Milling my own wood hoping to find buyer of 2-3 million bf of Red Alder per year

[RedAlderDude]

I've got 600 acres of remote ocean front land in BC that is loaded with 16 year old Red Alders.  I have plans to thin about 100 acres per year (about 200 trees thinned out per acre) starting in 2012.  I estimate between 400 and 500 big trees on the land at present (10" plus DBH).  I expect the average tree by 2012, will be about 12 to 15 inches DBH.  After thinning all 600 acres, my plan is to harvest 30 acres per year of 200 to 300 trees per acre of 18" plus inches DBH trees.  The gross numbers look very encouraging but being a commercial fisherman by trade I have a lot to learn.

My Plan is to buy a landing craft a 6 wheel drive, flat bed, boom truck that will carry about 10,000 bf of milled lumber and four portable mills as well as some kind of log skidder.  My plan at this stage is to send 8 to 10 guys into the woods with this equipment and have them mill right where they fall the trees.  If we can average 8000 bf per day we can produce 2 million bf in 200 days and then go to Hawaii for the rest of the year.

After talking to a big Mill owner and calculating my log value based on Scribner it seemed like I would be taking it in the shorts compared to the actual value of the wood if i mill it myself.

My questions are these:

 Am I being overly optimistic to believe that 10 guys can fall, limb and mill 8000 bf a day with portable ban saw mills?                 
 What are the cheapest most dependable mills that will do the job for me?
  Are there logger out there that are willing to work on a share of gross sales or does the owner have to pay by the hour?

If we can get just a buck a bf, I would expect that loggers and miller could make over $70,000 in 200 days.  Is this enough money to get good guys?

[Brad_S.]

80 views and no replies but I am dumb enough to wade in.
I don't know a thing about red alder but $1 per bdft. sure sounds like an optimistic price. To get that you need to sell your upper grades for well above that to compensate for selling the heart for near cost.
And expecting each mill to turn out 2k bdft a day is assuming few breakdowns.
Just my thoughts at first glance.

[paul case]

i dont know much either but i would also  assume something closer to 2000 bd ft per day on an automated  band mill with 2 men working it. pc

[Kansas]

There is one thing I have always noticed between loggers and sawyers. They each think the grass is greener on the other side of the fence. Being I'm on both sides of the fence, the grass isn't that green on either side.  I don't know anything about red alder, but be very careful of your figures. Realize that all that equipment costs a lot of money. Not knowing the area you are in, be careful about the idea that you can cut 200 days at the timber. That is, do you have the weather that will let you. Other questions are will you kiln dry it or sell it green? Do you have a ready market? There are a lot of hidden costs with sawmilling operations. I am not saying you should not do it. Just saying you might want to ease into it.

[mad murdock]

I'll throw my thoughts into the mix.  If you are looking at a somewhat remote operation, you are going to want to equip with the simplest, easiest to maintain equipment, since you won't be able to just have a UPS truck pull up to where you are at.  I am thinking that a portable swing mill may be easier to keep in the cut, unless you have a ton of bands, and or have a guy to stay on top of blade sharpening all day long, if you ran 4 mills you would need it, otherwise your production will suffer, not to mention lumber quality will be compromised cutting with a dulled blade.  Just sayin'.  Do you have a market to sell milled alder to?  That will be a key part of a make or break deal.  If you have contracts in the hand, for enough volume for this type of deal to pay off, then you may have a winning deal.  Since you are on the coast, have you thought about having the production equipment on the water?

[D Hagens]

 You have ocean front land in B.C that you plan to log? I hope you have all your ducks in a row for this one as in all the environmental impact statements, all the right permits and approvals and you've run it by a residential impact board.
 You state that you're going to be using a landing craft so that says to me more than likely you're on an outer island? In your profile you don't state where you are from, could you up date that for us please!
 Also where did you find 600 acres of red alder from?

[SwampDonkey]

I just thought I read the story for the week in the forum, but this is right up there.

My plan at this stage is to send 8 to 10 guys into the woods with this equipment and have them mill right where they fall the trees.  If we can average 8000 bf per day we can produce 2 million bf in 200 days and then go to Hawaii for the rest of the year.

Am I being overly optimistic to believe that 10 guys can fall, limb and mill 8000 bf a day with portable ban saw mills?

If we can get just a buck a bf

 

[logwalker]

My advice is to hire loggers to go in and harvest the first thinning of the logs. Finding a market may not be easy at this time. Assuming you can, proceed with the first phase. If all works then consider one mill of medium capacity on site with a forwarding crew feeding it. After you try to make that work, then decide if you want to get larger.

Don't sell your fishing boat.

Joe

[terrifictimbersllc]

I liked reading your analysis and wish you the best.  But I was thinking also that sawing 200 days a year at 2000 bf/day per each of 4 mills finding sawyers and keeping the mills running sounds very stretched.  Unless you needed 4 mills to be spread out over the area it would be better to try to do it with two mills at the same location and each outfitted for high production with conveyor tables, edger etc. and to reduce required manpower. I would think two LT-70 type mills run most of each day might not be out of the question  to mill and dead stack 8000 bf of softwood on a daily basis,  from ready logs, 2 sawyers and 2-3 other workers.  But that requires both highly motivated helpers and sawyers, and days where things go perfectly. But you're not going to have 200/200 perfect days.  If I were one of the sawyers, unless you paid me pretty well for that kind of production, isolation and time commitment, I'd rather prefer to be running my own business with a more diversified client base.    Maybe FF would be a place to recruit a sawyer base?

[SwampDonkey]

I have measured a fair amount of red alder. At the time (mid 90's) it was one of those species in the road of getting at the spruce on the other side. It had to be tallied, but it didn't seem to have much value. What is your estimate of defect in those woods? Do you think all those big trees are going to yield high grade lumber?  I'm thinking (green) red alder might fetch about $0.35-$0.50 a board foot. And how's your grading skills and sawing skills for that matter? Do you have a contract for volume and price, delivery schedule? What happens when 3 out of 10 guys show up when they feel like it, 2 don't work Fridays plus all the associated blat'n?

[Ron Wenrich]

I've got 600 acres of remote ocean front land in BC that is loaded with 16 year old Red Alders.  I have plans to thin about 100 acres per year (about 200 trees thinned out per acre) starting in 2012.  I estimate between 400 and 500 big trees on the land at present (10" plus DBH).  I expect the average tree by 2012, will be about 12 to 15 inches DBH.  After thinning all 600 acres, my plan is to harvest 30 acres per year of 200 to 300 trees per acre of 18" plus inches DBH trees.  The gross numbers look very encouraging but being a commercial fisherman by trade I have a lot to learn.

You have estimated that there is less than 1 tree/acre that's over 10" dbh.  Is that what I'm reading?  The balance is in 16 year old wood.  But, next year, you're predicting the average 18 year old red alder will be between 12-15" dbh.  That's some really impressive growth.  

Then, we're going to start with 200 trees/acre, thin them back to 100/acre.  Then, after thinning, you're going to have 200-300 trees/acre that avgs 18" dbh.  Just let that soak in for a minute.  You're saying you're going to have 40-60 Mbf/acre in hardwoods.  Furthermore, you're basal area/acre comes in at 300-530 sq ft/acre.  That ain't even close to being realistic.

I'm really interested in the math and the science behind these claims.  I don't think Jim King gets that kind of growth in the Amazon.  

My Plan is to buy a landing craft a 6 wheel drive, flat bed, boom truck that will carry about 10,000 bf of milled lumber and four portable mills as well as some kind of log skidder.  My plan at this stage is to send 8 to 10 guys into the woods with this equipment and have them mill right where they fall the trees.  If we can average 8000 bf per day we can produce 2 million bf in 200 days and then go to Hawaii for the rest of the year.

After talking to a big Mill owner and calculating my log value based on Scribner it seemed like I would be taking it in the shorts compared to the actual value of the wood if i mill it myself.

If they're going to mill right where they cut the tree, why do you need a skidder?  And, 8 Mbf/day would take 250 days of sawing to get 2 MMbf.  Need to sharpen that pencil a bit.

My questions are these:

 Am I being overly optimistic to believe that 10 guys can fall, limb and mill 8000 bf a day with portable ban saw mills?                 
 What are the cheapest most dependable mills that will do the job for me?
  Are there logger out there that are willing to work on a share of gross sales or does the owner have to pay by the hour?

If we can get just a buck a bf, I would expect that loggers and miller could make over $70,000 in 200 days.  Is this enough money to get good guys?

You best have some mighty deep pockets.  I looked at a similar situation in Nicaragua just last year.  But, it was 23,000 acres of blowdown from a hurricane.  Labor was cheap, all the lumber was sold to China, and the timber was big.  They were cutting into cants with chain saws.  I think I could have brought that one in with portable circle mills.  It needed the higher production.  

The way I would handle it would be to put in a higher production mill, preferably circle where you could get 10-15Mbf per day, and add another skidder.  You won't be getting 2 Mbf/day with bandmills, rainy weather, and any type of dirt on the logs.  

To average $1/bf is pretty lofty, considering I can't get that for my better sawn red oak.  You're going to need some really good markets for that number.  My advice is to go back and sharpen that pencil and do some numbers with realistic figures.  

This thread reminds me of the guy that came on here looking for investors to help him recover sunken redwoods off the coast of California.  That one was a real hoot.  Sure wish I could find it.  

[Jeff]

This thread reminds me of the guy that came on here looking for investors to help him recover sunken redwoods off the coast of California.  That one was a real hoot.  Sure wish I could find it.  

I'm sure hoping it's different.

Here is that link Ron.  I used the words redwood and sea to search.

http://www.forestryforum.com/board/index.php/topic,1165.0.html

[RedAlderDude]

I'll try to answer the questions that i can remember.  One gentleman asked about the growth rate.  When I first visited the property 5 years ago the trees were 2 or 3 inches DBH.  After visiting the property this September they were 10" DBH after doing the math I came up with something like 25% diameter increase per year which is very common with red alder for the first 20 years.  I conservatively estimated 20% growth rate to project 12 inches in 2011, 14.6 inches in 2012, 16.5 inches in 2013 and 18.7 inches in 2014.  Even just getting an increase of 15% a year should produce a DBH of over 13 inches which by my calculations should net near 100 BF

[tyb525]

But who are you going to sell it to? I know how it goes, it all seems great until you realize that all those stacks of lumber aren't putting money in your bank account. I haven't found the machine that turns lumber into paper money yet.

[WDH]

Your growth projections should be checked by sampling other alder trees in the surrounding area.  The growth rate that you state is one of the best that I ever heard, so check it out thoroughly.  It sounds too optimistic.

[DanG]

I'll simply give you the advice most often given on this board; Hire a Forester to determine exactly what you have and what you can expect it to yield, before you invest anything in equipment.

[SwampDonkey]

Red alder site index (50 yr @ bh) is close to 40 m on productive sites. Under full light and adequate moisture, a red alder seedling can grow to 1 m or more in the first year and annual height growth can exceed 3 m on some sites during the first 5 years. This rate of growth slows after the juvenile stage. In most stands, red alder trees reach half of their mature height by 15 years of age, and after the age of 50 years, height growth stops. The characteristics of mature red alder are determined primarily by early stand conditions (< 20 years of age) and management beyond this point can do little to improve future size or quality of the stems. When red alder is grown at densities below 300 stems/ha (sph), red alder will retain lower branches for a long period of time, resulting in poor wood quality.

[From: http://www.for.gov.bc.ca/hfp/publications/00050/ralder-salmonberry.pdf]

So they can reach 65 feet (20 m) by age 15 or 16 but begins to slow down for the remainder of it's life and apparently don't respond significantly to thinning activities after this juvenile stage.

[RedAlderDude]

I'll try to answer the questions that i can remember.  I truly do value all the comments from every one of you and thankyou sincerely for your input.

One gentleman asked about the growth rate.  When I first visited the property 5 years ago the trees were 2  inches DBH.  After visiting the property this September they were 10" DBH after doing the math I came up with something like 30 or 40% diameter increase per year which is very common with red alder for the first 20 years.  I conservatively estimated 20% growth rate to project 12 inches in 2011, 14.6 inches in 2012, 16.5 inches in 2013 and 18.7 inches in 2014.  After 6 years of thinning,  The logs should be well over 18" in diameter (dbh) 

Some one asked how I was able to get 600 acres in BC.  This is how....I bought a half acre of highway frontage in Hawaii for $2500 about 10 years ago.  I had 45 acres next to that half acre that i built a house on.  I bought that 45 acres for $120,000. and sold it for a ton of money about a year before the peak in real estate prices.  I basically traded that half acre plus some cash to get the 600 acres in BC.

The property was totally logged 11 years before i bought it..mostly fir and cedar.  Red alder took over after they clear cut the property and I'm estimating  4-500 good size (over 10"dbh)  trees per acre presently.  If i thin out 200 per acre i still have 200 remaining per acre that will grow faster because they have been thinned.  It will take me 6 years to thin the property.  I'm assuming the 200 trees per acre that are remaining will easily be over 18" DBH by seven and a half years from now.  I don't think I'm overly optimistic on this figure.

As far as the $1 per bf price goes.  It was just a ball park guess.  A big Mill near my home (I live in Port Townsend Washington) quoted me $65 per 1000 bf for just the logs, if the logs are at least 16 feet long and the narrow end is at least 8 inches.  However they estimate bf using Scribner rules which seems like a lot less than can be attained by ban saws.  I just assumed that if i milled it myself, I could do substantially better than raw logs.  Red Alder is the favorite lumber of the Chinese for making furniture.

Some one mentioned that i wouldn't need a skidder.  I thought that if i set up the portable mills next to the acre i hoped to harvest in two days, that a skidder would come in handy.  It seemed to me that moving  the mills continuously to get close to where i was cutting would be labor intensive, considering a skidder doesn't cost that much money.   

The reason I thought it would be better to mill where i was cutting rather than have a stationary big mill is because it seemed to me logistically more simple.  Load the truck once a day then drive the load on to the landing craft as opposed to, load the logs on the truck, drive a half a mile, unload the truck, twice a day at least and then have to reload the truck with the milled product.  To me it seems like to much f------ around.  If a crew is all working in the same area, the loggers could help mill if they got ahead on falling and also help load the truck.  Maybe i need to hire a bigger crew to get 8000 bf a day it sounds like though.  I was reading posts in this forum where single guys were producing over a 1000 bf  a day with pretty basic mills.

Some one commented on the weather and the ability to work on some days.  I was thinking that I would hire guys based on production.  Being a commercial fishermen, I'm used to fishing in high seas and *DanG cold weather.  I kind of thought most loggers were of the same ilk and maybe even tougher.  I have found that by providing good incentives for production usually keeps a crew producing.  2 million bf even at only .75 a bf is a lot of dough.  Do most loggers make $10,000 a month or should i really expect to have to pay more?

Ideally I would like to hire a logging crew that just delivered the product to the beach for me.  The problem with hauling logs to market becomes a fuel cost problem  not to mention the time to transfer logs as opposed to pallets of planks.

Someone asked about milling on the water which is something that I'm strongly considering.  I have found a small ship that will carry 2 million bf that i can afford.  I thought about building sections in the hold with the capacity to dry the lumber.  The ship idea would also pay off if I can find a market in China,  I'll run the stuff to China myself.

I understand that having a market set up in advance is the key to making this thing fly.  I wouldn't risk it , if,  I in fact I did not have that market.  Worst case scenario, I could just load a barge or ship with raw logs which I expect might be the logical thing to do for the first few years and just plan on making a lot less money until i get all my ducks in a row.  Can  anybody tell me what i should expect to pay a logging crew to just fall and limb and haul to the beach 20,000 trees?  I can buy all the equipment necessary to make this thing fly  (Knock on  wood)

Thanks again for the help and I look forward to more critiquing of my hair brained idea (smile)

[SwampDonkey]

Your red alder as I pointed out isn't going to respond with the growth spurt they had up until 16-20 years. Thinning has no appreciable increased rate of growth after that, which seems a little odd to me. But, I can't rebut it since I'm not out there working in it.

[ljmathias]

A phrase I heard somewhere keeps whirling around in my head: "If it's so easy, why isn't everyone doing it?"  I guess I'd ask around in the area where the land is located- see if anyone else is, has or plans to cut and sell like you are.  Another phrase that keeps popping up: "If it sounds too good to be true, maybe it is."  Not trying to throw cold water on your parade (mixed metaphor?) but I've seen too many friends and relatives piddle away a whole lot of money, my dad foremost: he was a millionaire at one time (by his own reckoning) and ended up dieing of lung cancer stone cold broke- was good at real estate so he opened an auto parts store; lost a bundle.  He was good at real estate, so he opened an ice cream store... and the list goes on and on.

I think the general advice (take it or leave it) can be summarized this way: get an expert (forester) to look your property over for you, find out all you can about the market and its ups and downs (more downs then ups lately), start small and build using your profits to expand (no profits? no expansion and get out quick)....

Anyway you look at it, it sounds like you have a nice place to retire to- maybe that's when getting a sawmill and making lumber will be more productive for you: the only employee you can count on is yourself and even he gives you fits most days...

Lj