EP58:What to expect during a timber harvest on your homestead

hello everybody welcome back to red tool house down here in the barn in the dark because I wanted to put a bumper on the front of this video just to talk about this is the last video of the year for 2017 as this video airs it'll be December the 22nd we're taking that next week off between Christmas and New Year's but we will be back New Year's Day with a new video and really excited about all the neat things that we've got coming on waking up the pigs here they don't like me talking when I'm after they've gone to bed if you want to know what we're kicking off the next year just go back to the video here a couple days ago where we referenced updates and all kinds of things going on but this video today is a it's kind of a long video so I apologize for the length but I left it long simply because all the good information Jeff was giving us concerning how a timber operation actually works when it actually comes time to harvest timber how the process works so I wanted to leave all that in I apologize that it was just a single shot single angle so it's you know it's kind of kind of a long way to watch a single angle but those of you that have expressed a lot of interest in understanding more about timbering I wanted to leave all that good info in because it answers a lot of questions you all have posed so be sure to check that out and we hope everyone has a Merry Christmas and Happy Holidays and again we will see you again on New Year's Day [Music] hello everybody welcome to red tool-house as you can imagine it's Jeff and I still standing in the woods appreciate Jeff being here if you're curious as to who Jeff is go back multiple episodes and you'll see the introduction to Jeff Jeff's a good friend of mine he's a forester has 20-some years of experience in 25 25 I don't want to make you too old there lots of experience in forestry and it's one of those things where you have somebody that this is knowledgeable in a subject do you get them on the homestead you don't want to let him go so I'm making him stand out in the woods as long as possible but in this video we wanted to talk about the actual steps to expect when you have your property timbered if you look at the last episode where we talked about why should a homesteader even consider timbering this kind of adds to that it kind of gets a little bit deeper into the details there so Jeff welcome back again a very appreciate it did be but so we're talking about we're talking about timbering so as we've mentioned before I always preface this with if you're going to have your land timbered you need to hire a forester like yourself to come in and oversee that again just give us a 40,000 foot elevation as to why Forester is important in this deal okay well like we we touched on a little bit before as far as you've got two main components the financial component and the land management and forest management component it kind of combine those into one you need a plan to execute to put that all together and then once you that's from a marketing standpoint we like and your land management standpoint we'll generally call that your terms of sale when you go in to start to formulate a contract with a buyer from the from the financial standpoint there are multiple ways and I'm trying to put this as simply as possible in a somewhat complicated scenario but there are multiple ways that you can you can sell timber okay you can from you know from from a price standpoint from how you're paid from your payment terms you can you can sell it lump sum which if I recall I think you told me that's what you did here yep that's always a good option yeah you can do typically what's called a pay is cut that's that's not necessarily a bad option but there's just a lot more things to look at pay is cut is when you're actually paid as the landowner not not upfront but when the trees are are cut and and and you know removed and delivered to to the buyer so you can do kind of a hybrid combination of of some money upfront and then I pay the tax is a credit per se and then you're paid as that credit is depleted let's say you sell $50,000 worth of timber and you might get a credit of half that down you know maybe so so as those loads go out we track those if we do that type of sale and then once that credit is depleted then then you get paid on that so various ways to you know various ways to sell timber and then there's various there's various markets for for different products that you have to evaluate to it's kind of this whole matrix of decision making so that so it sounds like that complicated element of that though is is discussed well with with the Forester at that time impressive good so so let's let's start at the beginning so we'll use this as a scenario so we're standing on my North Ridge about 50 acres of land here all hardwood there's there's no clearing at all on this side so if I was ready to timber and that's how I can't stress enough people if you're going to do this hire a forester so I was obviously pick up the phone and call my buddy Jeff and say Jeff it's time I wanted timber and again we know there's a lot more to this but in this simple scenario I would say I'm ready to timber I want to have my timber cut so if in that situation where if I haven't had you out here before then the first thing the brokers going to do is what's the first step for the broker we're going to first thing we're gonna do is you're going to tell us really what areas whatever you that you want your timbering doesn't set limitations yeah don't go out of the box set the boundary a lot of landowners don't know that they can do that they think that you know if they sell timber it has to be on the whole place you do have to have a certain amount of volume on a certain amount of acreage or you know we just can't be a commercial operation I mean yeah we can't get a logging contractor to come in and do it yeah but we you know you you set the boundary now you know if if once we get out there you know that boundary might be adjust a little bit based on some economic surgery but you generally not much probably not within you know five or ten percent of the total acreage or whatever some of that depends on access and then some things so you set the boundary and we agree okay we put that boundary on the map an hour working maps whether the topo map Aero photography on GPS that is for the purpose of doing the inventory okay we've got to have that inventory data to be able to provide it to the industry you know for your sale plus I mean obviously you know you need that you need to have to know what you're selling so so we come out and we do the inventory there's there's two primary ways to do that one is what we call statistical sampling where we take sample plots and we estimate generally within a plus or minus seven or eight percent definitely within a 10 percent component of the standing volume you know that's out there that's that's called a timber Cruz okay the other way is to actually come out and tally every tree okay that's called a hundred percent tallies you're actually gonna look at every tree you look at every tree it's a lot more labor-intensive obviously we're not sampling but we generally recommend that for because that's more cost involved in that because it's more time but we'll generally recommend that for more higher quality stands yeah we're very intensely managed stands for the future yeah and actually that's that's what happened with mine seventeen years ago they did a hundred percent inventory yeah again for those of you who don't know I didn't Jeff 17 years ago so obviously would have hired him had I done that so in that situation so so the the Forester comes out and he's taking that inventory and I just remember this vividly in fact I still have it in a file cabinet there's a spreadsheet I was given and it was a species breakdown calculated board feed out of all that so that is that's that data that you keep talking to me about that that's when guys gathered yeah so the foresters gonna have this incredible amount of data that he's going to calculate and of course that is almost like your your product list that's your inventory list of what you're selling then to the actual logging company it's it's a it's a it's it's it's a beautiful thing actually and and we try to keep it as simple too you know it's it's a data table that basically on the left side you've got your species okay and those are you know your primary your Oaks your red oak your white oak your chestnut oak you've got yellow poplar your maples ash Hickory cherry walnut to all those species and a few more on the left side and then you know to top you've got your size classes so you know if you're starting your say let's say let's say 18 inches in diameter a chest height this tree here is about a you know it's about a 16 inch so you'd be starting a little bit above that yes this white oak may or may not qualify but the the maple right beside it definitely would definitely so that's yeah about like 10 inches in diameter so that guy would leave him alone yeah so we talked about this a little bit or you just you just mentioned something about size so as a property owner I can actually tell you the Forester say I don't want anything cut less than 16 inches or 18 inches or I can specify a diameter correct you can and then we'll verify whether or not you're within the market commercial operations yeah yes I mean you say all about 30 inches and you know we only got two trees on the whole property of the 30 inches may give you may give you a good principle and this is something that we developed over the years to that actually landowners can do themselves you know and you know come out just like we are right here but if you look at an acre being approximately you know 200 by 200 sight distance an anchor is about a football field right so but make a square and if you kind of look around your woodlands in an area that you're considering you know having timbered and you have anywhere from 20 you need about 29 maybe 18 I'm low in but 20 to 25 trees you know cut trees per acre in this area now in other areas of the country you can probably go a little bit less okay you know be a little bit more selective but you know if you kind of use it as a guideline and then to add to that trees of this size like this hard maple sugar maple right here and bigger you know you'll have a total you need to tell you won a total of about 60 counting your trees that you're going to be cutting of about 65 trees this size and bigger per acre and that's your next rotation after you take out after you would harvest say the 20 that the bigger ones thanks yeah okay so so the Forester comes out does all this inventory we've got a great inventory list we set parameter the property owner of set parameters the foresters vetted all those to make sure they jive so there's enough inventory there to justify a sale what happens next you use a forester then pick the logging companies how does that work we we don't pick per se we don't go out individually normally we have a couple methods that we will put the picture timber to market one of them which is been used for years decades in the industry here and in most states is what's called a sealed bid you may ran that sealed bid timber bid is when we use our database of buyers tailored to the specific location of the timber for sale meaning that I can't get a buyer 200 miles away two truck logs that far so you've got to work within your wood basket of available buyers okay it's here so so we know that we know you know for any particular track who the potential pool buyers are and it may not be just a radius or circle around your track it you know it can very based on what you've got so anyway we can either do that in a bid scenario that means we give them about three to four weeks to come out we give them the data the tabular data we were talking about we don't give them the price data though okay we don't give them we don't give them that appraisal information is between us and our clients exactly so we give them the inventory data and we say hey fellas on this day at this time you know you deliver your sealed bid and an envelope for this timber that's a sealed bid we open them up we announce them generally to them - and out of courtesy and you know we see who the winning bidder is yeah but in that situation the winning bidder that that's always something that at least as simple as I am to wrap my brain around you're obviously looking for the best price as far as the the whole the landowner concerned not the lowest price from the logger oh yeah it's a reverse bid yeah yeah lot of people if you're in the construction business or or any business that you're bidding contractor you're trying to be the low call it's so that's where you again underscoring the fact you the Forester are representing the property owner because you want them to get the maximum amount of money out of that so so when you open up all those bids and say okay this guy was X but this guy's X plus 2001 and honestly that's why a majority of foresters the vast majority of foresters do sales on a commission basis is because the more that we income we produce for landowner the more that we also participate in that income caring if you want to call it so I get you get me more money obviously you got very and and and getting back to the competitive nature of all we try to drive as a marketing opportunity okay the the bid pretty well epitomizes you know all that opportunity and all that competitive nature now there's some tracks for various reasons that we can't bid and some of those reasons might be that we've did our market analysis and we pretty well what you what you'd normally don't want and when you do a bit scenario is to have probably less than three bidders okay if you get down into mark region that you don't have a big buyers pool bid may work against you especially if you just say get one bid and that that particular company that was that they are the a little bit and we've been there before now we didn't sell it but we basically call those negotiated sales yeah and that's where we'll go out and with approval the land owner and you know we'll bring the buyer pull in and will sound and say hey this is what we think this value is worth based on all of our analysis and our inventory and appraisal and what the markets are doing right now in particular species and you know we will negotiate the sales so and then we'll also do a in some circumstances they and this has changed this is kind of important here in West Virginia and other states to dynamics has changed more over the last yeah probably since the recession in the hardwood market is that and it's it's basically just from a cash flow standpoint for business for sawmills and operators but they're a little bit more inclined now to put better prices out there for sales if they can spread their cash flow out a little bit cause anytime you know they're if a buyer is paying you lump sum that's money out of their business that they don't have to do something else so if they can spread this cost out so we're doing more some more advanced credit paying then you know Pascal okay okay so the sealed bids have been opened winners been declared so the Forster job is done then right no no no no forces kind of always around so now okay we yeah we've got her we've got a high offer and whether it's bid or negotiated I mean as a landowner you're in the loop every step of the way we're not you know but we've got we've got our buyer now we've got to set the terms of the the timber sale contract everything that you want to do from a financial payment you know standpoint to land management standpoint to risk management as far as liability you know avoidant if something happens out there from a liability standpoint all that needs to be incorporated into the timber sale agreement now you know as a preface you know I'm not an attorney you know we don't we don't give you no legal advice as far as contractual vais but what we do is we prepare a pretty good template contract that with those terms that you you know you pretty well fill in you know the rest out with the with the specific terms so you know within that template agreement there are those provisions in there obviously the payment terms obviously you know that the longer has to be licensed certified that's the longer that's working to cut the timber for the purchasing company but the purchasing company is fully insured in all aspects you know all those provisions are covered as far as property boundaries making sure that your mark the risk there you know kind of the tree on somebody else so very comprehensive contract it's about five or six pages but it's a lot more comprehensive than you're normally gonna get just from you know a buyer coming knocking on your door type scenario yeah so then we take that contract that usually takes now I'll say generally from the time that we know we have a buyer and to the time we get to contract ready and closed about two to four weeks depending you know then we schedule a closing it's not it's not like a real estate closing you don't sign your you know stock good document basically signing the timber sale agreement oh and we're executing whatever the payment terms are at that time upon closing and we're also getting an indication of when a lot of people think well if I sign a contract they're gonna start logging tomorrow normally not the case a lot of our sales they may not they may if we close the sale let's say this time of year in October almost November they may not go and come in to log it until maybe May or June of the next year okay so and that could be specified in the contract because I know in my car tracked the the logger had a two-year window to cry if a timber and he actually showed up about the 20th month to start harvesting so yeah so that you know that's yeah well that was a little inconvenient for me it obviously you you it is a contract it is a partnership it has real business relationships there's got to be some give-and-take there so the contract is signed and and all those stipulations are in you've really represented the property owner well there so the first day that the logging crew shows up and starts running us all then you're done right well no you know that's when the harvesting starts and and we called harvesting is you know you caught logging it's the same thing but harvesting more of a kind of a better description usually because of the things you're doing out there there but once that starts then that depends on our services contract some landowners one it's out there more than others so that's part of our service contract as far as how often we come out but we're always there to make sure that you know the they get started in a good manner as far as where their log landing locations are and the road layout and all that stuff it's just a good introduction period because the landowner gets to meet the logging contractor you know all those things you always want to do that so we make sure the jobs kicked off good generally we'll stop by you know every couple of weeks or what-have-you if there's an issue that needs to be addressed between the landowner and the purchaser or the logger we are here we're on-site most of the time we're dealing yet we're dealing with the logger but we're also dealing with a procurement Forester for the company that purchases so you got a bunch of you've got a lot of heads in this thing so if we've got an issue I would will typically get together with the Forester representing the company and we'll get that issue resolved okay cool so it's safe to say that a Forester is going to provide oversight of the project as it goes along to whatever degree is specified in the contract right so so the guys are cutting trees down that they're supposed to I know in my situation where we did 100 in inventory our Forester actually went around and painted little dots on every single trunk and so when the project was done he went around and counted stumpage so I shouldn't you know I made 140 some dots I should have should see 140 some stumps is that still practical is that we do it at the same time we'll put a when we mark the tree we'll put actually three spots we'll put one on the downhill side and one on the uphill side and we'll put one on the stop okay so on the mark sale if we've got any tree stumps out there without a spot on you know then we know that there was a tree that you know shouldn't probably shouldn't have been cut yeah we normally don't run into that problem sometimes the landowner will you know when you do sometimes there's trees removed for for road construction that are smaller those trees that you know sometimes will get damaged from a larger tree you know coming down on if it breaks if they try their best and they still like to say the top of a little white oak you know say ten inches in size then I'll leave that up to the landowner most of the time lanterns or does what we call a snag and you know so we may have them just go and cut that snag down yeah I can utilizes pulp or whatever yeah I'm good so so let's let's fast-forward to the last load of logs has taken off the property what does the land what should the landowner expect I mean obviously we've talked about we know works been done dirts been moved trees have been have been dropped so it's not like the properties exactly the way it was before it started but what can a landowner expect the the scars if you will what are what remained after timber project once the last trees been dropped and loaded on the truck and they're still got their equipment here especially a dozer they've got to do the reclamation work okay some a lot of loggers now they'll kind of do that as they go they'll kind of start closing down you know and not all not have to do it all at one time but regardless of how they do it you know as far as best management practices they've got to get certain in any road segment that's that's greater than 15 percent grade or crosses a stream those ought to be seated if landowners got specific provisions as far as the wildlife food plot mixes on the roads you know the seed those the landing has to be smoothed off make sure the water drainage is all that so the reclamation has to be done the aftereffect actually out in the woods that a typical landowner will see you will see some slash debris left you in some cases if your PUD markings aren't very good for top wood you'll have you know more than slice you'll have that tops you know out there yeah so like mine 17 years ago they're not taking anything right so there was all kinds of tree tops so I had tons and tons of firewood right so in that in that point - this is where the the Forester really helps back up a little bit to the contract because the situation I ran into was that the guys that were were timber in my property the guys they actually were doing the cutting these guys were taking out truckloads of firewood so they were taking the bud offs and the tops and they were cutting splitting the firewood now in my mind I'm thinking well that guy he did buy the tree but he's just by the marketable part of the tree so those are the type of things that in the contract kind of specified saying no you don't take any of the tops or he says well no I've got a pulp wood line I need to take all this out so those are the type of things to look at and what we're talking about that one thing to point out to our viewers in that same point of the contract you talk about these provisions again this is a business relationship so there's a partnership here that you're striking with this with this timber company that's coming in but if you keep that relationship intact you keep it honest you keep it above board then when they have this equipment in again from a homesteaders perspective I love the ideas okay you're doing reclamation you've got a dozer in here even though it's not in the contract saying hey would you mind making a berm here or making it that's an L or a pond or any of those type of things and you know you're gonna get more flies with honey in that situation so if you keep that business relationship in there that's a great point and I'm glad you brought it up from real standpoint because you did it but yeah you know we've sold a lot of tracts of timber for for various types of landowners and and and you know people are people you you have all different personality types but but you will get much more done in my experience I mean not everything that they do that the loggers do per se you're going to be absolutely you know you know there's a lot going on and not everything's going to be perfect okay you know they might break a few more trees out than than what you expect it or you have that you had the firewood issue that you know came up but if you're exactly right if you get along with that you get to know your logging contractor and you get along with them and don't make a mountain out of a molehill over things that when you walk out here you know two or three years later you know you know it's not gonna make any difference you know from a land standpoint but yeah you normally can get a lot more things done that way because they do have the equipment on your property and if they're like and you get along pretty decent now that doesn't mean you get you know roughshod over but you know but good very good yeah good well anyone and then looking at what to expect when you're done 17 years ago this was actually timbered yes we're standing on property that was timber to 17 years ago and I did a selective cut we did 16 or 18 inch diamond or higher I have to look and see it my paperwork so it does regenerate very quickly and I will say and we talked about this in one of the previous videos about the benefits of timbering grouse and Woodcock population boom just just went up right after that because they had two habitats in those treetops wild turkey all of that you really kind of built up now over the past 17 years the coyote of taking care of that issue they have been does out quite a bit but so there is a you may say well it's not pleasing to the eye to go through the forest and see some of these treetops down again if you burn firewood you got tons of firewood sources there but you're actually creating habitat for some wildlife that will benefit from that rabbit all of those type of things can really increase and again a lot of these tops I mean you can see yeah you don't see a single top laying around now you're exactly right and and what we try to stress with landowners is forest management especially hardwood management we don't necessarily you know in the age we live in everybody wants everything immediately and you know you want you know whatever you put whatever you're buying or whatever if they're doing landscape job at your house or or home improvement or whatever look at us I mean look at them more as a temporary kind of a site inconvenience those treetops yes they don't look they just look like they shouldn't be there because you know doesn't look natural but in addition to creating a wildlife habitat and that for services actually did Studies on this in the South where they do more plantation management and they remove those treetops because they have better public markets and they have different markets than we do here they're actually getting a soil depletion now because those nutrients aren't being added back so when you put a tree top in there and all that bow to all that biodegrades in there you're adding so much not just nutrients but all the the microorganisms and everything that these trees need to thrive out here and it's just it's just the whole food chain yeah so yeah so on your home set if you have a stand of timber and you think it has some value to it don't just run away I think I can't timber because it's going to tears too much stuff up look at getting a forester in there have that consultation let them take a look at it and say hey yeah there's there's potential here do research again just like you'd hire a real estate agent or you know you go to a car dealer or whatever you're going to want somebody that has a reputation a good reputation foresters have good reputations and I'm sure there's something probably they don't have a good reputation so so you want to find a reputable around get references those type of thing but just know that that guy or gal is going to represent you the property owner so check it out get him in there and and we've talked about all the great benefits that come from that now having your timber harvested maybe isn't for everybody but if you if you're going to go down that route then a forester is kind of a no-brainer and I think Jeff's done an incredible job and really appreciate you coming here and talking about this and explaining all the details of it and man I want to I want to start redoing things around here so I cut the stuff down and getting some pasture up with that and do log trucks in here no but if you want to find more for me not about Jeff and his company you can visit WV land group.com and jeff has been very gracious to say even if you're outside the west virginia area that's outside of his business market you can use his website use this contact form you can ask you some questions again he is out in the field a lot so you may not get back to you immediately but send him an email question through the contact form and he'd be more than happy to answer that but check that out you considered consider looking at a forester for your timber needs there so man I appreciate it thanks again for your time enjoyed it thank you very much Gareth

Channel: Red Tool House - Homestead

Views: 14,786

Rating: 4.9537039 out of 5

Keywords: homesteading, homestead, farming, pastured pork, self-reliant living, how to homestead, timbering, logging, selling timber

Id: s3k-5uxpPaM

Length: 30min 41sec (1841 seconds)

Published: Fri Dec 22 2017