Continuing the debate on how payment for timber is measured, forest owner Digby Guy responds to Neil Gray’s recent article on the problem of the ‘angel’s share’.
I was much encouraged by the article on 'the angel's share' in last month's Journal. I believe the phrase relates to the mysterious loss of alcohol when whisky is matured in barrels. The only point where I disagreed with the writer's otherwise most excellent article was in fact his reference to 'the angel's share', because there is nothing mysterious about where the weight loss in timber goes. Where there are winners there are also losers and, in this case, the losers are the forest owners and the harvesting contractors.
Selling wood by the tonne is, of course, a nonsense. Sawn timber is traded by volume the world over because volume is consistent, irrespective of moisture content. When building your garden shed you do not buy the 4x2s from Jewsons by the kilo. However, the lower the moisture content the more timber the miller gets for his money ¬– or, to put it another way, the less money the forest owner gets for his wood, albeit the same volume of wood, and the less the contractor gets paid for his work. Profitability should not depend on the lottery of moisture content. Contractors are pressurised to work on tight margins; margins that are eroded further by weight loss, which is not in their control.
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It is quite common in the summer months for timber to lose 10 to 20 per cent of its weight between felling and going over the weighbridge due to delayed uplift. Taking harvesting and haulage costs out of the equation, that would represent a net financial loss of maybe 25 per cent to the grower. This loss is mitigated by the haulier having to haul more m3 for the same money and the harvester having to cut more m3 for the same money, as they are both paid by the tonne. The loss is borne by grower, harvester and haulier alike while the benefits go to the processor. The longer sawlogs are stacked at roadside between April and September, the more money we lose. Would the forest contracting industry be in a better position if it got a 15 per cent price increase? It’s that simple and that obvious. I sometimes wonder (though I would never put it in writing) if building stocks at roadside might be a strategic decision. Perish the thought.
As a forest owner, living on the spot, and part of what I might loosely call a harvesting and marketing co-operative, I do all I can to limit the financial implications of weight loss, but would still much prefer my logs to be sold by volume. Not many forest owners live on the spot and have that option.
Ironic to think the timber harvesters and hauliers in the west of Scotland that forest owners so depend on could be put out of business by another summer like the last one.
Good summers are when contractors should be making money, building up some fat to see them through the winter. Summers in the west are getting warmer and drier, so it's an increasing problem.
We need to move the machismo focus from the number of tonnes an operator can cut in a week to the quality of the job done, including the level of wood recovery and the state of the site left for the next man. Selling timber by weight is a nonsense and one that’s heavily biased against both the forest owner and the timber contractor.
When I started in this industry, all sawlogs were sold by volume. Any wood sold by weight was hot logged to minimise weight loss. The concept of selling sawlogs by weight was too ridiculous to contemplate. We never saw timber stacks the likes of which we see regularly today. It’s now common place to see stacks at roadside of several '000 tonnes.
Why?
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I think there are three fundamental reasons. Firstly the owners do not have control of forest operations and are more often than not oblivious to the weight loss issue.
Secondly, the contractors are more aligned with and dependent on the wood processors than they are with the forest owners and thirdly, forest managers are too often conflicted. Time for change.
Nearly forgot to mention the pitfalls of ‘weighted average price’, but that’s for another day!
What do you think? Share your thoughts by emailing editor@forestryjournal.co.uk
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