Last weekend we had the privilege of meeting with the
principals of about thirty timber harvesting firms from across America. The group was meeting in Washington, D.C., where
their association staff executive granted the Endowment the opportunity to
visit with them about the future of this critical link in the forestry sector
value chain.
Does Profitability Make a Difference?
In preparing for the meeting, we reviewed the results of a recent survey conducted by Timber Harvesting Magazine. The study looked at the profitability of timber harvesting businesses across the U.S. While the results might not pass academic muster for scientific purposes, the results were no less telling.
In preparing for the meeting, we reviewed the results of a recent survey conducted by Timber Harvesting Magazine. The study looked at the profitability of timber harvesting businesses across the U.S. While the results might not pass academic muster for scientific purposes, the results were no less telling.
For the calendar year 2010, on a “pre-tax” basis, more than
one-half of all firms reported either losing money or at best breaking even. When
those making less than a 10% return on their investment – something few would
consider a “get-rich-quick scheme” or much less enough to provide a healthy
financial foundation -- the number skyrocketed to fully 94% of all firms.
Lest you think this was a tiny sample, more than 800 firms
from 39 states responded to the survey.
Based on the best available information, that’s roughly 10% of the
entire sector. And, 2011 was likely even
more economically challenging!
Should You Care about the Plight of Loggers?
Why should we at the Endowment – and you, if you care about healthy forests – be concerned about timber harvesting businesses? The answer to that question has many parts. First, without a robust and financially-sound logging sector, how can one “manage” forests? Without harvesters how will America’s sawmills, pulp & paper mills, and growing number of wood-to-energy facilities, get wood from the forest to a conversion facility? When landowners need to thin a forest to ensure that it is more resilient, healthy, and resistant to insects, diseases, and wildlife, how is such to be achieved without a market for the wood and a means to harvest the desired material?
Why should we at the Endowment – and you, if you care about healthy forests – be concerned about timber harvesting businesses? The answer to that question has many parts. First, without a robust and financially-sound logging sector, how can one “manage” forests? Without harvesters how will America’s sawmills, pulp & paper mills, and growing number of wood-to-energy facilities, get wood from the forest to a conversion facility? When landowners need to thin a forest to ensure that it is more resilient, healthy, and resistant to insects, diseases, and wildlife, how is such to be achieved without a market for the wood and a means to harvest the desired material?
An often stated truth is that the lion’s share of American
forest landowners sadly don’t avail themselves of the service of a forester
when they decide to conduct a timber sale.
Yet, 10 of 10 landowners do call on a logger. That’s a powerful and critical connection
that offers tremendous value if society could better capture it.
Forest Management Requires an “Axe”
All-too-often we who are concerned about America’s forests have viewed loggers as there when they are needed. Something that can be “turned on” or “turned off” as needed. Even worse, many look at them as necessary evils. Such thinking has led to literally thousands of small businesses approaching the brink of economic disaster. Aldo Leopold, a forester called the “father of American wildlife management,” said the “axe” is necessary to manage forests. Few of us are trained or equipped to “deploy” that axe ourselves.
All-too-often we who are concerned about America’s forests have viewed loggers as there when they are needed. Something that can be “turned on” or “turned off” as needed. Even worse, many look at them as necessary evils. Such thinking has led to literally thousands of small businesses approaching the brink of economic disaster. Aldo Leopold, a forester called the “father of American wildlife management,” said the “axe” is necessary to manage forests. Few of us are trained or equipped to “deploy” that axe ourselves.
We may find, albeit too late, that without a professional,
well-trained, well-equipped, and financially-sound timber harvesting sector,
America’s forests and Americans who care about them are the ultimate losers.
More later on what we at the Endowment are doing to try and
create a brighter future.
1 comment:
Lovely post!
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