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Big tract cruising

Started by Geoff Kegerreis, January 04, 2011, 09:37:56 AM

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Geoff Kegerreis

If you were asked to validate the figures of a cruise done by someone else on 200,000 acres in less than a week how would you do it?
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

Texas Ranger

Delineate the stands on a hi res photo, run plots for the period of time I had with representations of the stands, consolidate data and compare. 

A lot of variables, if it is 200,000 acres of plantation, it gets real easy.  Plus, if you have the original cruise data you can use some of their early work to establish your own.

Regardless, there would be a clause in the report that due to time restraints the data collected was insufficient for the size of the project.

A WHOLE lot of variables to consider. A minimal cruise would run to 6000 points in uniform stands.  More if wildly mixed stands.

Or, charge a lot and hire a whole bunch of foresters to run the job. But, that many foresters would be hard to come by.

Interesting question.
The Ranger, home of Texas Forestry

Ron Scott

I wouldn't take the job. ;) What's the purpose and scope of the validation needed in such a short time frame? Are the original cruise plots locatable on the ground, on photos, on paper, etc? In that time frame, about all you can do is validate the process used for the previous cruise and the credentials of the person who did it.
~Ron

SwampDonkey

I would do random checks on some of their points if they are locatable and well marked, and not even try to attempt that scope in a week and claim my cruise was better.  ::)
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

woodtroll

What SwampDonkey said, plus charge a lot of $$$.

Geoff Kegerreis

Quote from: Ron Scott on January 04, 2011, 12:30:17 PM
I wouldn't take the job. ;) What's the purpose and scope of the validation needed in such a short time frame?

Good questions, Ron - The purpose of the validation would be to have a third party assessment of a total volume figure.  The scope is of course as I stated completely and utterly restrained to less than a week.  The reason for this is that the price of the tract has significantly reduced to a point that the buyer is willing to purchase it - but the purchase agreement has allowed for a due diligence period which for all purposes is up in less than a week.

QuoteAre the original cruise plots locatable on the ground, on photos, on paper, etc?

Nope.

Quote
In that time frame, about all you can do is validate the process used for the precious cruise and the credentials of the person who did it.

Well, that's probably the most prudent action!
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

Ron Wenrich

Kinda reminds me of a timber appraisal a guy asked me to do.  He wanted me to fly over 500,000 acres of timber in Africa and give him an idea of how much it was worth.  I told him I couldn't even identify the trees on the ground, let alone from the air. 

Then, he wanted to know if it could be logged in 3 months. 

I think I'd pass on the 200,000 acres, as well. 
Never under estimate the power of stupid people in large groups.

Gary_C

It's a no win situation. No matter how many excuses you put in your report, you could be held responsible if your numbers are wrong.

Run, don't just walk away unless you want to be a scapegoat.
Never take life seriously. Nobody gets out alive anyway.

Clark

The only other thing I can think of that you could do is compare the volume/acre with regional averages.  Obviously this would be best if it were broken down into acres per stand type and only very obvious discrepancies would show up.  Something like all the mature pine stands average out to have 15 cords/acre :o or some other anomaly.

Overall it sounds like a good way to get backed into a corner and have to tell them whatever they want to hear because, let's face it, you won't be able to tell them much of anything good or bad after a week!

Clark
SAF Certified Forester

Geoff Kegerreis

Quote from: SwampDonkey on January 04, 2011, 04:20:25 PM
I would do random checks on some of their points if they are locatable and well marked, and not even try to attempt that scope in a week and claim my cruise was better.  ::)

Ha ha...Yeah, I got 200 plots over 200k acres and my cruise will perfectly represent the entire volume figure of standing timber.  Gentlemen, feel free to plunk your $80 mill on this chunk of land. :D


(and please sign this certificate of indemnification and hold harmless while you are at it).  8)

Uhhh...NO.  ;D

Here are my ideas on it:

1. First thought: Impossible job.
2. Second thought: Nothing is impossible.
3. Third thought: Probability proportional to prediction model designed solely for check of the volume figure. sample type, size, distribution, etc. custom designed to give as accurate of outcome as possible, forecast for a particular confidence interval and absolute precision figure - everything possible under the constraint of the short time period.  Keep in mind that just transportation alone over an area this size would be a very time consuming endeavor, much less the planning of the sample and operations in general.

Any sample design would result in a precursory cruise at best.  Would it be able to validate the cruise that was previously done on the tract?  I guess you would have to pose that question to the buyer!

Lets put it this way: If it was your $80 mil and you were buying a 200k acre tract of land that someone else had cruised (hired by the seller), but you weren't sure it was right - the primary use of the property is timber investment & development property, you had a week to finish collecting information on the property - but you're swamped...


...Would you:

a. Hire a forester with known competent experience in timber cruising run some points through there and do a flyover to check to see if that figure seems reasonable at a cost of $20k?
b. Risk it (accept the seller's cruise data).
c. Give up your opportunity to purchase it at a price that (based on the current cruise data) could double your money over the next decade?

Note: All info and #s are hypothetical - though these sorts of problems do exist!   :)  









I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

Geoff Kegerreis

Quote from: Ron Wenrich on January 04, 2011, 08:30:52 PM
Kinda reminds me of a timber appraisal a guy asked me to do.  He wanted me to fly over 500,000 acres of timber in Africa and give him an idea of how much it was worth.  I told him I couldn't even identify the trees on the ground, let alone from the air. 

Then, he wanted to know if it could be logged in 3 months. 

I think I'd pass on the 200,000 acres, as well. 

:D  Here's the answer: $1 bil.  Sure.  Please pay my invoice for $2bil.   ;D
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

SwampDonkey

If you could just check some plots it would tell you whether the cruise was trustworthy or not, that's my point. And I think that is the main purpose for this buyer. Because why is the buyer all nervous with this cruise any more than someone elses. I guess they should'a done it themselves. I back away from "fly by the seat of the pants" has to be done yesterday jobs.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

Ianab

Quotea. Hire a forester with known competent experience in timber cruising run some points through there and do a flyover to check to see if that figure seems reasonable at a cost of $20k?

If 80mil are at stake, some sort of check is in order.

Some random samples, a flyover, sat pics to check the whole area even has trees on it.

If it was 20,000 acres you would expect to be able to get a rough estimate in day, especially if you had a couple of hours in a helicopter. You don't expect to count every individual tree, so it's only an estimate.

On a huge tract, if the one week mini-survey comes up with similar numbers, then it's $$ well spent, and insignificant in the cost of the deal. If the quick survey comes up with only 1/2 the value - then alarm bells should ring, and you need to investigate further

Ian
Weekend warrior, Peterson JP test pilot, Dolmar 7900 and Stihl MS310 saws and  the usual collection of power tools :)

Ron Wenrich

Who did the previous cruise?  Is it an independent cruise?  At some point, someone's going to have to figure out if the original cruise is good and can be trusted.  It should have a pretty decent map of the area, and it should have the stands delineated.  That could be a good jumping off point.

Let's figure that instead of doing an entire cruise and putting your numbers up against another cruiser's numbers, you're just going to verify that it looks reasonable.  If the cruise data is within standards for the area by timber type, age and acreage, you could have a good starting point.  Use photos to verify the stands.  

Verifying vs a brand new cruise would be worth the $20k (which is 10¢/acre).  You won't need a fly over, as the photos have done that.  They're only asking if the cruise is realistic, not the volume you think is there.  
Never under estimate the power of stupid people in large groups.

Geoff Kegerreis

Quote from: SwampDonkey on January 05, 2011, 05:27:33 AM
If you could just check some plots it would tell you whether the cruise was trustworthy or not, that's my point. And I think that is the main purpose for this buyer. Because why is the buyer all nervous with this cruise any more than someone elses. I guess they should'a done it themselves. I back away from "fly by the seat of the pants" has to be done yesterday jobs.

I agree with the plot & calculation checking - that is a piece of cake and a lot quicker than the kind of cruise I have in mind - problem is, if there are no plots available to check (plot center locations were not recorded nor marked - or even if they were but the firm or client that paid for it won't offer it, you're out of luck).
 
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

Geoff Kegerreis

Quote from: Ianab on January 05, 2011, 05:55:52 AM
Quotea. Hire a forester with known competent experience in timber cruising run some points through there and do a flyover to check to see if that figure seems reasonable at a cost of $20k?

If 80mil are at stake, some sort of check is in order.

Some random samples, a flyover, sat pics to check the whole area even has trees on it.

If it was 20,000 acres you would expect to be able to get a rough estimate in day, especially if you had a couple of hours in a helicopter. You don't expect to count every individual tree, so it's only an estimate.

On a huge tract, if the one week mini-survey comes up with similar numbers, then it's $$ well spent, and insignificant in the cost of the deal. If the quick survey comes up with only 1/2 the value - then alarm bells should ring, and you need to investigate further

Ian

That's pretty much my exact general thought right there.
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

Geoff Kegerreis

Quote from: Ron Wenrich on January 05, 2011, 05:59:02 AM
Who did the previous cruise?  Is it an independent cruise?

A BIG consulting firm - not sure the techniques of the cruise (lots of big consulting houses & industry these days are utilizing high tech methods that are of questionable accuracy - one example is via lidar).

QuoteAt some point, someone's going to have to figure out if the original cruise is good and can be trusted.  It should have a pretty decent map of the area, and it should have the stands delineated.  That could be a good jumping off point.

Agreed.

QuoteLet's figure that instead of doing an entire cruise and putting your numbers up against another cruiser's numbers, you're just going to verify that it looks reasonable.  If the cruise data is within standards for the area by timber type, age and acreage, you could have a good starting point.  Use photos to verify the stands.

It would be extremely difficult to verify the stands over 200k acres in a week or less at any level of scale via photos, which is why another method would be necessary - unless you had a dozen foresters on the job splitting the labor + the fact that you would need imagery that was collected very recently, otherwise recent activity would be unknown. 

QuoteVerifying vs a brand new cruise would be worth the $20k (which is 10¢/acre).  You won't need a fly over, as the photos have done that.  They're only asking if the cruise is realistic, not the volume you think is there.  
Flyover = real-time, real-world observation.  Imagery is a great tool, but has its limitations, though it is difficult to justify $2500/hr. for a chopper unless you're in a hurry  ;D
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

woodtroll

Wait,
Are they buying 200,000 acres for $80 mil?
Let me get my pencil out...
Isn't that $400 and acre?

Does/can the timber in that area bring $400 an acre?

The whole thing make me think,
"Hmm... I want to make an $80million decision based on info verified in a week?"

Geoff Kegerreis

Quote from: woodtroll on January 05, 2011, 06:23:19 PM
Wait,
Are they buying 200,000 acres for $80 mil?
Let me get my pencil out...
Isn't that $400 and acre?

Does/can the timber in that area bring $400 an acre?

The whole thing make me think,
"Hmm... I want to make an $80million decision based on info verified in a week?"

All the numbers and info are fictitious, but certainly there are tracts that size for about that price +/- out there - it only takes enough people with enough money to get together and buy them - some people are wealthy enough to buy a tract of timber like that with the same level of caution that we might purchase a chainsaw.   Crazy, but true. 
I have an active lifestyle that keeps me away from internet forums these days - If I don't reply, it's not personal - feel free to shoot me an e-mail via my website (on profile) if there is something I can help you with!  :-)

WDH

What is commonly done in large timberland transactions is the buyer makes an offer based on the sellers data on a per acre basis that is contingent on a joint cruise to verify the volumes.   The joint cruise is done by a third party acceptable to both the buyer and the seller and both split the cost.  After the cruise is done, the per acre values are adjusted appropriately.
Woodmizer LT40HDD35, John Deere 2155, Kubota M5-111, Kubota L2501, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

woodtroll


Ironwood

I agree w/ WDH. Seems with that kinda coin involved it should/ could be written into the contract that it would be done after the fact and a certain % held in escrow until a point in time that this is figured out.

Ironwood
There is no scarcity of opportunity to make a living at what you love to do, there is only scarcity of resolve to make it happen.- Wayne Dyer

SwampDonkey

Recent freehold swaps up here are much lower in price, but we are talking about more than twice those acres. They typically have gone for $200/acre. At that price they don't get to worked up over a cruise. Much of the land will have been cut, thinned out or planted. It's a good deal for the buyer in my opinion. Even $400 is pretty good to for the buyer. How many woodlots can you purchase at those dollars? ;) We have one mill here that has been buying up woodlots with full timber for far less than $400. $20,000 is a lot more $$ than a lot of old widows seen at once for their 100 acres.  ::) The ones whose husbands were woodsmen have better knowledge. I've seen some vultures try to swindle an old lady after here husband passed away, she was one step ahead of the game, she knew the woods business. He had hundreds of acres he left behind and much of it wooded. Some fellas never cut their own ground.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

Tillaway

I have been involved in a few similar projects.  The advise so far is spot on.  You need to random check individual stands to see if the seller supplied inventory data is accurate.  Windsheild cruise to see if the all the stand still even exist.  The seller may have accelerated harvest since the inventory was done.  If you don't have help I might just pass on the project.  Every time I was involved we would have up to 8 or so people and about a week ot two to look around.   
Making Tillamook Bay safe for bait; one salmon at a time.

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