Pacific Northwest Research Station

Title: Potential for small-diameter sawtimber utilization by the current sawmill industry in western North America.

Author: Wagner, Francis G.; Keegan, Charles E.; Fight, Roger D.; Willits, Susan.

Date: 1998

Source: Forest Products Journal. 48(9): 30-34

Description: New silvicultural prescriptions for ecosystem management on both public and private timberlands in western North America will likely result in an influx of relatively small-diameter sawtimber for processing. Since sawmills currently process a majority of sawtimber harvested in western North America (more than 80% in some regions), this study concentrated on determining the value of small-diameter sawtimber delivered to sawmills. Data were collected during the summer of 1997 to describe a representative random-length sawmill and a representative stud mill for the inland region of the United States. Data included inputs for machinery, mill layout, machine speeds, volume and grade recovery, product prices, and fixed and variable manufacturing costs. A simulator (MSUSP) was employed to describe the sawmills and to determine delivered-sawtimber values by stem diameter for each mill. The value of sawtimber delivered to a sawmill was based upon a 25 percent and a 10 percent return on investment (ROI) capital and upon covering only variable costs of production. Results showed that sawtimber under 9 inches (23-cm) diameter at breast height (DBH) could not cover harvest and delivery costs and earn even a modest ROI capital at sawmills in the region. The 6- and 7-inch (15.2- and 17.8-cm) DBH sawtimber harvested from steeper slopes would require substantially higher lumber prices to cover variable costs. Results indicate that small diameter sawtimber may have to be subsidized to allow for profitable manufacture of products by the current sawmill industry in western North America.

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Citation

Wagner, Francis G.; Keegan, Charles E.; Fight, Roger D.; Willits, Susan.  1998.  Potential for small-diameter sawtimber utilization by the current sawmill industry in western North America..   Forest Products Journal. 48(9): 30-34