selling timber

[craigb]

I am supposed to meet a timber buyer on my property this coming weekend. I called every buyer listed in the phone books and this is the only company that said they would selective cut my lot. I own 45 acres in virginia that i plan to move to soon. I do not want to clear cut but I do have a lot of wooded areas that could loose a lot of trees without any problems and the rest would probably benefit from the thinning. Can anyone offer any advice, or questions that I should ask before signing any contract. I am slightly nervous because I will not be able to observe the day to day operation. I live 5 hrs away from my property and can only get there on the weekends. Any horror stories out there?

 

[Anonymous Poster]

Craig,
Before signing any contracts, I would advise you to talk with a consulting forester.

 

[gordon]

WORDS OF WISDOM DON'T SIGN ANYTHING WITHOUT CONSULTING A FORESTER FIRST. Now with that said I could write a book on horror stories. Not saying that the company you called is not a good company but alot of firms will sub out their work and depending on how the contract is written is how or what you will end up with.

I've seen many properties Hi graded and what you end up with is not a clear cut plot but a bunch of junk wood left standing. The end result the cutters and the buyer made out like fat cats and the property owner was left with a mess and not nearly as much money as he could have or should have made.

Write into the contract as many conditions as you see fit because if you don't you will end up with the short end of the stick so to speak. The state of VA has a very good forestery division here is a link take some time on that website also click on the SAMPLE CONTRACT on that page. http://www.fw.vt.edu/forestupdate/wwwmain.htmlOnce this page comes up go to the lower right and click on the red VA forestry emblem then click on selling timber when the next page comes up hope this isn't too confusing. Thats where the sample contract is and alot of other uesful information.

Don't jump into signing a contract without having a forester come out to your property first---thats the bottom line. I could go on for hours on this. But if you prepare yourself in advance you will come out on the good end. Also you might want to consider timber taxes take alittle time to read up on that subject as well. If you have any other questions once you do some reading on the above site feel free to ask I'll help to steer you in the right direction if I can. ----Don't let the timber buyer steer you at all its your property and anything thats not in writing is nothing!!!!
Gordon

<P ID="edit"><FONT SIZE=-1>Edited by gordon on 9/11/00 09:24 PM.</FONT></P>

 

[richh]

DIDTOS to Gordon's post. Some where on this board there are more horror stories then you want to read. Be more than slightly nervous!!!!!
Rich

 

[Anonymous Poster]

Craig,
When someone offers to "selectively" cut timber on your property, that should be cause for you to go to DEFCON 1. Gordon's post mentions this as Hi-grading. It happens and I'd hate to see you witness to it. Your state conservation department should be able to provide you with a list of consulting foresters in your area. Another point I'd like to touch on is property ownership. Make absolutely certain you know (along with your neighbors) where the property boundaries are. By the looks of it Gordon, if not other readers, probably
has some interesting stories to tell about timber trespass. Lastly, ditto what Gordon wrote.......get it all in writing.

 

[gordon]

I like that DEFCON 1 very good point I didn't even go into the boundries or the buffer areas, landing zones, cleanup, skidder trails, any streams that have to be crossed, culverts added, cutting of unmarked trees and how much of a fine the buyer must pay, how payment is to be made and last but not least how is the board foot count going to be done.
Consult a forester and then get it in writing remember that it takes alot longer for a tree to grow back than a tomato plant so be sure on whats going to be cut and what market value of the timber is going to be before you sign.

But if you guys and gals want me to bore you with a page on each of the above I sure could.----tread lightly----
Gordon

 

[jyoutz]

Craig, I am a professional forester, however nowhere near your part of the country. BUT DO NOT DO ANYTHING WITH YOUR TIMBER WITHOUT CONSULTING A FORESTER. The first step is to contact your state forestry department for advice and maybe referral to a consultant who will help you to formulate plans, assess the stand condition and guide you in implementing practices. I spent 9+ years with my state forestry dept. advising landowners and I have never seen a timber company or logger prepared contract that had the landowner's best interests in mind. As a state forester, I would work with the landowner to assure that timber selection and harvesting was beneficial to the stand. I have been working for the federal government for the last 8 years, so I am out of touch with private lands forestry practices, but I doubt that much has changed. If you would like another referral to forestry assistance in your area, try www.safnet.org (this is the national website of the Society of American Foresters. You can find plenty of links from that site). I don't by any means want to discourage you from beneficial management practices, because you can really improve the future growth and vigor of your forest through management. I just want to affirm that forestry is a science, and practices require careful analysis and planning.

 

[Anonymous Poster]

Here's a excellent example of what can happen - I am on the Board of Directors of a Shooting Facility on Northern Neck of Virginia, 188 acres. We were approached by a timber company wanting to purchase popular on our property. He made an offer in the area of $30,000. We contacted a forester who drew up specifications and marked tree to be harvested. We had included that the buyer would retrun the road to its orginial condition and had damages for unmarked trees taken. He soliciated bids, high bid was in the neighborhood of $120,000. Big difference, and the forester definitely was working for us and made himself good money in the process. I now live in Louisa County with heavy timber going on, I have a couple of acres that I wanted cleared, some good walnut and popular but I am told not enough for mobilization of equipment, thus, not much interest and dollars being offered. Waiting for other timbering in my area.

 

[Richard]

We are in last days of having our farm "selectively" cut. Though it might be "cut" selectively, they are destroying half of what trees should be left by running over them, using them as levers to change direction as they drag fallen trees. They have *specifically* in their contract that they will clean up their mess daily. Though it's clear now, I've had to dog them AND (this one really digs me) they left one of those 6 foot tall tires that they changed on their skidder in a scrap woodpile for us to burn. /w3tcompact/icons/mad.gif I couldn't believe their cavalier attitude about trashing someone elses land. "Just burn it" he said. I just so happened that I have been lurking around where they are working and feel free to look UNDER things. this tire was pretty well hidden, had I not been on the creek side of the pile, I would have never noticed, they definately took a (small) effort to hide it. I kinda wanted to say something about him copulating himself!!?? /w3tcompact/icons/wink.gif

My personal land (surrounded completely by the farm) isn't part of the deal. I told them they could have my trees AS LONG as they took their time and were careful not to demolish the remaining trees. He essentially said, "If you want me to be careful, that will take too much time and I have no interest"

I'll be happy when they are done AND gone.

 

[Richard]

by the way, regarding forrester, there was a tree buying dude that had a "final offer" of $70,000 for the timber. Pop's and Uncle in laws hired forrester for 10%. Final offer dude was FURIOUS that they would't listen to him...

Auction price $171,000
Forrester 17,100

Net to elders $153,900

the "final offer" dude didn't show up for the auction, bummer.....could have had some fun maybe?

 

[dmccarty]

I'll REPEAT what has already been said, GET YOURSELF A FORESTER! NOW NOW NOW!

I just timbered my land, I talked with two different forester's and ended up using one that had a good reputation with my wife's family. Make sure that your get a good forester and that he is working for you. One company I talked with I did not feel would represent me.

What we did was have a marked tree close bid sale. The forester cruised our property and marked all the trees that had value. This may suprise you on what is valuable but in my area of NC the money is in pine trees. Hardwoods are not going to return as much as pine. In NC there is a 1-800 number that provides an average price on timber by NC region in the prior quarter. Hopefully VA has a similar service.

BTW, the going rate of a timber cruise seems to be $500 in my area. Since I used the agent/forester to sell the property he took his pay as a percentage of the sale. I've heard some people getting as low as 5% and up to 10% for the foresters fee. My forester had to drive in a good 90 minutes so I paid him more as a percentage. My father in law paid less since he was closer.

The trees are painted, DBH which is about 4-5 feet off the ground and on the stump. This is so YOU can see if the trees that have been taken are the ones that have been bought. With the timber cruised and painted you can also get a feel for what the land will look like after the cutting is done.

Our agent solicited closed bids on the timber. Since the timber was cruised we had an itemized count of tree type, size, and board feet. Some bids were mailed to our forrester and the rest were handed in at the time of sale. The bids were opened and we took the high bid. Did all of this on the tailgate of a pickup. We then had a closing a month or so later with a proper contract protecting our interests.

FWIW, I think contracts are only worth what you are willing to spend to inforce them...... They are not a sure bet but are better than nothing by a long shot.

Even though this was a selective cut and only the marked trees were taken many more trees had to be cut down as part of the operation. These were trees from saplings to 12 inch trees. They will need a place to deck the timber and that will leave a mess as well. My land and road pretty much held up. The road did real well until the last day of the timber operation. We had had three or four days of rain and the ground finally got saturated and on the last day the graval that was above grade was pushed down. Not a big deal . One place on the property was wet and the skidder bottomed out. Not a big deal since we are building on that lot and can fix it easily.

But we are left with lots of downed tree tops, branches, etc. I don't even want to talk about stumps. Where the loading deck was placed has lots of wood that has to be taken care of as well. I have enough firewood to last for years.

I have thought quite abit about the timber operation and my best opinion is that it is what it is. I don't think the loggers did a bad job, other than leaving some trash near the deck machine. Timbering is just a messy operation. I think we got the best price we could get but you also have to factor in the cost of clean up.

Taxes. Timber taxes are complicated. I just bought the land this year and timbered this year. I'm told I don't owe any taxes because of this. I'm not convinced. I've read alot of the tax code but for my situation there is a great deal of subjectiveness. There is a web site that has excerpts from a timber tax law textbook. The authors were amoung the group of people who wrote the tax law. They say right up front that timber tax law is wishy washy. Having said that, you need to figure out if you are timbering as a buisness, farmer, just you, etc. They all have tax implications.

Timbering ain't simple!

We did not timber about 1/3 of our land for various reasons. One we were getting enough money to cover our purchase of the land, clearing what we wanted for pasture, and for asthetic reasons. The whole process is a compromise and a balancing act. But I think we did it right. The only thing I would have done is have my forester sign a contract stating that he was MY agent and working in my best interest. Very much like one can do in the real estate business. Having said that, I'm not unhappy with my forester, he did a good job. He did what he said he would do and we paid him what we said we would pay him. I don't think there is anything I would do differently and I think things worked the way they were supposed to.

Its still not a fun process if you really like the way your land looked prior to timbering.....

Hope this helps....
Dan McCarty

 

[craigb]

Thank all of you for the excellent information. I plan on placing some phone calls tomorrow to hopefully get in touch with the local state conservation office and some forestry consultants. I have labored over this decision for at least two years but now know that I have not done enough research. Thanks again for your thoughts and advice. A consultant is definately an immediate step.

 

[jyoutz]

Dan, just a quick observation to make you feel better. I have never seen a timber management project that was pretty immediately after completion, but I've also never seen a timber stand (that was properly managed) that didn't look nicer a few years after the activities. Once your "leave trees" expand their crowns, and the grasses and other herbs respond to increased light, your stand will be much nicer than before the treatments (and in better condition for long-term growth).

 

[TomG]

I think that a 'selective cut' and 'cleaning up a wood lot' are different ideas. The selective cuts I've seen around here are a mess, and I think that's just the way it is for a cut to have much economic value. As others noted, the question is how do the trucks get in, how are the logs skidded etc?

I don't think I'd want to move to a place that had just been selectively cut. Such land around here isn't worth much on the market, and for obvious reasons.

I believe there is still a guy around here that skids with horses, and specializes in your type of operation. The idea is; thin things out a bit, take a bit of time, make a few bucks and don't leave much of a mess. That can be done with horses, and if it's not a 'profit maximizing' corporation. The guy doesn't have a logging company and wouldn't be found in the phone book. Maybe some of you soon-to-be neighbours know of such a person in your area.

Another possibility: A friend of my wife just had some trees taken down at her cottage. Her friend is from the city and was surprised that the cost was $350--in the city it would be more for just one tree. I guess the guy knows he can sell the logs and is just charging her just enough to make it worth while.

I think the problems is with the idea of 'logging the lot.' Logging has to do with making money, and that's the business of logging companies. Making money from timber really isn't consistent with leaving a lot looking nice.

If the idea is logging, then a logging company will do that job for you. If the managing the lot is the idea, than maybe another type of company would do the work better. Oh, I've heard people around say that selective cuts are worse at leaving messes than clear cuts.

 

[dmccarty]

There is a national organization of horse loggers. I believe there are a few horse loggers in VA so this might be another option. I found the national organization by doing a web search but I can't find a bookmark for its address.

The company that logged my land had 3 skidder/cutters, a decking machine and numerous semi's hauling off the timber. The skidders and decking machine had to have cost 300K-500K. I was talking with the foreman about the cutting teeth on the cutters. Depending on the timberstand, hard or soft wood, the teeth had to be replace every 40 hours or so and it seems like it ran around $500 for the teeth. They could use carbide teeth but they were 2-3 times more expensive and if they hit a rock they were shot. The skidders easily could have run over my full size pickup truck and not even have noticed. The cutters could got a tree, zip, that quick, lean the tree back AND MOVE THE TREE to where they wanted to drop it! I saw them move a 20 inch oak tree. But just because they can move the tree doesn't mean they can drop it perfectly and that is were other trees get knocked down.

Having this kind of capital tied up means you have to keep your machines working. So the loggers want to get in and get out. Time is money.

Even though the logger had lots of capital invested in the machines, I'm not sure that a horse logger and pay you as much as a mechanical operation. They might not have the overhead but it is going to take them much longer to timber.

The timber market fluctuates. A standard contract in NC gives the timber buyer up to two years to harvest the trees. I was lucky to time my sale to get the best dollar and get it cut quickly. But the company did wait a month or so to maximize their profit. I also know someone who sold timber and the company never harvested. After the contract expired they could sell the timber again.

Given the market conditions, a horse timber company might have a more difficult time price wise just because it takes them longer to harvest. Just my guess....

A selective cut is going to leave lots of cleanup. You can have the timber company to some cleanup but that costs you money during the timber sale. So balance what you think you can cleanup yourself with what it will cost to have done.

A good selective cut is going to look like heck for a couple of years but it will look good as time passes. I have looked at some places that were selectively timbered a few years ago and you really have to look to tell that it was timbered.

I have a very good quality road going into my property. It had not been maintained and saplings had taken over most of the road and the gravel was hidden by tall grass. I cut down the saplings and by the time the loggers were done there was not a blade of grass in the road. Well, three months after they left I need to mow the road! Saplings are sprouting up in the cleared areas and back in my road!

My land has only done a few things since time begain, grow rocks, trees, wildlife and make moonshine. It has never been farmed. The last timber operation was done 60-70 years ago. The only trace left from it is the rutted logging road that is visible in a few places.

Hope this helps...

 

[jyoutz]

Tom, Selective harvesting is actually short terminology for one of two uneven-aged management forestry systems (single tree or group selection). In either case, the goals are: 1) to provide regular periodic harvest, 2) to upgrade stand health and quality and 3) to insure regular periodic regeneration of new trees. This is done by leaving the BEST QUALITY TREES of each age class, while thinning the stand to a desirable density (what is desirable depends upon the biology of the forest species and owner's objectives). If these principles are the goals of the harvest and the implementation is well administered, then the stand should be more attractive and in much better condition post harvest. Selective harvesting has sometimes gotten a bad name because of either poor logging practices and administration or misunderstanding of what the forestry goals are. (REMOVING THE BEST QUALITY TREES IN THE STAND IS CALLED HIGH-GRADING -NOT SELECTIVE HARVESTING-AND THIS IS NOT SCIENTIFIC FORESTRY. IN THE WEST WE CALL THIS SAWMILL FORESTRY, AND IT IS NOT DIRECTED BY A PROFESSIONAL FORESTER, USUALLY BY A QUICK BUCK TYPE OF OPERATOR.

 

[TomG]

Thanks for the terminology. I agree, and it's always good to hear your informed comments (professional I believe) on the subject. I think you reinforced the point I hope I made. It's a real good idea to clarify goals before signing a contract. If the goal is to make money, that's one thing. Managing the lot is another, and management is a desirable goal irrespective of the money.

Around here, there is quite a bit of public forestland that isn't really managed. The ground is full of decaying wood and the trees are in poor condition. As I understand, such forests are disease and fire prone, and don't make particularly good wildlife habitat. It's also not very pretty. Managing a lot is a real good idea.

I think a risk is having a logging company thinking in terms of one goal and the owner thinking of another. Contracts establish legal frameworks and often serve to confuse, rather than clarify, communications. If the goals are different, then it's a potential disaster in the making, and one the owner has to live with for years. As somebody noted, it seems like a good idea to have a forester negotiate and supervise the contract.

One possible difference between selective cuts here in Northern Ontario and the U.S. West is the bush. I grew up in Colorado, and when I started living in the east I was surprised to find that you can't walk in the woods--you 'bush crash.' Some bush you really can't get through at all on foot. To take any logs out, yards and skidding trails have to be made. I think any sort of cutting here makes a bigger mess and needs more clear up than the forests I remember in Colorado. However, as noted, the alder, poplar and birch are back before too long. There are, of course, quick buck operators here as well.

I forget whether it was you who made the comment that timber cut around Tahoe has to taken out by helicopter. Skidding does make a mess and does damage no matter how it's done.

 

[craigb]

Thanks to all the good advice and interesting reading. I am meeting the buyer this sat morning but I stressed to him that no contract would be signed. I also got ahold of the state dept of forestry and the local forester is meeting me the following monday morning to look over the property and discuss options. He told me he will give me a list of consultants but that he is not allowed to discuss timber prices. Will keep the board updated after the two meetings. One resource I have been reading is "Independent Sawmill & Woodlot Management". They discuss all aspects of ownership, measurement, selling, buying, and harvesting. I also enjoyed the issue that covered using horses to skid timber. They have a website at www.sawmillmag.com , excellent magazine.

 

[jyoutz]

Good insights, and I agree Tom.

 

[Rowski]

I've learned a lot new termnolgy and info about logging, thanks. You might want to talk to other people who have used the forester and loggers you might be considering. Also go and take a look at some jobs in progress and some that are finished. Best of luck.

Derek