Introduction:

This document is intended to be a brief tutorial about the Richen Tree Farm business. It is divided into the following sections:

1.           Products

2.           Current prices

3.           Measurement

4.           Customers

5.           The numbers

6.           Other issues

7.           How we spend our time

I’ve borrowed material from Oregon Department of Forestry; Oregon State Extension Service; Western Wood Products Association; and the Idaho Forest Stewardship Program. You should check their web pages if you want more information.

1.  Products: Logs - Price depends on specie and grade:

a.  Species(obtained from Oregon Dept of Forestry Web Page-www.odf.state.or.us) and Western Wood Products Assn (www.lumberbasics.org)

The Western Wood Products Association writes grading rules for the major species in the West.

There are more than 15 commercially important western softwood species. The lumber from several of the western softwood species shares performance properties and is similar enough in appearance that many species are grouped together into the following “Marketing Categories”.

Douglas Fir Accounts for most of the lumber produced in the Western Region, followed by Hem-Fir and Ponderosa Pine.

·         Douglas Fir

1.    Douglas Fir – Pseudotsuga menziesii

2.    Western Larch – Larix occidentalis

·         Douglas Fir – South: Douglas Fir grown in AZ, CO, NV, NM, & UT

·         Hem-Fir (also known as white wood)

1.    Western Hemlock – Tsuga heterophylla

2.    Noble Fir – Abies procera

3.    California Red Fir – Abies magnifica

4.    Grand Fir – Abies grandis

5.    Pacific Silver Fir – Abies amabilis

6.    White Fir – Abies concolor

·         Spruce

1.    Sitka Spruce – Picea sitchensis

2.    Engelmann Spruce – Picea engelmannii

3.    Lodgepole pine – Pinus contorta

·         Alpine Fir aka Subalpine Fir – Abies lasiocarpa

·         Ponderosa Pine – Pinus ponderosa

·         Idaho White Pine aka Western White Pine – Pinus monticola

·         Mountain Hemlock – Tsuga mertensiana

·         Cedar

1.    Incense Cedar – Libocedrus decurrens

2.    Western Red Cedar – Thuja plicata

3.    Port Orford Cedar – Chamaecyparis lawsoniana

4.    Alaskan Yellow Cedar – Chamaecyparis nootkatensis

In addition to the softwood species shown above, there are markets for hardwood species.

Richen Tree Farms (RTF) produces Douglas Fir, Hem-Fir, Western Red Cedar, a little Sitka Spruce, Red Alder(Alnus rubra),and Bigleaf Maple(Acer macrophyllum)

b.  Grades –

Other notes about log grades:

Wormy =Wormy Cedar Logs  (Not meeting requirements of 4S because of excessive worm  holes) 

These grade specifications may imply only that a log is suitable for producing certain types and qualities of products, but a manufacturer may choose to do otherwise, (e.g. a veneer plant 

may utilize 2S DF to produce veneer).

Note: Logs are scaled and graded at certified scaling stations. Often these stations are located at the mill.

Other Products:

·                Cedar Posts – RTF has delivered Cedar posts. Usually sold in 6 ft lengths with 2 to 8 inch diameters (small end).

·                Firewood – RTF has also sold firewood, which is sold by the cord. A cord is measured by stacking the firewood, then obtaining the length, width, and height (in feet) and dividing by 128. A rough conversion factor (based on average diameter of 8”) is 1 cord = 90 cubic feet of solid wood, or 307 board feet.

o                     Weight per Cord and relative heat (OSU Extension Service)

Specie

Weight (pounds)

BTU’s per pound

Million BTU’s per cord

Red Alder

2,812

6,460

18.2

Bigleaf Maple

3,262

6,795

22.2

Douglas Fir

3,308

7,460

24.7

Western Hemlock

3,038

6,880

20.9

Grand Fir

2,498

6,710

16.8

Sitka Spruce

2,700

6,540

17.7

Western Red Cedar

2,160

7,880

10.0

·                Poles and piling: RTF has never sold any poles/piling, but could be lucrative if enough logs are harvested at one time to make a load that meets the following criteria:

o                     Must be cut from live tree

o                     Allow minimum 1 inch of sapwood

o                     No knot can be more than 3” across. The total sum of knot diameters in a 1 ft section can’t be more than 8”.

o                     Trim knots flush, Decay in knots isn’t allowed.

o                     Insect holes must measure 1/16 inch or less. Surface scarring is allowed but all other insect damage is prohibited.

o                     No side or top rot is allowed. Butt end decay is allowed in W.R. Cedar, but must not exceed 10% of butt area.

o                     Sap stain is allowed if there is no wood disintegration.

o                     Trees must be Stringline straight (that is, a straight line from the center of the butt end to the center of the top end must lie within the body of the pole. A log that doesn’t meet this criteria is said to have “sweep”.

o                     No more than 1 inch of taper per 10 ft of log length.

o                     Piling logs have stricter specs on taper, swell, and sweep. Swell is that part of the bottom of the tree above ground where the roots become noticeable and increase the diameter of the stem.

·                Other Niche Markets

There is an initiative underway to develop a joint education and marketing co-op for Oregon forests and forest products. RTF will support this effort and take advantage of opportunities when they are identified.

2.                     Current prices (delivered to mill; from ODF Web Page) These are indicative prices. We need to obtain a purchase order from the log buyer. Pond value means delivered to the mill.

Species & Grade - Price per 1000 board feet 4th QUARTER 2002

Douglas-Fir         POND VALUE     NUMBER OF QUOTES

1P                  $  890              5 or less

2P                  $  785              5 or less

3P                  $  725              5 or less

SM                  $  615              6

2S                  $  535             19

3S                  $  515             14

4S                  $  455             14

SC                  $  200              5 or less

Utility             $   75              5 or less

Hemlock

P                   $  380              5 or less

SM                  $  355              5 or less

2S                  $  350             11

3S                  $  310             10

4S                  $  280              9

Utility             $   60              6

Spruce

SM                  $  350              5 or less

2S                  $  340              5 or less

3S                  $  330              5 or less

4S                  $  300              5 or less

Utility             $   55              5 or less

Western Red Cedar

1S                  $ 1025              5 or less

2S                  $ 1025              5 or less

3S                  $ 1025              5 or less

4S                  $ 1025              5 or less

Utility             $   50              5 or less

Wormy               $  250              5 or less

Red Alder

CR                  $  495              5 or less

Pulp                $  200              5 or less

Note: Alder and occasionally other species are often sold by weight, in order to avoid the cost of scaling/grading.

3.                     Measurement: (a lot of this material was taken from the Idaho publication “Scaling and Marketing Workshop Booklet. References to Eastside marketing rules have been replaced with the Westside rules, because RTF land is on the west side of the Cascade Mountain Range.)

Small, low value logs are often sold by weight, however large logs are usually measured and graded individually using a system that approximates the quantity of lumber that can be sawn from the log. There are over one hundred methods in use around the world, the one used in the west of the Cascade Mountains in Oregon and Washington is called the West Side Scribner Scale.

The original Scribner log rule was based on diagramming the number of boards (one-inch thick, with allowance for slabs, edgings and saw kerf) that could be recovered from a log of a given diameter and length.  The board foot volume was then determined by totaling the volumes of all the boards.  The original Scribner log rule has seen modifications over the years, but its “diagram formula” of one-inch boards forms the basis of log scale volumes used today.

Throughout the United States, lumber volume is expressed in board feet.  A board foot measures 1” x 12” x 1’  (or its equivalent - for example:  three boards, each with dimensions of 1” x 4” x 1’, would equal one board foot).  The formula for determining lumber volume in board feet is:

Board Feet  =  Width(inches)xThickness(inches)x Length(feet)

12

In many instances, the board foot volume of lumber that is produced from a log does not equal the board foot volume expressed by the log scale.  When the amount of lumber actually recovered is more than the amount predicted by the log scale, it is referred to as overrun; if it is less than the amount predicted by the log scale, it is referred to as underrun.  A formula to calculate the percentage of overrun (or underrun) is expressed as:

“Overrun”(underrun)in % =(lumber tally - net log scale)x 100

                           (       net log scale      )

Differences in scale versus lumber yield are due mainly to the design of the Scribner log rule versus the type(s) of end product(s) being manufactured.  Scribner is based on boards that are one-inch thick, actual size.  Lumber production is based on various nominal size board measurements.  This difference may be illustrated by comparing the Scribner diagram with a sawing diagram that reflects production of “two-by-fours” on six-inch diameter logs:

Six-inch diameter logs

1” x 4” actual size boards 2” x 4” nominal size boards

(1.735” x 3.865” actual size)

Æ1 board foot / lineal foot   Æ1.33 board feet / lineal foot

Since lumber products are manufactured in a variety of sizes, the lumber tally in board feet will seldom be the same as determined by the log scale.  Veneer, chips, and sawdust are additional products that may be recovered from a log, and require the use of conversion factors to predict yields. Other factors affecting “overrun” (or underrun) include log sizes, taper of the logs, efficiency of milling machinery, and accuracy of the scaler.  To account for all the variables would require a different scale rule for each end-product.  In the final analysis, scale is simply a standard for measuring log volume whose application is independent of lumber yield.

HOW LOGS ARE MEASURED:

Two measurements determine the scaling cylinder of a log segment – scaling diameter and scaling length. The scaling cylinder is an imaginary cylinder extending the scaling length of a log segment with identical diameters on both ends.

LOG DIAMETER MEASUREMENTS:

The Scribner log rule measures diameters on the one-half-inch rather than the full-inch.  For example, using a standard tape measure, a scaling diameter of 10” would be any diameter that measures between 9 ½” to just under 10 ½”. The minimum top diameter normally considered in scaling is 6” (5.51 actual inches).  When the narrow-way is less than 6” (5.51 actual inches), the log will be scaled back to the next shorter log length that meets the minimum top diameter requirement (this shorter log length is reflected in two-foot multiples with full trim).  Log segmenting will then be done using this ‘new’ or ‘cut-back’ length.

When making diameter measurements, always remember the following:

·         Diameters are measured on the smallest point on the log.

·         Measurements are taken inside the bark.

·         Measure through the true center of the log.

·         Disregard all abnormal bumps and depressions (such as knot clusters, swells, or broken ends).

Diameter measurements are taken by finding the narrowest way first.  If all logs were small and round, one measurement would probably be all that was needed.  However, trees grow in a variety of shapes. When logs are delivered that are odd or oblong in shape, a second diameter measurement is needed. The second measurement is taken at a right-angle (90 degrees) to the first (narrowest) measurement. If one diameter measurement falls exactly on the half-inch, raise it to the next higher full-inch.  If both measurements fall exactly on the half-inch, raise one and lower the other.  The two measurements are then added together and divided by two.  If the final calculation ends in one-half, the one-half is dropped.  As an example: a log with a diameter measurement of 12” the narrow-way and 15” at a right angle, has a scaling diameter of 13”.

LOG LENGTH MEASUREMENT:

Acceptable log lengths are generally in two-foot multiples, plus 6” for trim allowance per segment.  The maximum scaling length for a single segment log is 40’ plus 8” trim (when scaled in 2’ multiples, 12” trim when scaled in 1’ multiples).  When logs exceed 40’ they are scaled as two or more segments, with the length of each segment being as close to the same as possible.  On a butt-cut, measure from the shortest side on the small end to the point where the scaling cylinder emerges on the butt.  Second cut logs are measured from short side to short side.

LOG TAPER RULES:

To improve productivity, handling, and storage capabilities, logs are frequently manufactured in lengths longer than 40’ 8”.  Since log segments are scaled with a maximum scaling length of 40’, it becomes necessary to obtain a small-end scaling diameter for any other segment(s) within the log.

DEDUCTIONS FOR DEFECTS

There are four types of defect deduction methods used in scaling logs.  These methods are used to arrive at the net scale volume of a log by applying a given set of rules and procedures.

Since lumber is usually sold in two-foot multiples, the net scale of a log is also determined in two-foot multiples.  Any defects that would result in lumber length recovery shorter than six feet are treated as if they affect the entire length.  Each log segment is always scaled on its own individual merits.

4.                     Customers (OSU Extension; www.cof.orst.edu) This list has been edited to show customers in the NW Oregon, SW Washington area. If we had some high value logs to harvest (peelers or poles/piling) then we could afford to ship further.

5.                     Logging Costs

There are several factors that influence logging costs:

·                      Terrain (steep terrain is more expensive – may require cable equipment instead of skidding behind a tractor)

·                      Haul distance to mill – it costs approximately $60/hour to hire a truck and driver. Say, if the average round trip is 3 hours, the cost of hauling will be in the neighborhood of $60 per MBF or $7 per ton.

·                      Road building costs, in some cases, roads will have to be constructed or improved (replace culvert or add rock).

·                      Market – if business is slow, loggers will price their services more aggressively.

The Oregon State Dept of Forestry uses $210 per MBF as a rule of thumb for logging costs. RTF experience seems to indicate that this guideline is pessimistic. Prices have ranged from $110 per MBF ($16 per ton) to $250 per MBF.

6.                     The Business Model

Note: RTF does not have a “steady state” situation. There are 32 acres of mature standing timber that is ready for harvest now. The remaining acreage is young stands that are at least 5 years away from generating any revenue.

7.      Other Issues

·        Identification of property lines and corners

·        Consulting forester – Mike Barnes

·        Access to properties

8.      How do we spend our time

·        Plant seedlings (planting is contracted for large areas, with help from consulting forester; we take care of small areas, fill in “holes” etc.)

·        Weed/grass control – spray herbicide (most conifers aren’t affected) to reduce competition, which promotes seedling growth

·        Prune double tops – deer & elk browse seedlings which tends to create more than one leader

·        Establish and maintain growth plots

·        Thinning (pre commercial)