12"x12"x16' beams

[Ron Wenrich]

Well, I disagree with your assessment.  His first question on the subject was that he is charging 50¢ for dimension lumber and asked if he should charge more or less for a bigger piece of lumber.  Everyone agreed more was the way to go, since it takes bigger logs and the pieces are heavier.  Your rub seems to be that he didn't go enough.

Ivey is satisfied in making an $89 profit on a $55 investment.  If its a free market, then each producer can set the price.  If Ivey can produce at a lower cost than you, he can charge less and still make a better profit.

We don't know what prices are in his area.  50¢ for dimension lumber may be his local market price.  We do a little better, but not much.  If he charges too much, there might not only be no repeat business, there may be no business.

[Brad_S.]

What you say is true Ron, but I went back and read Ivey's original post upon joining the forum. His milling operation is a retirement career. His equipment is most likely paid for and there is probably a pension check covering basic expenses. Ivey can therefore afford to live on less because his old job essentially subsidized the new one. The new career is basically just to earn some spending money. I can't help but think that if Ivey had to support all his equipment and expenses off the sawmill, he would find that selling lumber that cheap cannot sustain a small sawmill business. I always value prices you post as a guideline but they are always at the lowest end of what I can afford to sell for. You make your profit in volume. These small mills most of us own can't generate the volume you can so we must be more savvy in our marketing and pricing. The fact that Ivey sells his lumber for even less than you worries me that he's basing his pricing on factors other than sound business analysis of his costs.
Ivey,
I'm sorry if I seem to be ragging on you here, that's not my intent. If you can sell your lumber for 50¢ and still live a comfortable life, more power to you. It's just that this is an example of a pricing structure that I see all too often by my own competitors who are subsidized by other income sources but fail to realize that fact to themselves. Guess it strikes a nerve here. No disrespect is intended and I hope no offense is taken, it's just an opportunity to have an open discussion on a problem plaguing some areas of the industry.

[Ron Wenrich]

No disrespect taken or given.  I think its as good of place as any to bring out pricing.

I see things in a little different light.  Market prices are not driven by the small time operator.  They are driven by much bigger players.  If you can't produce a comparable product to larger producers, then you will lose out in their market place.  That's how the free enterprise system works.

Our prices may seem to be on the lower end, but that's what the market in my area dictates.  It reflects stumpage, logging and milling prices.  If you can't get one of those in line with the market place, you won't be able to compete.  Our milling costs are half what I've seen posted on this board.  Should I not take advantage of that in the market place?  Shouldn't I pass that on to my customer?  Or should I take advantage of my customer to artificially inflate the local market price to protect other producers? 

The markup in this case was $465/Mbf from sawlog to product.  That's a pretty wide margin for someone to work in.  That doesn't seem to be way out of place.  What is the cost range you want to deal at?  It seems to me that you should be able to make a living wage at that rate.

I've been in the business for a long time.  I have seen small businesses that have flourished by picking up the crumbs of what us commercial guys don't want to deal with.  There's simply not enough volume to make it attractive to us.   That's the niche that small guys can fill.

I kind of look at this pricing thing as a difference between wholesale and retail.    Small businesses need to sell at retail to cover their increased overhead, while the larger mills can sell at wholesale.  As a customer, which one would you buy from given the quality to be the same?

[mike_van]

Kind of a side note on prices - Some 10 years ago a lumber yard not far from me was selling shiplap e. w. pine for .50 a sf. I used to tell people to go there when they asked me about shiplap. There was no way I would buy logs, mill into boards, dry it, plane it once, rip straight edges & shiplap for .50 sf.  At 1.00 sf it's still a lot of work for a one man show.  50 cents, I don't know how they did it. But, they're out of business now & I'm still here - 

[Frickman]

I have one of those small businesses Ron mentioned. Today I sold 2 x 4 x 16 foot tulip poplar and 1 x 10 x 10 foot tulip poplar for a little over $1.00 / board foot. Around 2 mbf in all. All for barn lumber, log run out of better, number 1 logs, but not prime logs. How can I charge so much? These are crumbs noone else wants. There are big, wholesale commercial mills all around me, and none of them do custom orders unless you're a friend of the owner. These mills send people my way, and I charge a dollar foot or more. They have a problem that needs solved, and I'm there go-to guy. Niche marketing.

For a 12 x 12 x 16 I'd charge a minimum of $1.50 / bf, maybe $2.00. We have all hardwoods, no softwoods, so that inflates the price some. It's a free country and a free market, and I don't have a gun at their head. They can pay my prices if they want, or walk away if they want. 80% pay.

[ARKANSAWYER]

  Ivey asked advice and got the answer he was a looking for.  He is charging more.  I could do it for his price all week long.  I sell SYP for $0.50 a bdft and have standing orders for weeks in advance.  His log cost is only about $0.22 cents a bdft and the 20 inch 16 ft long will produce close to 300 bdft.  He will be able to sell all the side wood and make some money on it as well.  SYP runs big an straight and there should not be any problem getting logs that would make the product.  One must remember the local market and how it moves very slowly.  I can not compete with the big box stores for 2x4x8 by price alone, But I can beat them on a 24 ft 2x4 every day of the week.  I only sell about 200 2x4's a week but they are better quality and at a price that makes me money.
  I am all for banning the small mill operations run by retired people and Amish who work for cash only and pay no taxes.  I am all for price regulation so that the Big Box stores can not sell cheaper then I can produce.  I am also reminded by the scars on my body that I fought for their rights and free trade as well as mine.

[Gilman]

Are these beams #2, #1 with wane, or no wane?

For those going to be pricing beams, there is a huge difference between the two. 

[scsmith42]

There has been some very thought provoking dialog on this post. 

I don't have anything to offer at this time, other than my thanks to Brad, Arky, Don, Ron, Frickman, and Haytrader for sharing their perspicacious insight.

Scott

[DanG]

Perspicacious?  How long did you plunder through the dictionary to come up with that one, Scott?   It's a good word, though.  It made your post rather perspicuous*.

*I found that one when I went to look up the other one.

[fencerowphil (Phil L.)]

Well,..
 
I guess this goes to show that erudition is not dead...

at least not in The South!    Very interesting comments and great information!

For another angle on the topic of 12by12s....

A local tree guy has some oversize pine in the 30-32" range on the butt. 
Green and fresh they would have been pushing a total of about 8 tons.   
Today, one of my forester friends said stumpage for Pine Sawlogs in my
area of GA is running $42 per ton, plus cut, load, hauling cost, so that puts
delivered logs from close loggers at about Ivey's prices:  $55/ton.  Because
these tree service logs are past prime, he suggested offering the tree guy half the stumpage price.
That would put me at 7 tons for partly dried logs which should cost around
$210 and yield  well over 2MBF.  That is from five logs which are 17'-6" length.
We swingers love logs like these (not to mention deals like these).
 
Time to pop the question.

With no market in mind,    what dimension boxed heart beam should I cut
out of these five logs?  (I will be cutting 2X6 and bigger out of the rest.)

Phil L.

[ARKANSAWYER]

  I would think that 16x16 would be good.  Or better yet list for sale some large timbers up to 20x20 and see what jumps out at you.  No matter what you cut them into they will want something else.  I can have (and offten do) 20 mbdft of lumber on the place and they will ask for the one size I do not have.

[deadeye]

i cut some 6x10  28 ft and 24 ft  charged 1.50 bdf .  white pine all of them

[Dave Shepard]

fencrowphil, if you want to leave a cant, try finding a bandmiller that does wide plank flooring. I know that when I want to make the wide stuff, over 20", I have to have a good, large log. Then I have to get the DanG thing on the mill and whittle all the small stuff off of the outside, producing a lot of narrow boards I don't really need. Or if it's a really big log, I have to square up two adjacent sides with the alaskan mill so it will fit on the mill. If I could buy 18"x18" or larger cants at a reasonable price, it would put my in a good position to crank out the kind of boards I am looking for and not have any of the hassle of dealing with the small stuff or the slabs.


Dave

[fencerowphil (Phil L.)]

Verrry Eenteresting!

Since I am using a 10" Peterson Winch Production Frame swingblade,  that big
cant is left as literally a "left over" in the center of the log.  At least that's the
way I must do it, if that cant or beam is to be bigger than 10-1/4 inches square.

If the beam is to be bigger than that (the blade capacity of the big Peterson), here is
the strategy:
   1.  Flat saw the top of the log down to the target top surface of the intended beam.
           This portion of the log will probably yield a 1X6 and several 2X6s, etc.
   2.  Flat saw the left side of the log, using deep vertical cuts.
   3.  Remove the guard and do deep vertical cuts to the right of the intended beam to
          yield flat sawn boards from that side.
   4. Do deep horizontal cuts from both the left and the right underneath said beam to
           release it.   ( Then move it, of course.)\
   5.  Finally, finish the lowest portion of the log flat sawing as was done with the top
           portion of the log.
As you have probably realized, the log stays in place - no turning.  The drawback is
that any stress in the log can be your undoing.   Corrective cuts may be necessary, so
you have to think of what dimension of lumber to pick to make the correction such as
a useable 2by which may vary in thickness (which won't cause much fussing), as opposed
to a badly irregular width (which would definitely require resawing to correct the problem).

This plan will permit a maximum beam size of 10-1/4" by 20-1/2", without turning the log.

So, ... when the swingers get into beams above 10" it takes a little cognition before ignition.
 
Phil L.

[scsmith42]

DanG:     I catually knew that one off of the top of my head, but confess that I had to pull the dictionary out to confirm the spelling 

Phil - when you're making large vertical cuts, does your sawhead tend to jump up and down a bit?  My WPF seems to do a little dancing on any vertical cut more than about 5".

Scott

[Ron Wenrich]

Very rarely will we put a log on the headblocks that doesn't have a good destination.  The only lumber that we have on hand is sidecuts from orders that didn't have a home and some species that there aren't ready markets available - sassafras, locust, and white pine.

We hold onto logs until we get at least 1 Mbf of marketable lumber, then we cut and move the lumber.  That way we have limited risk of not having what is needed or degrade in the sawn lumber. 

Then, there's some logs we don't even saw, we just sell them to someone else.  I haven't seen a cherry log in a couple of years, and only recently got into some walnut. 

[fencerowphil (Phil L.)]

Scott:    In a word... "uh-huh."
             But at least you are always only a hop, skip and a jump from being "done."   

Ron:      Have to key in on three words:
             Space.   I have no room for logs, (since all my lumber piles now use it up).
             Scale.   Compared to the commercial yard, the rate which I produce lumber is paltry.
             Hobby.   Sawing from me is my "Overgrown Hobby," so I constantly have to fight the
                           urge for equipment; more land; more buildings; and kilns (of various types ),
Oh, well, you get the picture!

"When I wish upon a star, 
  logs, then lumber...
  scattered far...."                                             Phil L.