pallet cutstock

[doghunter]

Any one out there cutting pallet parts or cutstock my hardwood pulpwood markets are lousy here so[$22per ton] I'm thinking of giving it a try I need some info on prices my buyer wants5/8"x4"x42" or 48"and5/8"x6"x42"or 48"also a small amount of shorter lenghts i already cut ties and pallet cants from some of my low grade logs so im not new to this  Thinking of adding a horizontal band resaw and chop saw

[paul case]

i have been cutting most of my edgings into 5/8 x 4 x 40 for a year now. i get $.32 each delivered to the pallet mill. the folks i sell to actually pay a little more than some others near me. this works well for me since the pallet stock gets used and not graded. they wont take any bark though. a fella would have to plan to make a lot of those boards to be able to make another machine pay. i cut all mine on the mill so i cant say wether it would be faster with a resaw but i suspect it would. that also causes a need for more labor too.
i dont want to add more labor so i will keep making these on the mill.  pc

[doghunter]

i al ready a chop saw to cut it up  and i'm definitley not gonna hire any labor just saw on the mill and then cut it up and stack it probably i'm looking to get in out of the cold too[is 52 really old] also i have about 100,000' of hemlock on my own property that i will have to cut in the next 2 years [wooly adelgid] seems like a good market for the odd stuff and narrows from it i have a market for the larger logs and sometimes framing and beams so i get stuck with the odds and ends.

[Ron Wenrich]

I think a lot is going to depend on your setup.  Most guys, me included, think that cutting pallet stock is the slow way to the poor house.  Your mill could be producing a higher dollar yielding product.  Profit = lumber value - log costs - mfg costs.  Can't get around that fact.  Your job, as a manager, is to maximize the profit.  Either raise lumber value, lower log costs, or lower mfg costs.  Breakeven analysis is where lumber value = log costs + mfg costs.  Producing anything else is producing at a loss.

First thing you're going to want to get rid of is repetitive cuts.  That means that if you're going to cut pallet stock, you're going to want to get the most results from a single action.  If you've ever been to a pallet company, they take pallet cants and double end trim them.  They're trimming a bunch of boards at one time.  A chop saw might do it, but figure up your production time.

Next step is resaw.  The plants I've been through use a gang saw.  That's for production.  Others may opt out for the band resaw, which will yield a few more boards.  As long as the board yield is greater than the additional sawing costs, than you're OK. 

Material handling.  Most pallet mills have automatic stackers.  The boards come from a gang resaw and are placed on a stack.  No handling costs.  Can you compete with that?  What are your costs?

The most production in the least amount of time results in the lowest sawing costs.  You can't get around that fact.  Now, step back and ask yourself if the pallet stock buyer is going to give you more than what he can produce that stock for himself.  If times are good and he needs supply, yes, maybe he'll pay a premium.  But, chances are, he's only going to pay you less than what he can produce it for.  So, he's your competition, and your market. 

If you're cutting ties and pallet cants, stick with it.  If you want to cut pallet stock, crunch the numbers.  You want your mill to produce the maximum amount of profit on each cut.  Some cuts win, some cuts lose.  That's the nature of the business.  You need to have more winners than losers. 

[doghunter]

im not going to stop cutting ties and cants i just need a market for the side boards and my hemlock leftovers.

[paul case]

doghunter,
if you are like me and trying to make a full time or part time use of your mill and timber and you want to get as much from it as possible, pallet cutstock will cost you a little time but will use up shorts and outside boards from ties cants and even narrow stuff from the outside of logs that dont make fas grade.
the bark restriction hurt me for a while. i made a lot of seconds into firewood at first. then i found a pallet recycler that will buy those #2's to fix up old used skids. it dont pay as much as the good ones but it uses them up. you kinda have to make them to see if they will be #1 or #2. pc

[Frickman]

I made cutstock on a conventional handset circle mill with a cutoff saw for years. As Ron said, it is the slow way to the poor house if that is all you're doing. I did it though as you're planning to do and made it out of odds and ends side cuts. We never made a huge profit, but we never lost anything either. Many times my offbearer would stack untrimmed boards by the cutoff saw while we sawed and work them into deck boards during slack time, say while I loaded more logs onto the deck or visited with a retail customer. It was fill in work really, but very important. We would turn short, low grade, and other orphan boards into a reasonably priced product with a ready market. If the offbearer cut up slabs into firewood at the same time he would earn his wages and then some with the firewood he produced. It worked out well all around but we did not chase pallet cutstock, just produced it as it came along.

[Ron Wenrich]

im not going to stop cutting ties and cants i just need a market for the side boards and my hemlock leftovers.

Just remember that your sawing costs are going to be double that of 4/4 lumber.  That will be because you will have to pull 2 boards to equal the volume of every 4/4 board.  You still have the extra step of double end trimming. 

[paul case]

for us smaller operations though pallet stock can be profitable. i dont always look at every cut as a money cut, but i consider the whole log as something sellable.i still make plenty of firewood and cut anything i can into pallet stock. it may be my opinion, but i believe that pallet stock is worth more than firewood and it is very do able for the small operation like mine.when cutting custom orders i get some lumber off the sides that wouldnt make grade and it makes fine pallet boards.
last year,2010, i cut almost $7k worth of pallet stock. that would be 58 loads of firewood to make up the difference. pc

[doghunter]

we sent two bundles of 5/8"x4"&6" random length pallet boards with our last load of cants the pallet mill pays for 5/8 plus their saw kerf at $250 per thousand not a lot but better than being stuck with the low grade from the sides of our cants, railroad ties and odds and ends from cutting special orders of pine or hemlock.

[Kansas]

Doghunter, get on the phone and start calling every pallet manufacturer out in your area. See if there is one that is looking for odd length, width or thickness. Big mills a lot of times don't want to mess with the unusual stuff. Don't be afraid to charge for it. Main thing is if you can get it done when they need it. A lot of these are small lots. But if if someone needs 9' 2x4s for a specialty  pallet built for a salvage yard for car parts, and only needs 200 of them, then that should command a premium. And if your wanting to get in out of the cold, start knocking on doors at places like that. Its not that hard to take a nail gun and put a little more premium on your product. Pallets aren't hard to build, they just take a little time.

[WH_Conley]

I build a little pallet for a company. They only take a couple of hundred a year. A pallet company that is right in their front door won't make them a solid top pallet. I get double what the professional pallet mill gets.

[Ron Wenrich]

We're getting $280 for 1x4 or 1x6 separated by even lengths.  No trimming.  They are boards that won't make grade.  Pallet companies either use them for stringers or resaw them.  Not a lot of money, but, no extra work.

[Meadows Miller]

Gday

I see the point in sawing it if you using it it as a recovery component of your production with minimal labour required or in something like Kansas's operation where they produce pellet stock for their own use and value add it into a finished product that being Pallets  ;) theres good money in pallets but you have to cut out all the lazy middle men who want to pay you bugger all for your hard work and then profit for themselves I cant stand it these days when I have blokes ring me and say I cant afford to pay that much for pallet timber  I just say well I wont cut it then ;)

Put it this way I can build a shed buy a machine nails and pay a bloke to operate and brand pallets out of cut stock at less than ) $0.10 cents a bft I would get about $0.50 cents a bft for pine cut stock and about $1 a bft for a finished pine pallet stacked in the yard down here do the math for your own operation   ;)

Regards Chris

[paul case]

there is a pallet mill near me that pays $.22 bdft on pallet logs. then another pallet mfger near me wants to buy 4x6's from me for $.27 bdft. the math dont work out on that one.pc

[Kansas]

I had a call from an outfit from out west looking for highway bale stakes, and dunnage. I shot a way high price. We are very busy, and if I don't get the business that's fine. I seriously doubt we will. Its one thing if your starving to death to do something too cheap. If not, you need to set the price, not your customer. The most successful logger I know sorts all of his logs into multiple grades and knows exactly where he can go to get the most money. In many cases,maybe most, he sets the prices. That is why its so important to keep trying to find opportunities for your particular operation that fits best with what you have for your equipment, plus keeping your mind open to what is possible beyond that. I never thought we would be in the skid and crate business. But, that is where the money led us.

[Ron Wenrich]

Loggers make money marketing logs, not cutting trees.  The smart ones have figured it out.  Same goes with mills.  Separate out the grades and market the grade.  We peel off the grade and shoot for the highest value piece of blocking. 

[doghunter]

exactly my method of operation ron. i market every thing from veneer logs ,plywood peelers, high grade saw logs,low grade sawlogs, tie logs,custom cut lumber, pallet lumber,fence posts, pole length& cut and split firewood .some times i specie sort because some mils pay more for what they really want.most big loggers around here only have two products logs and pulpwood. I just can't operate that way merchandising is the only way a small logger can make these times.
                                   doghunter