The Timber Game – Do You Know The Players?

Making wise timber management and sales decisions starts with understanding the roles of the various industry players and how they fit into your planning. Here is a brief overview.

The Timber Buyers*

Mills buy raw timber products and turn them into lumber, paper, plywood, etc. Most mills have a specific product purchasing niche. Some mills employ personnel to purchase standing timber, others rely on wood dealers to bring the raw materials to them, and some do both.

Wood dealers are independent buyers who supply mills with raw materials. They purchase standing timber, then contract loggers for the cutting and hauling to the various mills.

Loggers do the actual harvesting. Some buy timber, but these days most are contractors that cut for mills or dealers, focusing on production and leaving the hassle of cruising timber, marketing, and negotiating to someone else.

Pinhookers are the mercenaries of the timber business and are famous (or infamous) for unsavory buying tactics. These speculators are known for “flipping” timber rights, meaning they purchase the rights cheaply, then resell them to another buyer at a much higher price. More about these guys here.

The Government

The Forest Service (North Carolina) and Forestry Commission (South Carolina) can provide technical assistance and basic management advice. They also provide some services (such as understory burning) that aren’t readily available from private contractors. They do not provide timber inventory, appraisal, or sales services.

The Representatives

Forestry Consultants represent you.
Timberland Advisors represents you.

Forestry consultants represent landowners, providing timber management, appraisal, and sales services. The consultant category is the one under which I fall. The consultant’s job is to represent the client’s interests, providing informed, objective opinions on values and management direction. As your representative, the consultant should (but some don’t) avoid any fee structure that conflicts with your profitability and should provide you with a full accounting of any money they earn while working for you—this means no hidden fees in services provided by outside contractors (reforestation, survey, etc.).

Studies have shown that forestry consultant administered sales result in considerably more money than do-it-yourself sales. You’ll pay a fee for the consultant’s services, but you’ll generate more net revenue, have greater returns in the future, and avoid the lingering doubts that you could’ve gotten more money, a better job, etc. See the study summary here in the 2016 edition of The Consultant: http://tinyurl.com/hy47nt2

Like any industry, the timber business has the good, the bad, the incompetent, and the truly despicable. It differs from most others in that it is one of most difficult to grasp without having years of experience dealing with the markets, land, and people in a particular region. Reading a few “How to Sell/Manage Your Timber” articles on an agricultural extension site or using one of the “do-it-yourself” online planners is not going to prepare you. Forest product demand and prices are volatile, and individual buyers offer vastly differing prices and quality of work.

*Note: In NC and SC, to use the term “forester” as a title and give forestry advice, one must have met the requirements (education, experience, and testing) set by the state(s) to obtain a license. By law, all consultants are foresters. Buyers may be foresters or not—there is no licensing process to work as a timber buyer. 

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Tim is a forester, real estate agent, and avid outdoorsman. When he is not managing clients’ woodland, you will find him hiking, trail running, reading, or woodworking. Motto: “Never get too comfortable–there is always room for improvement.”