It's starting to be a battle between thin kerf technology and conventional circle mills. Who's right and who's wrong depends on the application. But, someone who is thinking about using this technology must have an idea when to apply it. Thin kerf has its place. There are gains in yield, but at a slower production pace. Sometimes the increased yield does not offset the higher costs. If your livelyhood is in custom sawing, then higher yields will benefit your customer. Other benefits include portability. Since it is a service based business, higher production costs can be passed on. But, when buying logs and selling lumber is your business, then there is a breakeven point where it makes more sense to go with thin kerf over circle mills. Here is how I have approached and solved the dilema.

I have started with the basic formula that profit = lumber value - log costs - production costs. Since we are comparing two different systems at breakeven, you can use the following equation. Lumber value circle mill - log costs - production costs circle mill = lumber value band mill - log cots - production cost band mill The next factor to consider is that log costs are equal. It is assumed that you can buy logs for the same price to fuel either operation. So, log costs can be factored out of the equation. Next, convert all numbers to $/Mbf (1,000 board feet). Annual production/annual costs will give a good production cost. Lumber value is for log run lumber value. We are now left with the following: Lumber value circle mill - production costs circle mill = lumber value band mill - production costs band mill Another factor that must be taken into account is overrun. Thin kerf mills will give more lumber than a circle mill or even a large band mill. It will vary from log size to log size. Overrun should be stated as a percentage of extra lumber from one operation to the next. not over log scale. You may also get an overrun in the lumber value. This is for the lumber value of the entire log, and should also be stated as a percentage. These percentages are added together, then divided by 100 to make a decimal. For example, if thin kerf is producing 20% more lumber and 5% more value, then overrun factor to use is 0.25. Now, to find the breakeven point we can apply the following formula: $/Mbf of log run lumber = (production cost band mill - production cost circle mill) / overrun factor If you are considering a circle mill operation with a production cost of $150/Mbf and a thin kerf sawmill with a production cost of $250/Mbf, and there is a 20% overrun in volume and a 5% overrun in value, you will come up with this: $/Mbf = (250-150)/.25 = $400/Mbf What this means is that logs that yield lumber greater than $400/Mbf would yield more value if sawn with thin kerf technology than with circle mill technology. Logs yielding less value would be more economically processed on a circle mill. One thing for sure is that the breakeven point will vary with each species and size of log. It may also be beneficial to incorporate thin kerf as a resaw in a conventional mill. Accurate data that takes into consideration grade yield, volume yield, sawing time and production costs can refine this point even further.

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