Foresters give timber owners insight into special pricing opportunities

By Jim Griffith
Registered Forester #1616

You planted your trees 28 years ago. During that time you have thinned your timber, plowed firebreaks, conducted prescribed burns and maintained roads and boundaries. According to the management plan your forester prepared years ago, your trees are nearing the end of their economic life, and a final harvest is projected for 2009, just two years away. Now you need to start thinking about how you will market your timber.

You may watch and study the lumber and paper market prices. You may subscribe to Timber Mart-South or some other stumpage price index report. You may religiously study the prices published in the Georgia Farm Bureau News. All of this is good, but I suggest you need an active forester in the market working for you.

Market prices do not move up and down along a perfect curve. There are periodic spikes and dips in the market from one mill to another. For example, I occasionally get a call from a mill or timber buyer delivering to a specific mill in need, desperately needing a special type product to keep the mill running. At these times of need, they are often willing to pay a premium price. If you have a product they need, for example pine sawlog trees, then you can take advantage of this spike in the market to maximize the return on your timber investment.

When you are within three years or so of your anticipated harvest, you should begin to closely watch the timber market for a spike in prices, or better yet, have your Georgia Farm Bureau forester watch for you. He is in touch with the timber buyers and fully aware of what is happening in your local market. This spike in prices is often a local increase on a specific timber product and not an across-the-industry market adjustment. Unless you are in the business you may not even be aware of the change in price you are about to miss out on.

I manage several timber properties that are nearing harvest time, and we are watching for just the right time to sell. These timber owners plan on selling in the next year or two and have no need to sell before then unless prices were to spike upward. It usually takes a forester in the market to help take advantage of such an opportunity.

This actually happened recently when we had a mill call with a specific need in a defined area. The mill was ready to pay more than we had seen in the market for quite some time. You usually need to be prepared to move quickly so as not waste an opportunity to profit from a specific need at a specific moment in time.

This is another example of why it is important to not only keep up with the timber industry overall, but to know your local timber market as well, in order to maximize your profits from the sell of your timber.

Jim Griffith is general manager of the Georgia Farm Bureau Timber & Real Estate Companies.
Georgia Farm Bureau News – March 2007

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