp]

I got quoted $.05 for pallet and $.10 for grade across the board just yesterday on some storm damaged timber...understandable for what is being sold, but stumpage of standing, healthy trees isn't far off of that though. Pretty pathetic. I've told all my landowners that don't have an emergency need for cash or something to salvage to hold onto it until this funk passes. I just hope we have some loggers and mills left to sell to by the time it passes.

[mad murdock]

The doldrums are hitting hard in all sectors.  Helifor Canada has gone out of business, they were a joint venture deal between Columbia Helicopters, and a Canadian Company that Heli-logged.  There are alot of heavy-lift helicopter operators here in the NW that are really on the skids( no pun intended), and the company I work for ( a light helicopter operator, providing aerial aplication to the timber industry), has seen a pretty big pull back in operations by all of the major timberland owners.  They are not spraying anything unless it is in immediate danger of being choked out this growing season.  The number of long-load haulers in Oregon that you see on the road from day to day has dropped significantly too.  I used to see on an average day 6-10 log trucks a day on my 22 mile commute to work, now I see maybe 2- or 3 at most. We are all just trying to hold on tight and ride it out, in the mean time, looking for any way to turn an honest buck until things improve.

[redprospector]

Well, I guess I should feel a little better knowing that I'm not the only one in this boat (but I don't).
The two bigger mill's around here have closed down, never to be reopened. The mill that I used to sell all of my log's to closed last summer. The owner is 77 years old, and finally decided he was tired. The only other mill close, lost their contract with the oilfield for 3x12's so they only fire up the mill one or two day's a week. They do their own logging too, so they don't buy anything that's not standing.
There are 3 or 4 of us running our bandsaw mill's (mostly so we'll have an excuse to keep doing a little logging), but there's not much of a market for anything here. I'm just hoping that I can get it sold before it rots.
Everything is paid for, so if it don't run, it don't eat. But I'm fast approaching the point that if I don't run, I won't be able to eat either.

Andy

[chucker]

  i did pick up on a small clearing job with a few nicer ash trees in the 30" range  with a couple of white and red oaks for saw logs . with the price of lumber/logs being down i am wondering if its worth saveing them for the saw or just cut them for the fire wood pile??? most of the ash should be 16 feet long/20" tops.. oaks are notthat tall so might make a good 10 ft. in all theres a good 2.5 cd.

[woodmills1]

Unlike previous years, when the mud season hit, the log buyers did not return to buying logs.  Pine has always slowed at some point in feb. or march, but then the market returns some time in march or april.  This year it hasen't returned.  The only logs I can sell right now are pallet grade, going to a landscape timber producer at 100 bucks per thousand.  It is a shame to see clear logs going for that use.

[Sawyerfortyish]

I won't sell any log for that. I always said if a log didn't bring.50 I'll saw it.  I figure the oak logs even if they lay here more than a year are still low grade and I get 1.25 for that. But for now the good butt logs I'm sawing and running it through the kilns and making flooring. Pine I try to get it cut and on sticks so the grubs don't drill it full of holes.

[woodmills1]

the trouble for me is I still don't have the room because my driveway work is still not done.  I settled up with the excavator guy who didn't finish the job, for short money and have a new guy coming in next week.  I have been working in a very small space since the snow left.  Yes, it is sad to sell good pine for a dime, but my tree guys have been stuffing me with it so no room means it has to go out.  soon I will do just what you say cut and sticker.  With the LT 70 now I should save much time.  I don't sell any oak logs I save them for the horse fence crowd.

[WILDSAWMILL]

theres a land owner here got about 2 semi loads of white oak logs hes trying to sell they were loged last fall or late summer any idea what wood be fair to offer him
i dont have a market for that much but wood like a deal

[chucker]

 theres a few questions to be answered first, like what size as diamete, lengths and if there northern or southern white oaks  ? before a good offer could be advised..... such as northern white oaks or reds from the north have tighter grains then that of the southern .....

[Chico]

Or  Appalachian I'd take a lookto see if maybe thee may be some veneer in it  I think if the price is good enough and I d buy it saw the highest grade stack it and either leave the rest for pallet qr ties jmo
Chico

[woodmills1]

Too many variables to really say with out looking at the logs.

Here is the data on white oak from the 4/11/09 hard wood market report, with prices per thousand green in traincar load quantites

northern                    appalachian               southern
4/4                            4/4                          4/4
FAS 940                     800                         770
SEL 765                      790                        760
#1 520                       450                        450
#2 350                       325                        315
#3 280                       265                        255

So, assuming you get the same amount of each grade from a load of northern logs. (not a good assumption but a point to begin discussion) You would have an average of $571/1000 bd ft.  Lets say you find a hungry sawyer for $150 per and can move the logs and or lumber for $80 per to give a total of 230 for costs.  How much of the 341 dollars left would you be willing to pay for the logs?

[woodmills1]

Or lets say you have a paid for sawmill and truck to do hauling and delivery, as well as a customer who makes barrels.  He will buy true quartersawn white oak at $3.00 per bd ft off the mill and will take down to 3 inch widths, and since he makes barrels of different heights he doesn't care about knots.

assuming you can yield 50% true quartersawn you would see $1500/1000 bd ft and have another 50% of flat and rift sawn but probably mostly narrow lumber.  If that comes out at the average from above thats another $285/1000

now how much would you pay for the logs?

[chucker]

so assuming there 100" with 8" tops and 10 cords to a semi load, 800.00 would not be all that bad .... good to better w.oak even around here is a commodity...........

[Bibbyman]

We don't buy many logs and most of those we buy come from one local logger.  We are trying to keep our prices up just because everyone has to make a little money but I think Mary is being a bit harder on knocking back for major defects.  We tend to get a lot of logs that are, well, junk.  Before, we could just absorb the junk logs in the cost of doing business. 

Prices for 4/4 oak grade lumber keep falling at about 10% a month.  This month for red oak they are paying $595/mbf for FAS and F1F, 425 for 1C, 395 for 2C, 325 for 3C and 75 for 3BC.  White oak prices are not as good by 40-50/mbf.  These prices are considerably less than those posted by Woodmills1 above.

We can get a good price for ties and beams but it takes logs that are solid, sound and straight.   Half the logs we get can't be made into ties or beams.  These wait for lumber orders or, if not good enough for lumber, we make firewood out of them.  Right now, we've got more firewood logs on the lot than sawlogs!

[chucker]

  such is the case around here ! the value of a # 1 log is better to stay upright and alive an to be select cut on a special order then to wait it out on the skidway...

[woodmills1]

Also, don't forget my trees are almost exclusivly taken down by tree service companies.  They get paid by the homeowners when I take out the logs and leftovers.  They have been giving me more firewood to make up for the falling log values.  The companies I pick up for do not want to go back to hauling their own pine to where ever or who ever will take it.  I get more than enough pine, so I must turn it over due to its short shelf life.  I got a check yesterday for a 2505 bd ft load delivered  on 4/22 just before they stopped taking any pine but pallett.  It paid $265/1000 for #1 and $100 for pallet

[Corley5]

Woods run 10' sugar maple logs are paying 200 dollars a cord and basswood 10s are paying 110 a cord delivered to the mill.  That mill is only paying 85 $ a cord for 100" maple sawbolts while the flooring mill down the road is paying 135 but there's rumor that the flooring mill may quit buying for a few weeks at the end of the month  :-\  They've got over 1200 cords in inventory with stain season coming fast  :  For 85 I'll put them in the firewood pile.  Times are tight.  No ones selling stumpage, a couple long time mills have shut their doors until things level out, the company that hauls my logs normally would move 5 or 6 loads of logs a day are now doing two or three and if it wasn't for the booming 100" firewood market he'd be laying off drivers and parking trucks.

[Ron Scott]

It's the same thing here. I have a number of landowner potential timber sale areas of "good wood" that I haven't spent the time to selectively mark for cutting yet. No since putting paint marks on trees if there's no markets or loggers available for the wood or do the harvest.

I 've had a large area of oak and maple marked and on the market for some time and the only offers are those who want to cut it for firewood only. I won't sell "good wood" of mostly sawlogs for just firewood. It would also take them forever to harvest all the wood on the area for just firewood.

One of my steady wood buyers wanted it, but his mill hasn't milled any logs since the first of the year. He says he still wants the sale if he can find any mill markets. So no sense preparing more wood for sale if there is "no market". I don't want to give the landowner's wood away either.  ;)

[Bibbyman]

In talking with our local logger,  I asked him why land owners were still willing to get their timber cut considering the low prices and bad markets.  He said he has more jobs lined up than every.  Land owners are afraid of the economy and are trying to convert as much to money as they can (I assume fearing that it will only get worse).

I know that for the past six months or so we've had calls from land owners wanting to ask about prices of logs, etc.  Some had loggers appraise their timber and others were considering doing some logging themselves.  We advise leaving them stand if they are in good health or otherwise need to be removed.

The land owners around here seldom regard timber as an asset that can grow in value.   Some see it as a retirement investment or rainy day asset.

[Sawyerfortyish]

I've had an increase in people calling about a tree in there yard. I'm getting about 3 calls a day. I won't touch any of these trees.

[woodmills1]

Yard trees are where I get my logs.  Due to the major ice storm early last winter it seems like no one wants any trees close to their house.  All of the tree services are busy

[Cedarman]

Bibbyman, people will sell there trees at bottom prices the same as people sell their stocks at the bottom.  They fear they will lose what little they have left and they usually do.

[Bibbyman]

Even my dad has suggested I cut some of our own timber.  It don't make sense to cut our own with markets so low and prices of logs are low. 

[Ron Wenrich]

We had a local mill owner that had thousands of acres of timber.  The only time he cut his own timber was when prices were way high, and stumpage prices were high.  When stumpage was low, he cut other people's timber.  Smart man, and wealthy.

[woodmills1]

todays market report was the first in months where nothing green went down in price, and very little went down on the dried lists

[Cedarman]

My export broker just told me that poplar is the only hardwood he is moving and that he will need the next 3 months production from one of his suppliers.  He also said US lumber sales are down 70%.   This tells me that those that do survive will be in demand as business picks up.  Timber will be cheap, but loggers and mills should make money again.

[Ron Wenrich]

We can move tulip poplar and white oak.  Red oak lumber is dead, but can move some casket lumber.  The cant market is totally dead.  We've only moved a load or two in the past several months.

Our veneer markets are also drying up.  They usually do in the summer. 

[mad murdock]

Casket market... not to sound too morbid, but with the baby-boomers getting older, an dpushing on, there likely will be no drop in that market, unless they offer carbon credits for getting cremated!?!;)

[chucker]

 being a boomer myself and the low market price on logs . i sure dont look forward to seeing the up side of the market none to soon !!! lol here in n.minn. the market used to be bass wood and balsam for casket making... now the trendy ways of the funeral homes are pushing up oak,ash and maple... go figure if theres better prices there ??

[John Woodworth]

Another new price sheet today, makes you want to through your arms in the air and say what's the use. Maybe about the tine people start using corncobs and ferns for TP and quit building houses for a while the mills will get the message, they sure haven't lowered their prices much yet want the raw product for next to nothing.

[fishpharmer]

I called my logger friend yesterday.  He says hardwood pulp is bringing $4-8 per ton to the landowner. 

[Ron Wenrich]

Another new price sheet today, makes you want to through your arms in the air and say what's the use. Maybe about the tine people start using corncobs and ferns for TP and quit building houses for a while the mills will get the message, they sure haven't lowered their prices much yet want the raw product for next to nothing.

Those mills are really hogging all the profits.  A few years ago, red oak was in the $1200/Mbf range for uppers.  Now its $630, when you can find a market.  Last October we were getting $1500/Mbf for white oak.  Now its $800.  Pallet stock is down $60/Mbf for a low value product.  Ash has been in the dumper for years.  And even walnut has lost its luster.  Mills also were buying logs in a falling market, losing money all the way down.

When the housing market was going into its bubble, guys went and upped their production.  That happened in the woods and in the mills.  I talked to a logger who was almost ashamed at how much money he was making.  When the bubble popped, it hurt everyone. 

We have a lot of guys that have closed or throttled back production.  That will help the supply problem.  But, when things get better, wholesalers are really worried that there won't be enough production capacity to meet demand.  Its a matter of surviving for the moment. 

[Cedarman]

All the timber that didn't get logged last year and this year is still on the stump putting on even more wood.  When times get better, if they do get better, stumpage will be cheap for quite some time.  Fewer loggers, more trees, economics dictates it.  If oil goes sky high and biomass takes off in demand, things will get very interesting.

[Kansas]

We have a lot of guys that have closed or throttled back production.  That will help the supply problem.  But, when things get better, wholesalers are really worried that there won't be enough production capacity to meet demand.  Its a matter of surviving for the moment.

I agree with that. This has gone on long enough that enough producers, both in the timber, and the sawmill side, have been pushed to the brink or gone out of business that there will be a time down the road when production will be way short of the market. Here in Kansas we had basically 4 mills that you could go to for the conventional grade markets for good logs. One is doing very little due to family issues. 2 of them are still operating, but barely. Loggers are waiting to get paid for logs hauled 6 months ago. The other is going, but 125 miles away from my area. What worries me is that with lost markets, and 4 dollar corn, landowners will look at trees as a nuisance and not a commodity. We used to have a standing rule at our mill that we always bought cottonwood and most any species at the gate. We bought walnut, oak and maple and sent a lot of that to the other mills.  Those markets are mostly closed now.  We have had to shut down buying, simply because we were the last mill buying, and are overrun with logs we need to get used up.

[Banjo picker]

My son and I went for a little drive yesterday to look at an edger we had been told about.  We didn't find it, but I did find an empty lot where a medium sized sawmill had been.  Completly gone.  Wonder where those logs are going now.  Tim

[Frickman]

Ron said that alot of guys have throttled back production. I'm one of them. I'm sending little or no wood into the wholesale grade market. I'm only cutting special orders and firewood. With the extra time on my hands I've been upgrading and updating my equipment so I'll be ready to go when things pick up again. The mill and most of the equipment are paid for and they don't eat any hay so they can sit under the roof for a while.

I have a bunch of timber either bought or nearly under contract that I'm holding off cutting. I have advised all my landowners to wait until prices improve before they harvest. I could use the extra work right now for sure, but I can't in good conscious pay them for stumpage what the market is dictating right now.

[fishpharmer]

http://msucares.com/forestry/prices/reports/2009/1.pdf

You might find this interesting.

[PAFaller]

Personal opinion, but I think we are going to have to get used to lower log and lumber prices, and landowners will have to get used to lower stumpage rates. Its evident and no big secret that this housing bubble and the rates of new home construction were not sustainable. So too was the increased prices and demand for timber. I am not saying that these prices where logs are worth less than firewood are at all fair, but I dont expect to see big hikes in prices any time soon, nor do I or anyone I know seem to think we will see the rates of a couple years ago. That being said, maybe it will help convince landowners to take a pro-active approach to management and do gentle thinnings on 10-12 year intervals to maximize their timber value and their land investment. Just my thoughts but this might be the new normal for a while. Greg

[ID4ster]

Ron,

Why do prices for veneer fall in the summer and what month do they start falling? Out here in Idaho, in normal times, we can expect the price for ponderosa pine to fall beginning in July or mid June. So its' interesting to me to see that veneer prices fall in the summer also. Also what grading rules or publication do you use to determine what a veneer log looks like on the stump?

[Ron Wenrich]

A lot of veneer goes for export.  Export buyers don't buy veneer logs in the summer.  They usually buy from September to April/May.  The biggest problem is sap stain.  The white woods can stain pretty quick in hot weather, especially in ship holds or in containers.  Wood like ash and oak are susceptible to bug infestations.  You might not be able to see them, but they'll show up down the line.  Cool and cold weather avoid those problems.

We do have a few domestic mills that buy all year long.  They can pick and choose pretty much whatever they want in the summer. 

On the stump its a lot harder to tell what's veneer.  For most species, you'll be able to see the defects from the outside that will limit the value.  Some guys will miss things like bud sprouts or grub holes.  But, there are things you simply can't see from the outside.

A lot of the white woods need a certain percentage of sapwood, or it won't make veneer.  Ash, maple, birch and tulip poplar are the ones in my area.  Sometimes there is a certain number of rings per inch a buyer will pay premium.  There's also certain worms, such as glass worm that you won't see until you spray water on the log.   Some species are prone to mineral in certain areas, and even cherry has the gum streak defect that will negate veneer values.  You won't see that on a standing tree.

I always have to chuckle when a forester marks a stand of timber and puts a figure in there about veneer value.  Some will even make comments on the quality of the stand.  I've seen a lot of logs that look good, but simply don't cut out as good as it looks.  A lot of that has to do with past management practices that have healed over. 

Timber buyers have a much better feel for the veneer value.  There aren't any grading rules or publications that can match a well trained and experienced buyer. 

[Jasperfield]

Do any of the Forest / Timber industry organizations offer a "log grading" course?

[chucker]

 >:(  YUPP!!  but its always at the expence of the seller....... :D

[Ron Wenrich]

The Forest Service came up with a way to grade logs.  They also came up with predicted grade recovery from logs using their grade and a method of grading timber based on those log grades.

But, only a few mills use those rules.  Most mills make up their own based on their local markets and what it takes to get logs in the gates.  I tried using those grades at one mill and had to add a few to make it competitive with the other local mills.

For example, many mills buy a tie grade log.  It grades out as a #3, but needs to be a little better and a little bigger.  Prices can be double for a tie grade log.  The #3 is usually called a pallet grade log.

Yields from the Forest Service were for sawing logs down to all boards of various thickness.  Few mills operate like that.  It was also done in a mill in New England.  Our black oak is a lot different than theirs.  So, although the yield study was nice, it wasn't specific to a wide range of mills.  Each mill has different cutting patterns and it probably varies from sawyer to sawyer.

Instead of a log grading course, a log bucking course is a better one.  That's where values are set.