Category Archives: lumber

How Oregon Rivers Carried Millions Of Trees Into Production

How Oregon Rivers Carried Millions Of Trees Into Production . News | OPB.

Around the same time famed photographer Carelton Watkins first captured the Columbia River Gorge with his traveling darkroom, on the south fork of the Coos River in southwest Oregon a large dam helped fuel Oregon’s burgeoning timber industry.

The Tioga Dam was the largest splash dam in the Northwest. It was the first of what would grow to become 230 splash dams throughout western Oregon.

Let’s start big picture. From 1849-1924, Oregon produced over 47 billion board feet of lumber production, most of it hauled out on rivers. For context, trucks carried about 4 billion board feet lumber out of the woods on forest roads in 2014.

The Tioga Dam on the South Coos River towered 52 feet high and 200 feet wide.

Stephen Dow Beckham

In the past, ax men would cut down the towering trees and guide them into flooded rivers, which were controlled by splash dams. When ready, the splash dams opened and the wood rushed down in log drives. Workers would use dynamite to carve out natural objects in the way and clear backed up trees.

The river could carried off around a million board feet of timber in a single drive.

Oregon’s years of log drives ended with the Tioga, as the last standing splash dam in Oregon. Under pressure from the state and landowners, it closed in 1957. Workers burned it down in a night.

Many of the rivers changed by the log drives have healed over the past 70 years. But there are some lingering challenges.

Oregon Field Guide explores this history and what means now for some rivers in Oregon

Leave a comment

Filed under lumber

NRR: Lumber, log prices up. Home recovery expected to rise for next 3 years

Lumber, log prices up. Home recovery expected to rise for next 3 years

 

December 23, 2013

Timber Industry Report
By Rick Sohn PhD.
Umpqua Coquille LLC

Mills are competing for logs and prices are rising. This month is good for homebuyers, including a slight drop in Median Home values and a big drop in interest rates. Seven-year trend of lumber, logs, housing, and mortgage statistics are shown below.

chart-duy-dec13

Interpretation

Lumber and logs are both in nice rising price trends. Logs are climbing into a winter price range as mills compete for a limited supply to fill inventory. Economists say we are in a recovering housing market that could last another 3 years anyway. Expect to see continued strength in lumber and logs through the winter and beyond, with seasonal dips.

Building Permits were reported up to a record high level for the year, and as the media likes to say, finally recovering to the 2008 levels. That is NOT saying much. You will hear comparisons to 2008 a lot, since it was such a volatile, falling year. The 2008 high was 1.2 million permits and the low was 554,000. We will have made some real progress when housing and other stats are compared to 2007, or better yet, 2006.

The weekly average for 30-year fixed rate mortgages is bouncing around. It was at 4.57 the week of Sept 13, but dipped as low as 4.10, in the first week of November, and now is at 4.22. It is bouncing around these low levels.

At the same time, the Zillow report shows clearly that median home prices have plateau’ed and have started to dip slightly. The high for this cycle was August’s $163,000 national median. This mirrors the data for Portland from the Regional Multiple Listing Service data which also shows a home price drop, and reduced inventory of homes for sale, which fits the season. This is all very favorable for homebuyers.

In speaking with one local producer who sells into the European Clears market, recovery in that market has yet to occur. This coincides with the generally lackluster European economy, which is has worldwide impacts.

For the second month in a row, Housing Starts are not reported, due to the Government Shutdown. Data “Does not meet Production Standards.” According to the US Dept of Commerce, the results for September, October and November will be reported on Dec 18 – lets hope for a pleasant surprise.

Data reports used with permission of: 1Random Lengths. Kiln Dried 2×4-8′ PET #2/#2&Btr lumber. 2RISI, Log Lines. Douglas-fir #2 Sawmill Log, Southern Oregon region. 3 US Dept of Commerce. 4Regional Multiple Listing Service RMLSTM courtesy of Janet Johnston, Prudential Real EstateProfessionals, Roseburg, OR. Portland, Oregon data. 5Freddie Mac. National monthly average. 6Mortgage-X, national average, most recent week. 7Zillow.com, National Median Issue #6-11. © Copyright Rick Sohn, Umpqua Coquille LLC please e-mail rsohn@umpquacoquille.com

Leave a comment

Filed under lumber

AFRC: Timber seeks injunction barring contract suspensions

Timber seeks injunction barring contract suspensions

October 16, 2013


By American Forest Research Counci
l
Timber Industry Seeks Injunction Barring Federal Government’s Suspension
of Timber Contracts

Purchasers of federal timber sales and stewardship contracts filed suit yesterday against the Forest Service and the Bureau of Land Management (BLM). They are asking the Oregon Federal District Court to enjoin the agencies from suspending timber contracts during the government shutdown.

The American Forest Resource Council (AFRC), an industry trade association, joined an action brought by Murphy Company, High Cascade, Inc. and South Bay Timber, LLC.

“It makes zero sense for the cash strapped government to shut down operations that pay millions into the United States Treasury,” said Tom Partin, President of AFRC. “These companies employ loggers and truck drivers that need to be making money to feed their families. Getting logs out of the woods and into mill decks is especially important at this time of the year. Otherwise, these companies won’t be able to operate through the winter.”

Under contract law, the government cannot summarily stop timber operations. Contractors operate under harvest plans already approved by the agencies before ground work begins. As long as critical inspections are not needed, they can continue to work. Scheduled payments are made electronically, similar to those made by businesses making quarterly income tax payments.

“One of the purposes for these contracts is to improve forest health and reduce fuel for forest fires and protect federal and adjoining property. Issues of public safety in campgrounds and along roads are involved. Shutting down operations means these objectives won’t be met and things will get worse,” Partin said.

“A timber operation isn’t something you can turn on and off like a light switch. Once equipment has to be moved out, it can be months before it can be moved back in. For example, operators have waited through the fire season for helicopters to be available. If they can’t fly, they will start work on private contracts and it could be another year before they can come back. Meanwhile, downed timber rots on the ground,” Partin said.

“What is happening to our members is particularly frustrating when other businesses with contracts to operate on federal land, such as ski areas, are being allowed to continue working,” Partin said.

The National Forest System includes approximately 190 million acres of public land throughout the United States. The BLM administers approximately 264 million acres of public lands. A blanket, unwarranted suspension of revenue-generating timber operations on these vast acres will have a devastating effect on individuals dependent on the timber industry and will exacerbate the impact of the government shutdown on the nation’s economy.

Murphy Company employs over 500 people in its manufacturing facilities in Oregon and Washington. Timber from Forest Service and BLM contracts supplies over one-third of the raw material needs of its Oregon plants. High Cascade purchases timber from the Gifford Pinchot, Mt. Hood and Ochoco National Forests to supply mills in Carson, Washington and Hood River, Oregon. South Bay Timber currently has cutting rights under four stewardship contracts with the Forest Service and BLM on which it employs about 40 people.

AFRC is a regional trade association representing some 60 lumber, plywood and wood products manufacturers in California, Idaho, Montana, Oregon and Washington. Its members utilize public timber in their manufacturing operations. In many areas where its member mills are located, the national forests are a significant source of timber supply because there are few private lands.

Leave a comment

Filed under Forest, lumber

August 13 Timber & log prices drop

Timber & log prices drop

 

September 9, 2013

Timber Industry Report
By Rick Sohn PhD.
Umpqua Coquille LLC

Interest rates increased last month, but real estate sales rose, as if homebuyers wanted to catch the bottom. Log prices dropped a lot, and lumber only somewhat, helping the mills. Seven-year trend of lumber, logs, housing, and mortgage statistics are shown below.

chart-sohnsept2013

Interpretation
The price of lumber has decreased, but the price of logs has REALLY dropped. Net result? Logs are more affordable, mills are breathing a sigh of relief, and are making some money.

Fire danger has decreased in areas of the Pacific Northwest where it has been raining, This will ultimately help keep log prices down since logging operations can proceed and logs become more plentiful. Fire season still has life however, and things can change with a dry September.

According to Janet Johnson, Prudential Realty, The Roseburg Real Estate market has “exploded” with more offers being written and properties coming on the market, in the last few weeks. Judie Dunken, with the Dunken Group in Portland, is similarly positioned. RMLS reports that the Portland market has closed 10% more sales than last month, and that number for July is the best since 2005. The median home sales price in Portland is up to $280,000 and the average is $326,000. Rising interest rates, now 4.40%, have not hurt the summer home market, even though they are up over a full percentage point compared to the beginning of 2013. Many people are saying that buyers seem to be jumping in, before the interest rates rise even further.

The Portland unsold inventory remains below 3 months. The time on the market is 63 days, one month less time on the market than a year ago. Compare this to Roseburg, where there are 9.5 months of unsold inventory on the market, and an average market time of 190 days – also 30 days less time on the market than a year ago. While both markets are making significant improvements, its slower in a rural area like Roseburg than an urban area like Portland. This discrepancy leads to the following conclusions (with pockets of exceptions): there is an overall sellers market in Portland, but an overall buyer’s market in Roseburg and other rural towns.

This major difference in housing markets mirrors the economic recoveries that have occurred in rural and urban Oregon. If only rural Oregon could cut – or even salvage– more timber, rather than let it burn or get devoured by massive populations of bugs, the economies could improve.

Housing starts and building permits are showing some improvement this month, but are well short of the 1 million levels, reached in the Spring of 2013. Home prices continue to rise, albeit more slowly. According to Zillow, median home price rose the most in May, where it increased $1,300 over April, and has continued trending up with lower increases since then, as shown in the chart above.

It will be interesting to see if the gradual increases in home values and the rate of sales can continue, despite the rising interest rates. If so, there is hope that the housing starts and building permits will rise once again. This would really help the overall economy. We are still at typical deep recession levels of housing starts and building permits.

Data reports used with permission of:
1) Random Lengths. Through Sept. 2012, 2”x4”x8’ precision end trimmed hem-fir stud grade from Southern Oregon mills. Starting Oct. 2012, consolidated with Kiln Dried Studs, Coast Hem-Fir 2x4x8’ PET #2/#2&Btr. Price reported is Dollars per Thousand Board Feet, generally the third week of the month. One “board foot” of product measures 12 inches by 12 inches by one inch thick.
2) RISI, Log Lines. Douglas-fir #2 Sawmill Log, Average Region 3 Southern Oregon price, reported in Dollars per Thousand Board Feet of logs, Scribner Scale. The standardized Scribner Scale includes expected saw trim waste, so a log board foot is much more wood volume than a product board foot.
3) Dept. of Commerce, US Census Bureau. New Residential Housing Starts and New Residential Construction Permits, seasonally adjusted, annual rate. Recent reports are often revised in bold. Also, major revision made each May, reaching 2 1/2 yrs back.
4) Regional Multiple Listing Service RMLSTM data, courtesy of Janet Johnston, Prudential Real Estate Professionals Broker, Roseburg, OR. Inventory of Unsold Homes (Ratio of Active Listings to Closed Sales) in Portland, Oregon, for most recent month available.
5) Freddie Mac. Primary Mortgage Market Survey. 30-year Fixed Rate Mortgages Since 1971, national averages. Updated weekly, current report is for the prior full month.
6) Mortgage-X Most recent weekly rate of 30-year Fixed Rate Mortgages, national average.
7) Zillow.com Median value of homes sold in the United States during the month, weighted according to each area population. The Median removes the effect of outlier expensive homes, with equal numbers of homes above and below the median value each month. Revisions in bold
Issue #6-8. © Copyright Rick Sohn, Umpqua Coquille LLC.

Leave a comment

Filed under lumber

Timber tweak cures baseball bat breaks

Timber tweak cures baseball bat breaks

 

August 8, 2013

Rate of shattered baseball bats 50 percent less, thanks to Major League Baseball, Forest Service

 By USDA Forest Service

As the 2013 Major League Baseball (MLB) season slides into the All-Star break, U.S. Department of Agriculture Secretary Tom Vilsack announced the results of innovative research by the U.S. Forest Service, and funded by MLB, that will result in significantly fewer shattered baseball bats.

baseball bats. courtesy of TECO

Photo courtesy of TECO.

“This innovative research by the U.S. Forest Service will make baseball games safer for players and fans across the nation,” said Secretary Vilsack. “The U.S. Forest Products Laboratory has once again demonstrated that we can improve uses for wood products across our nation in practical ways – making advancements that can improve quality of life and grow our economy.”

Testing and analyzing thousands of shattered Major League bats, U.S. Forest Service researchers at theForest Products Laboratory (FPL) developed changes in manufacturing that decreased the rate of shattered maple bats by more than 50 percent since 2008. While the popularity of maple bats is greater today than ever before, the number of shattered bats continues to decline.

“Since 2008, the U.S. Forest Service has worked with Major League Baseball to help make America’s pastime safer,” said U.S. Forest Service Chief Tom Tidwell. “I’m proud that our collective ‘wood grain trust’ has made recommendations resulting in a significant drop in shattered bats, making the game safer for players as well as for fans.”

Outfielder Kensuke Tanaka’s bat cracks on impact with the ball during a San Francisco Giants game. The U.S. Forest Service has worked with Major League Baseball on bat design that greatly reduces the number of bats broken during a season. (Photo @2013 S.F. Giants)

Outfielder Kensuke Tanaka’s bat cracks on impact with the ball
during a San Francisco Giants game. The U.S. Forest Service has
worked with Major League Baseball on bat design that greatly
reduces the number of bats broken during a season.
@2013 S.F. Giants

“These results would not have been possible without the outstanding work of the Forest Products Laboratory and the tireless efforts of its project coordinator, David Kretschmann,” says Daniel Halem, MLB’s Senior Vice President of Labor Relations. “Major League Baseball greatly appreciates the invaluable contributions of the Forest Products Laboratory and Mr. Kretschmann on this important issue.”

The joint Safety and Health Advisory Committee of Major League Baseball and the Major League Baseball Players Association began working to address the frequency of bats breaking into multiple pieces five years ago. FPL wood experts looked at every broken Major League bat from July to September during the 2008 MLB season.

The research team found that inconsistency of wood quality, primarily the manufacturing detail “slope of grain,” for all species of wood used in Major League bat manufacture was the main cause of broken bats. Also, low-density maple bats were found to not only crack but shatter into multiple pieces more often than ash bats or higher-density maple bats. Called multiple-piece failure, shattered bats can pose a danger on the field and in the stands.

Courtesy Major League Baseball

Photo courtesy Major League Baseball.

Slope of grain refers to the straightness of the wood grain along the length of a bat. Straighter grain lengthwise means less likelihood for breakage.

With the help of TECO, a third-party wood inspection service, the FPL team established manufacturing changes that have proven remarkably successful over time. Limits to bat geometry dimensions, wood density restrictions, and wood drying recommendations have all contributed to the dramatic decrease in multiple-piece failures, even as maple’s popularity is on the upswing.

The Forest Service research team has been watching video and recording details of every bat breakage since 2009. The team will continue monitoring daily video and studying broken bats collected during two two-week periods of the 2013 season, working to further reduce the use of low-density maple bats and the overall number of multiple-piece failures.

The mission of the U.S. Forest Service is to sustain the health, diversity and productivity of the nation’s forests and grasslands to meet the needs of present and future generations. The agency manages 193 million acres of public land, provides assistance to state and private landowners, and maintains the largest forestry research organization in the world. Public lands the Forest Service manages contribute more than $13 billion to the economy each year through visitor spending alone. Those same lands provide 20 percent of the nation’s clean water supply, a value estimated at $7.2 billion per year. The agency has either a direct or indirect role in stewardship of about 80 percent of the 850 million forested acres within the U.S., of which 100 million acres are urban forests where most Americans live.

#

USDA is an equal opportunity provider and employer. To file a complaint of discrimination, write: USDA, Office of the Assistant Secretary for Civil Rights, Office of Adjudication, 1400 Independence Ave., SW, Washington, DC 20250-9410 or call (866) 632-9992 (Toll-free Customer Service), (800) 877-8339 (Local or Federal relay), (866) 377-8642 (Relay voice users).

Leave a comment

Filed under lumber

Wood products find floor

Wood products find floor

Timber Industry Report

By Rick Sohn, PhD
Coquille LLC

A correction in wood products seems to have found a floor, interest rates are trending down, and real estate activity continues at a healthy pace, despite slower starts. Seven-year trend of lumber, logs, housing, and mortgage statistics are shown below.

chart-sohn-aug13

Interpretation
Last month falling lumber and log prices, and rising mortgage interest rates were highlighted. This month, a negative trend in Housing Starts and Building Permits continues and we are now back down to later 2012 levels.

Monthly average mortgage interest rates are still headed up, and July will report 4.37% rate. The most recent week does show a dip to 4.31%.

Wood products prices seem to have found a floor. Not only studs, but according to Random Lengths, Oriented Strand Board prices fell 41% in the second quarter, before finding a floor. This is the sharpest single quarter decline for OSB in the last 17 years, since these records have been kept.

Log prices have not fallen as far, so there is more squeeze on the wood products producers.

This is a year of serious forest fires in the Southern Oregon area. 35,000 acres have burned in Douglas County as of this report. This represents a mix of private industrial timberland and Bureau of Land Management lands, perhaps 10-15,000 acres of private industrial land. A lot of the industrial land is covered with reproduction forests that are not merchantable. These stands will represent a total loss.

To the minor extent that there is merch timber, rapid salvage can be expected from private lands. There is not likely enough merch timber to affect log prices, as substitution from planned logging by industrial producers will occur. The BLM lands, in contrast, are likely dominated by a forest of merchantable timber. Barring the effects of a recent court case supporting logging on BLM O&C lands, salvage logging, is not likely, even though it would be desirable for forest recovery and the economy.

In the meantime, home sales do not seem to have slowed much, and real estate sales statistics remain positive and improving. Unsold inventory in Portland, while up slightly, is still below 3.0%. And, the median US home value continues to increase.

According to Roseburg Prudential Agent Janet Johnston, agents are busy with lots of activity, despite the uptick in interest rates, which are still excellent for most people but might affect the ability of a few buyers to purchase. Some buyers will have to lower their expectations of what they can qualify for. Most activity is still in the $250,000 and under range, although there are now some pending sales in the $600-$800,000 range. Carol Johnson, a G.Stiles Realty agent in Roseburg is also reporting an increase in showings in the above-$600,000 price.

Data reports used with permission of:
1-Random Lengths. Through Sept. 2012, 2”x4”x8’ precision end trimmed hem-fir stud grade from Southern Oregon mills. Starting Oct. 2012, consolidated with Kiln Dried Studs, Coast Hem-Fir 2x4x8’ PET #2/#2&Btr. Price reported is Dollars per Thousand Board Feet, generally the third week of the month. One “board foot” of product measures 12 inches by 12 inches by one inch thick.
2–RISI, Log Lines. Douglas-fir #2 Sawmill Log, Average Region 3 Southern Oregon price, reported in Dollars per Thousand Board Feet of logs, Scribner Scale. The standardized Scribner Scale includes expected saw trim waste, so a log board foot is much more wood volume than a product board foot.
3– Dept. of Commerce, US Census Bureau. New Residential Housing Starts and New Residential Construction Permits, seasonally adjusted, annual rate. Recent reports are often revised in bold. Also, major revision made each May, reaching 2 1/2 yrs back.
4–Regional Multiple Listing Service RMLSTM data, courtesy of Janet Johnston, Prudential Real Estate Professionals Broker, Roseburg, OR. Inventory of Unsold Homes (Ratio of Active Listings to Closed Sales) in Portland, Oregon, for most recent month available.
5–Freddie Mac. Primary Mortgage Market Survey. 30-year Fixed Rate Mortgages Since 1971, national averages. Updated weekly, current report is for the prior full month.
6–Mortgage-X Most recent weekly rate of 30-year Fixed Rate Mortgages, national average.
7–Zillow.com Median value of homes sold in the United States during the month, weighted according to each area population. The Median removes the effect of outlier expensive homes, with equal numbers of homes above and below the median value each month. Revisions in bold
Issue #6-7. © Copyright Rick Sohn, Umpqua Coquille LLC.

Leave a comment

Filed under lumber

PRAGCAP: Lumber Futures Could be Pointing to Improved Residential Construction

Lumber Futures Could be Pointing to Improved Residential Construction

By Walter Kurtz, Sober Look

Lumber futures turned out to be a good predictor of US housing starts. The large decline earlier this year (see post) translated into weaker than expected residential construction in June (see post). That means we should certainly pay close attention to lumber as a leading indicator. And July is showing a steady increase in prices, potentially pointing to improving demand (see figure 1).

After a disappointing result in June, is construction picking up this month ? Many economists think so. The key data that researchers point to is the Homebuilders’ survey, which is at the highest levels since 2006 (see figure 2).

The index had certainly diverged from housing starts in the past, but the combination of this survey and higher lumber prices may be pointing to an improvement in residential construction for July. The US economy could certainly use it.

Lumber futures

(Figure 1)

Homebuilder survey

(Figure 2 – Source: DB)

Leave a comment

Filed under lumber