Driving Down Production Costs Key To Surviving Poor Timber Markets

With timber prices roughly the same as they were in the mid-1980s, how are tree growers surviving in today’s markets?

That’s the issue Marshall Thomas, president of F&W Forestry Services, one of the nation’s largest forestry consulting firms, tackles in his firm’s fall newsletter, the F&W Forestry Report.

Comparing tree growers to computer manufacturers, Thomas says forest landowners are making it today because they have driven production costs down.

“Given that we can’t control timber prices, perhaps we need to recognize where our success has been and focus on that in the future,” Thomas writes.

Thomas notes that landowners have reduced costs related to site prep and herbicides but have also been utilizing more advanced silvicultural practices and genetically-advanced tree seedlings, resulting in a significant increase in overall timber productivity.

“So we may need to recognize that success in the face of low prices could be based on continuing to spend money in the right places, and by increasing expenditures in some cases—as long as the additional expenditures increase yields enough to drive down overall cost per unit,” Thomas concludes.

TO SEE THE FULL ARTICLE IN THE FALL 2017 F&W FORESTRY REPORTSUBSCRIBE NOW