Ways to harvest and sell your logs

Types of harvesting and log sales

There are 3 main ways of harvesting and selling logs:

• Managed sale – a harvest management company plans and coordinates the harvesting activities and selling of the logs. You have some influence and control in decision making.
• Sell the standing timber (stumpage sale) – you sell the standing timber for a lump sum or per tonne amount.
• Manage the harvest yourself – you organise all harvesting and selling activities.

What to be aware of when selling logs

There are some things you will need to factor in to your decision making process when selling.

Prices

Export logs are sold on a per Jas m3 basis. Domestic logs are sold on either a per tonne or per m3 basis.

Conversion factors apply when comparing log prices and these vary with tree age, size, season and across regions.

Compare returns at the forest gate (price less cartage) for different markets, for example:

• the export price is $150 per tonne at wharf with $60 cartage costs to wharf = $90 per tonne at forest gate
• the same domestic grade is $120 per tonne at mill with $10 cartage costs = $110 per tonne at forest gate.

Grades

Look at the overall prices instead of just focussing on the price for 1 or 2 grades. Your forest will yield different quantities of high, medium and low quality grades so the range of log prices across all grades is important.

Find out more about New Zealand log grades for radiata pine – MPI website

Managed sale contracts

Ask the harvest manager what markets they have access to and check any contracts they have in place. Do these give you the opportunity to get the best return on your logs?

Sell the standing timber contracts

Require the buyer to provide security over the logs and proceeds under the Personal Properties Securities Act. If payments are in instalments, then contractual terms need to provide you with protection. For example, in the event of non-payment or long payment delays, can you stop harvesting?

Market conditions

It is rare for every market condition to be in your favour, such as:

• access to the most favourable log markets
• high log prices across all grades
• foreign exchange rate
• shipping costs
• contractor availability for harvest, earthworks and cartage
• good weather conditions
• availability of suitable harvesting machines.

Be prepared for market fluctuations.

Speciality timbers

For more information on speciality timbers, such as eucalyptus, cypress and cedar, see Farm Forestry's speciality timbers pages.