Forestry Basics

This will help in learning to estimate the value of your woodlot using Stumpage which is the most common term landowners will hear when speaking of selling timber.

To estimate the value of the trees in your woodlot, woodlands owners need to be able to assign a value to each tree while it is growing in their woodlot. This value is referred to as “stumpage value” and by definition it is the value of the products (firewood, pulpwood, and/or lumber) that can be obtained from each tree at a processing plant or sawmill minus the cost of harvesting, transportation to the mill and conversion to an end product such as lumber. In addition, each contractor can be expected to include a reasonable profit in operating their business. At first glance this seems as though it would be a difficult undertaking, as most woodland owners may only harvest once in their lifetime and are not in the business of tracking mill prices and harvest costs. An easier approach is to obtain stumpage prices for other timber sales that have been reported for you area. Before we discuss how to obtain these estimates for stumpage prices, a short discussion of the factors that affect these prices would be in order:

 

  • Current Market Trends: Just like any other product on the market, timber prices fluctuate regionally, from year to year, and within the year. Timber supply, manufacturing needs and weather conditions can affect current stumpage prices.
  • Woodlot Location: Stumpage prices vary within a state and are usually reported for multi-county areas commonly referred to as price regions. One would select those prices based on the price region closest to your woodlot. In addition, since transportation and harvest costs are part of the stumpage value equation, those woodlots closest to a mill or processing plant and those with good access (close to existing road networks) may obtain slightly higher stumpage values.
  • Woodlot Size: Since the timber harvester will have to move equipment to the site, the woodlot must be large enough to offset these costs and still provide the timber operator a reasonable profit.
  • Tree Species: In the Appalachian hardwood region, stumpage values are usually reported on a species basis. Black cherry, sugar maple and black walnut are usually our most valuable species while blackgum, beech and hickory are of lower value. If you do not find one of your tree species in the stumpage price list, consider using a species in the list that is similar in shape and wood characteristics. For example, many times basswood and cucumbertree are sold at prices similar to those for yellow-poplar.
  • Tree Size and Grade: Refer back to Lesson 2 for specifics, but as a general rule larger trees and trees with straight clear boles free of defects, may bring higher stumpage values.
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