Question
My grandmother has decided to have a portion of her timber cut. She has consulted with a timber consultant about finding a reputable logger and overseeing the operation. He wants 10% off the top before taxes for his services. Seems to me he might be trying to rip her off. I think she could take sealed bids on the job herself and save a lot of money. Does anyone have advice?
Forum Responses
Some of the big paper mills (Mead, International Paper, etc.) have foresters that will work for free as long as that mill has first refusal on the wood. You might check that out.
I have seen some real ugly logging jobs done that were overseen by the "10% consultants".
I recently did this with some of my woods. The highest bid was $27,000 and lowest $12,000. Whatever you do, get lots of bids.
If you are going to get the state to mark your timber, there is a long waiting list. Some states don't allow their foresters to mark timber.
If you think you can handle a sale on your own, have a consultant mark your wood and give an inventory and appraisal. Then all you have to do is the legwork. Contacts, inspections, showing the timber, advertising, taking bids.
By all means, get referrals from whoever is doing any work. Check them out! Very important.
You might want to check market conditions in your area, as well. Markets may have gotten a little soft, and now would not be the best time to sell.
I am a state forester and we do recommend forestry consultants very highly.
Next, procurement foresters make a living buying timber. They do it on a daily basis. If you are unfamiliar with this process, you should seek help. Properly written contracts are critical to the success of the sale, both from the buyer's and seller's perspective.
Finally, be sure of the tax implications. Establish the basis if it has not been done. A knowledgeable timber tax attorney or CPA may be your best friend in this deal and save you thousands of dollars in taxes. I made my living for a number of years buying timber. I now work for a consulting firm.
Just keep in mind that the highest price for your timber is not always the best deal. The individuals working on your property should be the best available. Check references. There is considerable difference between one logger and the next. Only deal with the best.
Contracts rarely mean anything, because they are usually arbitrary to the buyer and most will run you and your wood lot ragged.
Here's what I would do: Tell a professional forester that you want a "light commercial cut" of 2-5 financially mature trees/acre that may make the veneer grade. Then get a good "independent" contract logger to cut the marked trees only, without damaging the residual stand. Then get a buyer/buyers from a veneer mill to look at the logs once the trees are down and out. Don't get a middleman buyer--you will be taken. Sell the sawlogs to a sawmill that will treat you right. Private wood lot owners rarely get a fair shake, trust me.
You could pay your forester and logger based on the gross percentage.
If you do it this way, you will still have a valuable forest that can be cut again in 10 years and make twice the money. This isn't cut and dried by any means, so learn what you can before you get $ signs in your eyes, or before your wood lot is pounded into oblivion.
I have been in the wood business well over 20 years. I have seen the bad, but the bad is the exception. For every shyster there are 100 hardworking loggers, foresters and mill hands that are honest individuals that care about their customers and industry.
Educate yourself, talk to references and hire a professional that cares about our industry and its sustainability.
The most important thing to do is to carefully interview independent, fully qualified foresters, check with their previous clients, and then select the one you feel best about working with. Explain your objectives as to the future of the woods.
How a wood lot looks during "sustainable forestry" practice depends on the size of the wood lot, the species of the trees, the soundness of the trees, the products the trees are being grown for, etc. Managing 1000 acres produces a different look than managing 10.
A simple example may be SYP in the Southeast. Trees are planted or naturally seeded on prepared ground, perhaps thinned in 3 years and seed trees removed. The trees may be thinned again in several years for pulpwood, thinned again later for chip and saw, thinned again later yet for saw timber and finally clear cut for poles and veneer. Then replanted for another cycle. Trees appearing in the middle of this cycle are canopied over and won't grow, so it looks like the land is just being used up.
It isn't and that is why the person managing the property needs to have a forestry education, regardless of where he gets it. It's also why the person criticizing the farming techniques should understand forestry and the goal of the owner.
Is a clear cut a rape or did the forest reach its merchantable maturity? Is the property being managed for fiber or looks? In a nutshell, hire a good consultant, create a management plan and follow the recommendations.
Forestry is a very simple yet diverse concept that in my mind is a three way co-operation between forester, logger and landowner.
As we know, forests are generally very resilient in most climates, except for semi-arid regions. The Scandinavian countries saw huge clear cuts when it was first settled, but is now intensively managed sterile forests. North Americans have largely learned from these countries most of their Silvacultural practices of today. There are many valid reasons to cut that tree, but there are just as many equally valid reasons to leave it standing. So in view of that, there must be an enforced compromise to get the most quality roundwood out of our forests in the shortest period of time, while considering wildlife, recreation and water quality without damaging the residual stand. It just comes down to a hands-on ethic by those who really care in the first place, as opposed to the "cut and run" ethic that largely still prevails.
Comment from contributor S:
Do not put down all timber consultants. That would be like saying one bad apple spoils the whole barrel. I am a timberbroker, I have done this for over 17 years and I do not believe in ripping off the land owner. I work for the land owners not the buyers. Buyers will try to get your trees as cheap as they can and if the land owner does not know the real value of their standing timber, yes they will get ripped off by the timber buyer.
