OT: looking for a previous thread about pine trees/timber
- Thread starter SirBarksalot
- Start date
Planting season is about to catch another gear. Depending on how many you need some of the foresters may have some leftovers after a job. Pines aren’t that expensive unless you want containerzed long leaf. 550 will run around $50
slash and loblolly come in bundles of 1000
slash and loblolly come in bundles of 1000
I use some local guys here in SE MISSISSIPPI. Not sure where you are. Ask your local extension service for the names of your local forestry association. Or if you know anybody who works for one of the timber companies around where you live.
Timber in the South and especially Mississippi is going through a financial
depression some say is worse than what happened with the economy in 1929. A multitude of factors causing the problem.
1) Housing starts down
2) Not enough competition for raw material from mills, same few companies own all the mills and they are fewer but more productive
3) Mills are much more efficient than they used to be getting much more lumber out of less raw material
4) Huge oversupply due to so many people taking land out of farming and putting into trees thinking it was a safe bet
5) Motivated sellers and patient buyers, timber buyers market adding to the problem
depression some say is worse than what happened with the economy in 1929. A multitude of factors causing the problem.
1) Housing starts down
2) Not enough competition for raw material from mills, same few companies own all the mills and they are fewer but more productive
3) Mills are much more efficient than they used to be getting much more lumber out of less raw material
4) Huge oversupply due to so many people taking land out of farming and putting into trees thinking it was a safe bet
5) Motivated sellers and patient buyers, timber buyers market adding to the problem
A few missing/incorrect points.
1- housing starts are not "down" the increase is slowing but it is still ticking up, nationally and regionally.
2- land is more productive. Hybrid seedlings are growing faster, producing saw logs in 30 years vs 45 a generation or two ago.
3-yellow pine has fallen out of favor with builders. It warps more than SPF and strength is reduced from fast growth so #2 yellow pine is only spanning 75% of what it could in the 80's.
4- engineered wood is much easier to build with. I joists make the world go round when everyone wants open floor plans. OSB and plywood sheathing is going the way of the dodo. Google T-ply... 3500 SF two story homes now use 1/32" thick cardboard as sheathing everywhere but the roof and around garage doors... Which is disgusting.
This is an article from the WSJ from earlier this year but based out of Starkville. I've sent it to a lot of people that dont realize what all happened. Excuse the way some of the formatting ended up.
Thousands of Southerners Planted Trees for Retirement. It Didn’t Work.
Too much pine and not enough saw mills spell years of depressed prices for plantations
STARKVILLE, Miss.—Over the past hundred years, the George family’s farm has been sharecropped, grazed by cattle and planted with cotton. By the late 1980s, Clayton George was growing soybeans and struggling to make ends meet.
A new federal program offered farmers money to reforest depleted land. Pine trees appealed to Mr. George. He bought loblolly seedlings and pulled his pickup into a parking lot where hands-for-hire congregated.
“We figured we’d plant trees and come back and harvest it in 30 years and in the meantime go into town to make a living doing something else,” he said.
Three decades later the trees are ready to cut, and Mr. George is learning how many other Southerners had the same idea.
A glut of timber has piled up in the Southeast. There are far more ready-to-cut trees than the region’s mills can saw or pulp. The surfeit has crushed timber prices in Mississippi, Alabama and several other states.
Wall of Wood
The volume of Southern yellow pine, used in housing and to make paper, has surged in recent decades as farmers replaced cropland with trees and as clear-cut forests were replanted. By 2020, the amount of wood growing per acre of timberland in many counties will have more than quadrupled since 1980, U.S. forestry officials estimate.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image001.gif
Volume of Southern Yellow Pine per acre of timberland
200
400
800 cubic feet
100
Insufficient data
Source: USDA Forest Service, Forest Inventory and Analysis Program
It has been a big loser for some financial investors, among them the country’s largest pension fund. The California Public Employees’ Retirement System spent more than $2 billion on Southern timberland, and harvested trees at depressed prices to pay interest on money borrowed to buy. Calpers sold much of its land this summer at a loss. A spokeswoman for the pension fund declined to comment.
It’s also been tough for the individuals and families who own much of the South’s forestland, and who had banked on its operating as a college fund or retirement account. The region has more than six million owners of at least 10 wooded acres, say academics and forestry consultants. Many of the owners were counting on forests as a long-term investment that could be replenished and passed on to heirs.
“If you work and you didn’t want to put all your money in the stock market, you’d buy 40 acres and plant trees and they’d be ready to cut by the time your kid went to college,” said Skip Stead, a timber broker in Lincoln, Ala. “It’s like a 401(k).”
The housing crash 10 years ago worsened the developing timber glut by depressing lumber demand and prompting woodland owners to postpone harvests. Mills closed.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image002.jpg
Michael Counter grades lumber cut at a PotlatchDeltic saw mill in Arkansas. PHOTO: KAREN E. SEGRAVE FOR THE WALL STREET JOURNAL
Housing has come back in much of the country, pushing prices for finished forest products such as two-by-fours and plywood to historic highs during the spring and summer building season. Prices for logs, as well, have moved up in the U.S.’s other big timber-producing region, the Pacific Northwest, where supply is kept in check by wood-boring beetles and periodic wildfires.
In the South, timber prices haven’t stopped sliding. Adjusted for inflation, the price of Southern pine is down about 45% since 2007, according to Daowei Zhang, an Auburn University professor of forest economics. So-called saw timber, for making lumber, is at a 50-year low, adjusted for inflation.
Corporate owners of far-flung timber tracts can concentrate logging in regional markets where prices are healthier, such as Savannah, Ga., and Charleston, S.C., which have access to ocean shipping. Timber companies that own saw mills, such as PotlatchDeltic Corp. , can buy local logs on the cheap.
Log Rhythm
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image003.jpg
…and housing starts have climbed steadily since last decade's foreclosure crisis…
Lumber prices reached historic highs this year…
Lumber prices
Housing starts*
per 1,000 board feet
$600
2.5
million
500
2.0
400
1.5
300
1.0
200
0.5
100
WEEKLY PRICE
0
0
1990s
’10s
2000s
1990s
’10s
2000s
…and average prices for standing pine saw timber in the South have yet to recover from last decade's housing crash.
…yet the volume of standing Southern yellow pine has increased 30% over the last 30 years…
Southern pine saw timber price†
Southern yellow pine volume
a ton
$60
300
billion cubic feet
50
250
40
200
30
150
20
100
10
50
0
0
1990
2000
’10
’97
2007
’12
’17
1987
*Seasonally adjusted annual rate †adjusted for inflation, 2018 price for second quarter
Sources: FactSet (lumber price); Commerce Department via St. Louis Fed (housing starts); U.S. Agriculture Department (volume); Daowei Zhang, Auburn University School of Forestry & Wildlife Sciences, 2018 prices TimberMart-South (Southern timber prices)
Most Southern woodland owners are stuck with whatever the nearest mill is paying. Hauling logs cross-country chasing better prices isn’t an option. It doesn’t take many tree trunks to fill a truck to its 80,000-pound limit on interstate highways. Loggers, paid for each ton they cut and deliver to the mill, are reluctant to make all-day trips.
Some timber harvests are barely worth the effort after the expense of logging, hauling, taxes and replanting. In some areas, there is hardly any margin for the imperfect pines that are pulped for paper and particleboard.
Waiting for better prices carries its own risks, because after a certain age, trees, like people, become more susceptible to disease. Hurricanes can lay down entire tracts. The Southern pine beetle can alter financial plans in days.
Hernando de Soto searched the South for gold in the 16th century but what he found was mostly trees, a primeval forest of longleaf pine that stretched from what’s now southern Virginia to northern Florida and west into Texas.
The British navy gobbled up the colonies’ longleaf for its rot-resistant wood and gummy sap, from which turpentine and pitch were made. In the decades following the Civil War, the pine lands were logged nearly to oblivion. Vast swaths of forestland also were cleared to plant tobacco and cotton.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image004.jpg
Pine logs move along as a computer decides what size lumber they will become. PHOTO: KAREN E. SEGRAVE FOR THE WALL STREET JOURNAL
In the 1950s, the U.S. Department of Agriculture started dangling forestation incentives to stem erosion and prop up crop prices. At the depths of the 1980s farm crisis, when prices for agricultural commodities plunged, the Reagan administration launched the Conservation Reserve Program. Starting in 1986, it promised farmers annual payments of about $30 to $50 for each acre they planted with trees or grasses.
Many seized the offer. By 1994, more than 2.2 million acres of farmland in the South had been converted to pine plantation, much of it in Mississippi, Alabama and Georgia. Other federal forestation programs added about 2.5 million acres more, according to Auburn’s Mr. Zhang.
Meanwhile, timber was gaining popularity as an investment idea. People reasoned that trees would grow, and thus gain value, no matter what the stock market did. Investors large and small snapped up forestland that big paper companies put on the market to take advantage of the interest. Researchers reported in 1998 that residual fertilizer in the soil of former farms was helping trees grow faster.
A crush of maturing trees arrived just as U.S. housing markets collapsed in 2007 and 2008, creating a supply imbalance that in some places has never ended. Even with increased demand from the housing recovery, there remain about 25 years’ worth of softwood supply in the Southeast, said Brooks Mendell, chief executive of Forisk Consulting, which advises timber investors.
In parts of Mississippi and Alabama, the glut is even worse. “It’s unclear we’ll ever have timber prices like we did 10 or 20 years ago,” Mr. Mendell said.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image005.jpg
Logs are piled up to await processing at a PotlatchDeltic mill in Arkansas. PHOTO: KAREN E. SEGRAVE FOR THE WALL STREET JOURNAL
Southern mill owners—who buy logs from landowners and resell them as poles, lumber and pulp—anticipate wide margins for years because their raw material is so cheap. Billions of dollars of new saw mills and mill expansions have been announced by the likes of Georgia-Pacific and Canada’s Canfor Corp. Lumber is more practical than logs to haul long distances to stronger markets.
The arbitrage inspired last year’s merger of Deltic Timber Corp. and Potlatch Corp. Deltic’s three Arkansas mills offered profits amid depressed prices for Potlatch’s Southern timber. The combined company quickly added a second shift to a mill in Ola, Ark., and a more efficient kiln for drying wood at another mill.
More mills could help timber prices, but building one of today’s modern computerized mills, and finding the skilled labor to run it, is a complex task. “Can they install a mill in a rural town in Mississippi and be able to go hire a hundred workers who want to work in a saw mill?” asked PotlatchDeltic Chief Executive Michael Covey at an investor conference in New York this summer. “It’s going to take a few years for those Southern log prices to tip back up.”
In the woods behind a subdivision in suburban Birmingham, Ala., this July, loggers downed all but the most aesthetically pleasing trees on George Lutz’s 60 acres. He had plunked down some of his retirement savings to buy the property after the housing crash a decade ago and planned to develop residential lots. He was counting on the timber to recoup much more of his cost.
“If it wasn’t my retirement, I probably wouldn’t cut,” he said.
The 65-year-old enlisted Rick Nelms, an Alabama consultant and procurement forester, to squeeze as much as possible from the harvest. Mr. Nelms is what is known as a timber cruiser, able to move through the woods and size up trees and estimate their value at a glance. He used to procure timber for a big paper company but now drives around Alabama and Mississippi advising an array of dentists, retirees and heirs on land deals and timber sales.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image006.jpg
Forestry consultant Rick Nelms oversees a timber harvest on a tract in Alabama. PHOTO: BOB MILLER FOR THE WALL STREET JOURNAL
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image007.jpg
Mr. Nelms examines a log. PHOTO: BOB MILLER FOR THE WALL STREET JOURNAL
On Mr. Lutz’s property, he watched the operator of a machine called a knuckleboom-crane yank trunks through a “delimber” to shave off the branches.
Mr. Nelms waved to the operator and shouted, “That’s a pole.”
The man in the crane looked down at the thick log he was about to lay on a pile of trunks destined for a mill that would saw them into lumber. It’s bent, he said.
Mr. Nelms assured the operator the log would straighten out on the truck under the weight of the other big logs destined to become utility poles. The crane operator set the trunk aside.
It was worth the trouble to sort the trees carefully. A run-of-the-mill power pole could fetch about $50 a ton at the mill, Mr. Nelms said, and logs big enough for larger transmission poles could be worth as much as $130 a ton delivered. Saw logs, on the other hand, got only about $20 a ton.
Nearby, a truck that was headed for a pulp mill 40 miles away pulled two trailers stacked with about 150 tree trunks, each about 40 feet long and too skinny, knotty or crooked to make poles or lumber. Mr. Lutz would pocket just $3 a ton after expenses, amounting to around $75 for the whole load, according to Mr. Nelms.
file:///C:\Users\jwaters\AppData\Local\Temp\msohtmlclip1\01\clip_image008.jpg
Pine logs arrive at an Arkansas mill. Owners of Southern forests often are stuck with whatever a nearby mill is paying for timber because it isn’t feasible to haul logs long distances. PHOTO: KAREN E. SEGRAVE FOR THE WALL STREET JOURNAL
Before the housing crash, he could have expected three to five times that much, but since then, many more trees in Southern forests have grown to maturity.
Mr. Lutz’s trees were sorted into seven product types, including saw logs. It was a natural stand, so there was plenty of hardwood, which was a plus. Long a nuisance for plantation growers because they compete with pine for sunlight and nutrients, deciduous trees fetch much better prices these days. A river system that flows to Alabama’s Mobile Bay offers a way to ship the hardwood to overseas buyers.
Over toward Mississippi, outside of Reform, Ala., George Ballard harvested 100 acres where a mix of trees had sprouted naturally after an earlier clear-cut. The hardwood here was a blessing, returning $26 a ton instead of the $4 to $12 a ton his pine trees fetched after expenses, depending on what product they were destined to become.
The economics are much worse for 1,000 acres he owns across the road. Mr. Ballard, 62, clear-cut both tracts after he bought them in 1987. Unlike the smaller parcel that he left to grow back naturally, he spent more than $200,000 planting the larger property with rows of pine. Some lucrative sales had prompted him to go all-in replanting there and on other land he owned.
“I got $6,000 an acre and we thought, ‘W
Good points, I think my housing point was meant to say that housing now compared
to the 90's, early 2000's is not good. I am not sure timber will ever recover unless we find some new uses for pine besides lumber, the pellets for fuel sounded promising but it doesn't seem to be catching on much.
to the 90's, early 2000's is not good. I am not sure timber will ever recover unless we find some new uses for pine besides lumber, the pellets for fuel sounded promising but it doesn't seem to be catching on much.
I planted black walnut, chestnut oaks and a little bit of sawtooth oaks 14 years ago in what used to be pasture land. I could still run over most of the saplings with a bush hog and cut them down. I just hated a damn pine tree. I'll never live to harvest it or see a return but somebody will have a nice little forrest one day.
Sorry there sport. Your lack of detail on what you need limits a response. Do you have cut-over, are you going to clear cut, etc. What's your decision about? What is it you are trying to do?
prescribed burning is a good management tool or a prep tool coupled with spraying.
prescribed burning is a good management tool or a prep tool coupled with spraying.
I just did all of the IT infrastructure in a new pellet plant, and they have sold out contracts for over a year out. It's all going to Europe, though. I think the big pellet plant in Aliceville, AL is not running at full capacity, though. The one I did is run by the Mohegan tribe of Connecticut. It's down south, though. They have 4 pellet plants down here.
I received an email from Land Bank. They are giving away saplings soon, you'll have to look it up. The NW Miss Landbank is in Senatobia. Not sure if this is going on at all branches. Also doubt that they are giving away enough to set out 50 acres but not sure how many you wanted.
i was looking for a recent thread about the subject...couldn’t be more clear.
wasnt asking for anyone’s opinion...sport.
curious why it doesn't seem to have impacted consumer prices much. Or maybe it has and I'm not buying enough wood to notice. I do some cabinet making, and hardwood prices seem to have continued to rise. Sawmills just ballooning profit margins?
About 20 something years ago my Dad let his family talk him into clear-cutting our land with theirs and mass planting pines.
I urged him to replant in hardwoods but I was shouted down by relatives talking about all that pine money. When they asked me why I said to not plant pine I told them that if everyone was doing it, there would be a glutton of pines when theirs matured and they would not get the money. I even offered to pay for saplings on our small part for walnut or whatever would be the best hardwood.
Drove down up there during my visit last May and there are a ton of pines and laments from the kids my age about their price a and the lack of hardwoods. I moved on.
Just to be clear to anyone who doesn't realize it. Calling someone "Sport" is not generally taken as a sign of respect or friendship these days.
This actually looks promising, does anyone know what these pellet plants pay
for pine per ton?
https://www.wtva.com/content/state/...200M-investment-in-Mississippi-504159991.html
for pine per ton?
https://www.wtva.com/content/state/...200M-investment-in-Mississippi-504159991.html
This will likely slowly correct itself. Those who have to sell now are doing so and eventually the excess supply the mills are enjoying will lessen and prices will rise.
I would also think more mills being built would eventually generate more supply of lumber, which should reduce the prices to end buyers. That said, I know barely enough about this to have an opinion, much less a good one.
I chose to stay away from timber investing other than dabbling a bit with family land because I always felt like the dumbest guy in the room when discussing timber management with professionals. Felt like a low return proposition.
I would also think more mills being built would eventually generate more supply of lumber, which should reduce the prices to end buyers. That said, I know barely enough about this to have an opinion, much less a good one.
I chose to stay away from timber investing other than dabbling a bit with family land because I always felt like the dumbest guy in the room when discussing timber management with professionals. Felt like a low return proposition.
Don't know what they are paying per ton. I bought some Enviva stock a little over 2 years ago. I was doing some market research on green stocks and this is one of the ones that caught my eye. Price per share has only gone up $3 but they're paying 8.45% dividend.Originally their plan was to use all the leftovers from timber cutting, tops, limbs etc. However since timber prices are depressed and since Enviva has signed a lot of long term contracts in Europe they can purchase pulp timber and still hit a healthy profit.
FYI, there is a search feature on this board. Searching for "timber" turned up the threads you were probably looking for.
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