By Jim Griffith
Registered Forester #1616
I often receive calls from timber owners who are on the backside of a timber sale. My most recent caller requested prices for timber. In the course of the conversation, I learned the caller had already sold his timber and received payment.
It seems this timber owner had verbally agreed to sell his timber on a pay-as-cut basis for per ton prices. When it came time to settle, the compensation was by the cord which prompted the timber owner to call me to get information on converting cords to tons and market prices for various timber products. As I wrote in my column last month, the time to do your research is before you agree to a timber sale, not after! It is perfectly legal to sell timber by the load, ton, cord, or any other means by which you want to trade under a pay-as-cut sale. There is a requirement, however, that the timber buyer disclose a weight factor for the given measurement by which you decide to sell. This is only one reason you should always have your timber sale agreement in writing.
A verbal agreement leaves a confused seller open to negotiation at the completion of the sale. Negotiations should be done up front, defining the terms of the sale, creating a means for clear sailing during the cutting and stumpage settlement at the end of the cut. A confused and unknowledgeable timber owner is vulnerable to a switch and bait method of sales.
The timber owner who called me had agreed to sale his timber by the ton but now had scale tickets in pounds and a settlement statement for cords. And guess what? There is no standard conversion factor for pounds to cords. A cord is a standard of measure for 4-foot sticks of wood piled in a stack 4 feet high by 8 feet long. There is no given weight for this stack of wood that varies based on diameter of sticks and density of the wood. Over the years, those in the timber industry have agreed that it is the responsibility of the timber company to create their own conversion factors to establish a cord of wood from weight measurements. A cord has traditionally utilized different conversion factors depending on the species and product type.
Therefore, it is imperative one establishes a means of defining a cord in the event your buyer insists on using this form of measurement. I suggest you begin and end with the same measurement. Preferably this would be tons, since that tends to be the new universal measurement in the wood industry for measuring timber products. Sticking with one factor defined by a given weight, eliminates the need for conversion and thereby confusion to one or more of the parties involved. You may be considering the sale of timber. If you are, do yourself a favor and contact Georgia Farm Bureau for the assistance of a forester near you, and avoid the hassles of confusion in the end.
Jim Griffith is general manager of the GFB Real Estate and Timber Companies.
Georgia Farm Bureau News – June 2004