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The Elkhorn Ranch Timber Sale… Did We Get A Fair Price?

By Roy Keene

Forest conservationists contesting public timber sales will reach a larger, more sympathetic public if they begin to expose or at least comment on the bogus economics. It’s more about the economy these days, less about endangered species.

For starts, public timber shouldn’t be for sale in this low market, period. Especially not when industry is sitting on over 2 billion board feet of public timber already under contract.

A major weakness with State Forest timber sales is that they are routinely purchased by the same large corporations. Comparatively low award prices reflect a lack of competition which fosters collusion and price fixing. Scott Timber (Roseburg Forest Products) and Swanson, two of the largest public timber sale purchasers, were the only “qualified bidders” listed for Elkhorn. Scott bought the sale for $273.52 per MBF for the Doug-fir, the bid species, and Swanson was second at $272.88. How conveniently close! I’m aware of nowhere in open timber markets where a concentrated stand of high quality, mature DF timber could be purchased for less than $425 as “stumpage”. This lack of real competition and price fixing also devalues future state forest sales which are appraised, in part, based on previous sales.

Of course raw logs from these state timber sales can’t be exported, but marginally processed logs (cants, squares, slabs, etc) can be and are routinely exported, especially when processed from 130 year old timber. Pseudo processing also provides profitable over runs on Scribner Scale, where a 1000 bd.ft. of scaled logs can typically produce 1500+ board feet of sawed wood.

Viewing air photos and applying simple empirical growth tables to the high growing site and average age class of Elkhorn’s timber suggests per acre volumes closer to 100MBF. This is nearly twice the implied sale volume at about 55MBF per acre. The basal area (stand density) calls in the Pre-operations Report are unusually low. Was basal area physically measured or is this seemingly low stand density a refection of a computer evaluated (SLIP) stand inventory?

Since this sale is being sold based on MBF aboard truck prices, the total sale timber volume was probably not cruised. The point is that there could be a lot more volume coming off Elkhorn than the reported 5,189 MBF. Since I haven’t physically viewed this sale, I won’t try to pin this overrun, but it could be significant.

Did we get a fair price for the 130 year old, low defect, high quality Doug-fir? Of course not. After purchaser credits and biased logging costs and scaling are considered, we’ll receive about half of what we should of. Especially had an experienced forester managed the loggers, conducted the sale, and prudently marketed the logs in our behalf… like it’s done in the private sector. If we could manage our own logging and export our logs the way industry exports theirs, we’d get nearly three times as much.

This implies that schools could receive the same funding from selling half or even a third of the current State Forest timber sale volume at fair value. It’s about the school kids, right? And, if the industry had to pay fair market value for our timber, they wouldn’t press so hard to purchase it.

Roy Keene is a forest consultant and private timber broker in Eugene

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Avatar of Guest Contributor Posted by on August 3, 2011. Filed under Coos County,Environment,Local Opinions,Oregon. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

12 Responses to The Elkhorn Ranch Timber Sale… Did We Get A Fair Price?

  1. stonehouse Reply

    March 29, 2012 at 10:00 am

    we amaricans should be ashamed of ourselfs for selling ourseves so cheap.surtain plases andcertain things are priceless.

  2. Avatar of magix

    magix Reply

    August 6, 2011 at 5:10 pm

    It is unfortunate that those who come here to disagree never backup their statements with hard facts or clear and concise examples. Instead they just call people names or uneducated because they don’t happen to share the same opinion.

  3. themguys Reply

    August 6, 2011 at 1:58 pm

    One more thing Sweetie, better be careful what you accuse people of doing, could get ya in trouble, or so I’m told.

  4. themguys Reply

    August 6, 2011 at 1:56 pm

    Well it’s nice to meet you too Jeanne, sweet thing, welcome.

    Are you guys working off a punch list now?

  5. Avatar of aghast!

    aghast! Reply

    August 6, 2011 at 1:45 pm

    Gee, Jeanne, it is great to scolded by someone about twisting numbers who doesn’t make the effort to analyze the numbers.

    I don’t know about Jeanne, but I do know that Gene, Roy Keene and magix, Richard, Jason and myself are all educated and all work for a living

  6. Gene Jennings Reply

    August 6, 2011 at 1:36 pm

    Wow, that was great Jeanne. Tell us more about nothing. If things are running so smooth as you suggest they are, then why are so many people upset about these issues . It appears that you’re just pissed that other people are pissed, and you don’t want to hear it, or know why.

  7. Jeanne Reply

    August 6, 2011 at 1:17 pm

    Wow, you people are really a bunch of uneducated fruit cakes.

    You can twist numbers however you like to fit your mindset; it obviously doesn’t matter if the state is making money for the school fund or not, you will find a reason to protest whatever the government and working people do that you don’t agree with.

    Please stop smoking pot and get a real job and try contributing to society in a meaningful fashion. Honestly, some people’s kids these days.

  8. Avatar of magix

    magix Reply

    August 6, 2011 at 11:00 am

    Yes, Gene, and Jim Young from ODF says “”We have a constitutional mandate to maximize revenue to the Common School Fund.” Clearly, they violated this mandate

  9. Gene Jennings Reply

    August 6, 2011 at 10:38 am

    The more than 86,000 acres of forest has a single purpose: Raise timber revenues to fund Oregon’s schools.

    That’s what we’re being told. We were also told that voters allowing a state lottery, and casinos, would fund our schools.
    with the logging and gambling revenues our schools are supposed to get, they should not be having to shorten their school days. Where’s the money really going? Whose pockets are fat ?

  10. Avatar of magix

    magix Reply

    August 3, 2011 at 3:41 pm

    Agreed, Jason, you are not asking for very much but media rarely presents the whole side of the story. The Elkhorn Ranch Sale is being sold as a benefit to the common schools fund to gain sympathy for allowing the public to be deprived of these forests and these types of facts help chip away at that thin veneer.

  11. Jason Reply

    August 3, 2011 at 1:25 pm

    I appreciate what Roy is saying here, and know how much numbers like this matter to a lot of folks, and should matter to a lot of politicians. Numbers like thisare a valuable tool in helping us to stop some of the devestating practices going on in The Elliott State forest. However, I also disagree strongly with what I see as an implication that there is some price or market level where it makes sense to destroy one of the few remaining stands of native coastal rainforest. I dont want to see Elkhorn Ranch, or any of the Millicoma Sales clearcut under any market conditions. Cascadia Forest Defenders main long term goal is to achieve permanent protections for remaining native forest, defined as forests that have never been logged. When we are talking about %3-4 of remaining standing forests, it sure doesnt seem like we are asking for much.

  12. Richard Chasm Reply

    August 3, 2011 at 12:55 pm

    Roy Keene knows what he is talking about. This is why the entire state forestry system needs to be overhauled. They are at best, incompetent and at worst cheating the public for the benifit of a few giant timber companies who have already took way more than their fair share. RFP through it union’s donations to the Oregon Labor Council in Portland has completely subverted the Democratic Party south of Lane County.

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