A while ago, we mentioned that one of our passions is to see our clients benefit from the hard work and patience they’ve put in to managing their woodlots and forests. Though certainly not the sole purpose for owning a woodlot, there is a sense of satisfaction when a landowner sells some of his/her timber for a good price. We have always held fast with the notion that landowners benefit mostly when selling their timber through the bidding process.
Under a “sustainable management” scenario, the harvesting of timber isn’t the final action a woodlot owner takes, but more of planned, recurring process designed to improve the health and value of the residual woodlot while at the same time receiving a financial return on the investment the landowner has made. The nice thing about having timber as a “financial” asset is that if it’s not converted to dollars by selling to a mill or logger, it continues to grow, usually increasing in volume and quality (and subsequently, value) over time. This gives a landowner flexibility in timing a harvest for an income event.
Up until recently, we’ve seen stumpage prices (the price of timber standing in the woods) languish for several reasons; the tariff/trade war with China and the economic slowdown caused by the COVID pandemic. Timber was still being sold for a variety of reasons, and decent prices were still being paid for specific species and grades but, in general, it was a tough time to sell as a landowner.
We’ve certainly seen a resurgence in demand for hardwoods recently, as international markets (China, Vietnam, etc.) and domestic markets have improved. Though in some areas there is still a need for additional workforce, many mills are operating at, or near, full capacity again, and their orders are coming in on a fast pace – of course, this eventually translates to good news for the woodlot/forest landowner who has timber to sell.
Our bidding activity has consequently picked up significantly, and we’d like to share with you a few of the many bid sales we’ve recently administered for our clients. Below are a three recent bid opening results (redacted for privacy) since January 1, 2021 to illustrate the results we are seeing.
These are just several recent timber sale examples. Please keep in mind that results depend on a variety of circumstances; quality of timber, access conditions, and prospectus terms are just some of them. The timber markets in our region remain very active and hot, and we will continue to bring more insight into bidding results in subsequent posts.
If you have timber you may be interested in selling, and want a long-standing professional forestry firm representing your best interests involved in the process, please don’t hesitate to call any of our FORECON offices. Our foresters would be very happy to speak with you about the markets, and more importantly, your goals and objectives for your land.