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November 1, 2002

Purdue report contains good news for timber owners

WEST LAFAYETTE, Ind. – Indiana forest owners received some good news from the 2002 Timber Products Price Report and Analysis.

Despite a slow economy most timber prices are up substantially over last year, said William Hoover, the report's author and an Extension specialist in the Department of Forestry and Natural Resources at Purdue University.

Hoover credits strong new housing sales and consumer spending on furniture for the increase. He said consumers are asking for hardwood floors in new houses and that sales in the home refurbishing market also are strong. The railroad tie market and the declining dollar also helped boost the price.

Hoover said that perhaps the best news in the report is a renewed demand for black walnut timber.

"After almost 10 years of weak demand, prices paid for black walnut saw logs increased about 4 percent overall," he said.

That translates to an average price of $1 per board foot for the best grade of logs. Hoover said that the prices surveyed don't include the cost of harvesting or shipping.

"Black walnut's crown is back on, but black cherry remains king," Hoover said.

Cherry continues to be the most valuable type of timber, with log prices of $1.20 per board foot headed into the mill. Hard maple prices averaged a 10 percent increase over last year.

The largest saw log increases, in percentage terms, were for species such as basswood, cottonwood, elm, poplar and gum. The only species for which log prices didn't increase were ash, white oak and softwoods.

Hoover said a disease called ash decline is infecting ash trees and forcing many timber owners to cut their trees and send them to market. Trees that have ash decline die slowly over three or four years, giving timber owners a chance to harvest and send them to market.

The disease, and subsequent market flooding, prompted ash prices to decrease, while white oak prices are down because of lower demand.

Retail hardwood lumber prices are mixed, but there are many bright spots, Hoover said.

The report shows the top grade of black cherry at $2.50 per board foot, while walnut is more than $1.70.

In the veneer log industry, prices for larger logs of walnut, white oak and maple increased more than their smaller counterparts. This is a reversal of a decade-old trend, Hoover said, since smaller logs usually increase more in percentage terms.

He attributes the change to increased availability of large logs to send to the veneer industry.

"Over the last decade higher prices didn't bring forth a higher volume of larger logs because they simply didn't exist in the timber inventory," Hoover said.

The highest prices in the veneer industry were for larger black walnut and hard maple logs. White oak logs and smaller logs of all species were down in price, according to the report.

Both lumber and veneer industry buyers are extremely active right now, Hoover said. That means it's a good time for timber owners to contact their foresters and discuss harvesting options.

Individuals who don't have a forester can find one at the Woodland Steward Web site. A link to the organization can be found at the Purdue forestry Extension site.

The Indiana Agricultural Statistics Service and the Indiana Department of Natural Resources Division of Forestry conducted surveys for the report.

State statistician Ralph Gann said 87 mills reported usable data. The total production for these mills was 204 million board feet. The smallest mill reported production of 2 million board feet and the largest produced 18 million board feet in 2001.

Hoover said this year there was an increase in the number of veneer mills reporting prices, increasing his confidence in the survey results for the veneer industry.

The entire report and trend analysis can be downloaded from the Web.

Writer: Kay Hostetler, (765) 494-6682, kjh@purdue.edu

Sources: William Hoover, (765) 494-3580, billh@fnr.purdue.edu

Ralph Gann, (765) 494-8371, cn5@purdue.edu

Ag Communications: (765) 494-2722; Beth Forbes, bforbes@aes.purdue.edu; http://www.agriculture.purdue.edu/AgComm/public/agnews/

Purdue News Service: (765) 494-2096; purduenews@purdue.edu


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