AG: Trees for Lumber and Cash Crops

By pjain      Published July 7, 2021, 8:20 a.m. in blog Invest   

Investing in Ag Land for

Cost of Nursery Trees

Cost of Jobbers

High Value Trees

When successfully harvested, high-value trees can yield profitable high-grade lumber and fine veneer quality plywood. These highly sought after trees can best be described as tall, straight, large in diameter, hardwood trees with no obvious defects to the stem.

Particle low quality

So while all wood even brush can be used, and there’s a commercial value of some sort to almost everything on a woodlot. However, they may have little financial gain that can be found in high-value trees. Others may end up as ground up low value much!

Softwood mainly Pine

About 80 percent of all timber comes from softwood.

Loblolly Pine

Loblolly Pine is the most commercially planted softwood tree in the United Sates covering more than 50 million acres mostly in the Southwest grown primarily in Georgia and South Carolina.

Loblolly Pine is adaptable to many types of soil and growing conditions and as such is planted throughout the Southern United States where it grows rapidly in sandy loam soils. It is grown primarily for pole wood, pulpwood and second grade lumber.

In just 20 to 25 years it stands 40 to 50 feet tall and 12 inches across at the base. Plantations are typically harvested for short width dimensional lumber or pole wood and replanted. Left to grow, this tree can reach 100 or more feet and over 4 feet in diameter

Pine Straw

Loblolly Pine needles are in bundles of three, sometimes twisted, and are used to make a natural bed of mulch for landscape and garden.

Loblolly Pine tree farmers can earn a pretty good income selling Pine Straw – the bed of needles that build up under the trees season to season.

Landscapers, garden centers and nurseries prefer to use Pine Straw as a mulch because it remains loose and allows air and water to infiltrate the ground below, unlike firmer mulches that tend to crust over. A pinestraw raking schedule of every 2-3 years can generate $100-$200 of income per acre.

White Pine

White Pine has bundles of five straight 5-inch needles.

Hardwood

While only 20% of timber, but the smaller percentage of hardwoods offer the most value.

Hardwoods grow at slower rates than softwoods, which makes them denser. Denser wood is harder, stronger, more durable and usually lasts longer. Hardwoods are also characterized by distinct grain patterns and variations of color, which make them aesthetically attractive.

Some of the most recognized hardwoods include maple, oak, ash, beech, sycamore, alder and cherry.

Hybrid poplar grows really fast and common to PA. But, it is a very low density wood. That means you'll need more volume to replace the lack of weight when you're throwing it into your stove.

Better burning hardwoods are slower growing, like oak, beech, maple, and hickory. Its due to their density.

Sugar maple is better than red maple. White oak would be marginally better than red oak.

Legacy Hardwood like Walnut

Tree Size - Think and Tall Trunks Yield Cordage!

High-value timber and veneer is sold by the board foot, which is a piece of wood that measures 12-inch by 12-inch by 1-inch.

Trees that are taller and larger in diameter will bring higher sale prices because they have more usable volume.

A tree’s volume can be determined by measuring its diameter at the 4.5-foot mark and estimating how many feet up the tree can be used to make board feet.

Quality of Wood

Strength from Consistent Growth Rings

One characteristic of quality trees is consistent growth rings. These growth rings are produced when trees have ideal conditions to grow at a constant rate each year.

The best way to ensure this is by letting high-value trees reach their full maturity.

Few Knots, crooks

Trees that are straight with few branches on the lower portion of the tree are also considered to be high quality. Any deviations to the tree stem such as knots, crooks and sweeps reduce product value because they can weaken the strength of the wood.

Logs with small centered hearts and bright white color are also considered to be high quality.

Choice of Trees for Lumber

Selecting tree for your Zone and Conditions

Fast-grown Trees make Problem Lumber with Weak Wood

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Taking care of Lumber Trees

Flat Land lots are far more Valueable than ridges, hilly forests

Loggers favor working on flat, well-drained tracts of land because it allows them to use the most efficient means of tree harvesting. Woodlands that have steep slopes and moist ground lead to difficulties with equipment impacting the harvest rate.

Hardwood and rough terrain logging in many areas is still highly dependent on skilled hand fallers in areas of steep ground and sometimes hard-to-access timber. These areas are usually worked by hand fallers and skidded with dozers as they are more stable than wheeled skidders.

The more automated modern tree side branch shearing and preprocessing loved by sawmills may not be possible.

Buying from Nursery Trees

Ground Prep

Planting and Support

Irrigation to Independence

Youth and Harsh Conditions - Frost, Strong Winds

Maintain - Pruning

Maintain - Brush, Fires, etc.

Diseases, Parasites

Hiring the right Loggers is Tough

One of the toughest challenges for landowners is finding the right certified logging professional to harvest high-value trees.

Landowners that rush through this process and choose the wrong logger may find themselves disappointed with the final results. For landowners to get what they want, they need to complete their due diligence by checking references and really getting to know the logging contractor.

Harvesting Jobbers

The production costs that logging contractors and timber buyers deal with during a tree harvest also play an important part in the landowner’s final profit margin. Woodland size, ease of logging, site accessibility are some examples.

Logging contractors strongly prefer harvesting large volumes of trees with uniform characteristics because it correlates to lower fixed costs per job. Fixed costs are the costs that loggers have to pay regardless of how many hours they use their machinery. These include insurance, interest, taxes, storage and equipment depreciation.

Logging trucks play a key role in tree harvesting by moving heavy equipment in and removing harvested timber out. Narrow, steep or substandard roads often hinder the site accessibility of equipment and logging trucks. Whether it’s finding alternate routes or building temporary roadways, it costs logging contractors more time and money to make the necessary adjustments affecting a landowner’s earning potential.

Saw Mill Access and Concentration

Market value can also be affected by local conditions such as competition, inventory and weather. Timber mills in the U.S. are highly competitive; success centers around efficiency.

Distance to a processing mill

Proximity of timber to a mill goes a long way in efficiency so mills will sometimes pay higher prices for timber to have lower delivery costs.

After timber is harvested and loaded, logging contractors focus on weight and distance. The farther away that harvested timber is from a processing mill, the more the loggers have to pay for gas, thus shrinking their final profit margins.

Supply and Demand Fluctuates and Business Cycles

The strength of the overall timber market is constantly changing due to supply and demand.

Lumber supply can be affected by a number of variables including the willingness of landowners to put their timber on the market, current trends in land conservation that limit tree harvesting, economic conditions and competition from other countries.

Landbank investing has increased supply esp. in Southeast US on Florida and Texas etc. Basically growing trees waiting for land to appreciate in value.

Demand relates to the need for finished wood products such as lumber and paper. The timber market is also closely related to the housing market. When the economy is good, people tend to build more houses, which requires more wood.

Marketing Timing of Timber Sales

Large-scale timber harvests may only take place once or twice in a lifetime for some landowners. Basically their lot would mature in a tiny fraction of years of the total 10-20+ years of growth.

A common challenge among landowners is achieving maximum profit from their harvest. One way this occurs is when high-value trees are harvested before they have reached full maturity. This could be due to cash flow issues farmer may face.

So if cut as tree reaches 15" diameter, the cord yield may be much less then let it grow to 18" or 20" - both in width as well as height of tree goes up a lot. So you may want to let the best trees in the stand get to those sizes,” he said. “Cutting healthy trees before they’ve accrued full value is like taking huge penalties by cashing in retirement funds early

Landowners would want to sell into a hot market to get the most money that they can for their assets.

On the flip side, buyers need to purchase timber with future markets in mind to maintain a profitable business.

In either case, to get the most profit it is absolutely necessary to stay on top of current market trends.

Using Consulting forester Professionals

Consulting foresters have no ties or obligations to any wood production or forest product company. Their goal is to simply offer land management advice centered around the landowner’s personal goals.

  1. Foresters can offer their expertise and provide sanity in highly emotional decision making.

  2. They help develop a long-term management plan for a tract of land.

  3. More sophisticated evaluation of lots - incremental harvesting, and even planning next cycle of planting, etc. as compared to brutal simple clean-cutting. They can maximize present and future economic value by identifying which trees to harvest and which trees to retain in the forest.

  4. Inventory, Assessment, Help get Financing. Foresters are able to prepare an accurate inventory of what is to be offered for sale including species, number of trees, volume, quality and estimated value.

  5. Economic Value Optimization. They can help landowners to get the maximum price for their timber due to their extensive knowledge in the areas of tree value, markets and buyers.

  6. Network of Contacts, Avoid mistakes. Landowners can even hire foresters to negotiate contracts and to monitor the activities of a logger to ensure that everything is being done correctly.

Even after consulting fees using forestry services landowners are usually able to generate more revenue than conducting a full timber harvest and sale.

Seasonality - Wet cuts supply

Whenever timber manufacturing facilities are low in inventory they are more likely to go out on the open market where they will pay premium prices for timber. Timber manufacturing facilities tend to be low on timber during the wet seasons so they are often willing to pay more money to landowners with dry and accessible tracts of land.

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Wildfires, Environment Myths -- xfr --

Forests are a multi-decade management

Forests are a living, breathing and constantly changing ecosystem.

If they understood forest dynamics, the landowner’s goals and what the foresters are trying to do then they might change their opinion.”

Cutting Trees is Evil - Not!

The public just sees a hillside that has been thinned out and harvesting equipment along a roadside where there are a bunch of logs and trees dragged out.

Of course they are living in or sitting on furniture made from wood that has to come from somewhere!

The biggest challenge to forest management services is overcoming the public perception that the cutting of trees has a significant negative impact on the environment. Negative opinions are often shaped by values, attitudes and beliefs. There is a general lack of knowledge among most people when it comes to forest ecology.

Growing Trees for Profit -- xfr --

Non-timber Firewood Lots

Profitable Trees to Grow

Home Landscaping Trees

Fast growing trees give homeowners the opportunity to realize the benefits of a mature tree sooner. Individuals seem to especially focus on using fast growing shade trees and fast growing hedges in their landscape to reap the benefits of these value added landscape design practices sooner.

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