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Lumber Pricing

Started by Horselog, March 09, 2016, 09:30:41 AM

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Horselog

I just spoke with a buyer at a large lumber company and he gave me some prices that this newbie to sawing doesn't understand yet. Here's how he quoted:

4/4 WO. Market + Premium+ $100+Freight

If I had to guess I would say that "market" is HMR numbers, "premium" is some industry standard add-on, $100 is the amount above market, and freight means they pay freight?  He said I needed to take care of trucking, which I assumed meant I set it up and handle it.

Can anyone help?
Benjamin Harris
Appalachian Mountains of Virginia
horse_logger@me.com

4x4American

What's the $100 for  ???


I can't help but I'm following to see what the experienced folks bring to the table.
Boy, back in my day..

Horselog

I going to put a post in here to shoot this back to the top.  I am curious that no one so far seems to have an idea about what this pricing language is. 

Benjamin Harris
Appalachian Mountains of Virginia
horse_logger@me.com

paul case

I was and am confused by it as well.
My lumber buyer buys at the hardwood market report price. No formula necessary.
PC
life is too short to be too serious. (some idiot)
2013 LT40SHE25 and Riehl edger,  WM 94 LT40 hd E15. Cut my sawing ''teeth'' on an EZ Boardwalk
sawing oak.hickory,ERC,walnut and almost anything else that shows up.
Don't get phylosophical with me. you will loose me for sure.
pc

YellowHammer

What did you ask him to quote?  Non standard length, widths, quality, quantity, etc. will generally incurr extra costs. Same with small quantities, as some places won't sell less than a unit, some won't sell less than a truckload without an up charge. Some places will add for sorting beyond mill run. 
YellowHammerisms:

Take steps to save steps.

If it won't roll, its not a log; it's still a tree.  Sawmills cut logs, not trees.

Kiln drying wood: When the cookies are burned, they're burned, and you can't fix them.

Sawing is fun for the first couple million boards.

Be smarter than the sawdust

Ron Wenrich

I'm a little confused by the way its written.  Market + premium + $100 should mean they are paying $100 over HMR.  + Freight indicates they are paying for freight, which is unusual in the way its presented.  I'm not sure if the $100 is premium, or what they will pay for freight.  It would be hard to believe that they would allow that to be blank and allow you to set the rate.  Most quotes would be FOB, where they send a truck and you load it.  If you were paying for freight, then the quote would be a delivered price. 

You also have to look at discounted price.  Sometimes they have a 2-4% discount if paid in 10 days, and no discount to 11-30 days.  They might also say trailerload lots.  That's why the trucking thing gets to be a little fuzzy.  If you take in 1 Mbf of lumber, are they going to pay full freight or the $100?  They also may have a breakdown of the lengths required to get the premium.  If you have a load of 8' and shorter, there might not be any premium. 

Call back and get clarification. 
Never under estimate the power of stupid people in large groups.

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