Astute forestland owners have noticed a surprising trend in local log markets. Re-tooled sawmills now thrive on smaller diameter logs, resulting in lower values for large logs. For example, many Inland Northwest sawmills are not very interested in purchasing logs over 27 inches in diameter on the large end.
This situation lends itself to many questions. Let’s take a look at a few of the key issues.
How did this situation come about? Over time, the supply of large sawlogs has decreased, so that small diameter logs currently make up a much higher proportion of the wood supply. (USFS policy greatly influenced this trend.) Consequently, sawmills have been redesigned to maximize efficiency when cutting lumber from small logs. Some of these new facilities can turn a small log into lumber in fewer than three seconds!
What size logs will mills now accept? As one would expect, the answer to this question varies by sawmill. A common breaking point for “oversized” logs is 27 inches in diameter, as measured from outside the bark on the large end of the log. Some mills use 16 inches as their break point. Most facilities still accept logs larger than their desired specifications, but they pay less for them or require special lengths, such as peeler lengths.
How has this change affected log and stumpage values? As mentioned, many sawmills now pay less for large logs. Sometimes the reduction in value is over one hundred dollars per thousand board feet.
Due to more discriminating log-size requirements, there have been other cost changes as well. Since fewer mills process large logs, logging costs often increase because of greater hauling distances and log sorting costs.
In addition, the necessity to cut large logs into unique lengths can complicate logging operations, thus creating the potential for expensive mistakes. If proper lengths are not cut, or if errors are made when sorting large logs, much lower revenue is realized from a timber sale.
Are all species affected equally? No. Currently, ponderosa pine and western redcedar (in most cases) are not adversely affected by size constraints.
The Big Questions
How will this recent development in log markets impact the long-term management and value of Inland Northwest forests? Should prudent landowners liquidate their large trees now, rather than risk losing value in the future?
These questions go to the heart of a tough issue. For example, it is often desirable to maintain the largest and most vigorous trees within the forest. Large trees can enhance the beauty and long-term productivity of the forest, while providing valuable wildlife habitat and a high quality seed source for future generations. Yet, if current trends continue, the economic value of these large trees will diminish.
There are no easy answers to these questions. Hopefully, the following recommendations will help guide the future management of your big trees.
- If you have a timber sale involving large logs, be sure these logs are cut to the proper length and sent to the most financially advantageous mill. The assistance of a consulting forester can be extremely valuable in this area.
- If maximizing financial gain is your primary objective and aesthetics are not a priority, consider harvesting a greater percentage of your larger diameter timber. Of course, this type of harvesting must be applied in situations that are consistent with sound, forest management practices. Reforestation also may be necessary following such a harvest.
- For landowners who embrace a wide range of objectives, little change in forest management practices is necessary. In this case, the risk of incrementally lower economic value of large trees must be weighed against the other benefits these trees provide.