Commercial Timber Harvesting

The following information is taken from a publication issued by Washington State University Cooperative Extension and the U.S. Department of Agriculture, EB1818 "Managing Your Timber Sale", prepared by William E. Schlosser, Chief Forester, Russian Far East Environmental Policy and Technology Project, Khabarovsk, Russia; David M. Baumgartner, Ph.D., WSU Cooperative Extension Forester, WSU Pullman; Donald P. Hanley, Ph.D., WSU Cooperative Extension Forester, WSU Seattle; Steve D. Gibbs, Forest Stewardship Coordinator, DNR Olympia; and Vincent P. Corrao, President, Northwest Management, Inc., Moscow, ID.

Managing Your Timber Sale

A timber sale is one of the most complicated activities involved in the management of forest lands for the non-industrial private forest (NIPF) landowner. Many landowners don't spend enough time researching markets, interviewing logging operators, paying attention to forest practice laws and ensuring adequate attention to post-sale concerns. A timber sale should be more than the single event of harvesting trees; it involves the integration of landowner goals, silvicultural needs, specific site requirements, and the long-term productivity of the site.

Forest landowners need to carry out a sequential series of events to experience a successful timber sale. Forest landowners can complete these tasks individually or with the assistance of either an agency or consulting forester. Many forest landowners are not familiar with forest management concerns, insect and disease problems or the Washington State Forest Practices Act.

These forest landowners should consider contacting a professional forester for assistance during their timber sale. Other owners are more familiar with forest management concerns; however, they may still prefer to use a professional forester. A landowner can gain from their expert marketing experience when selling logs and their professional forestry advice in setting up the silvicultural prescriptions. Still, other forest landowners prefer to administer and set up their own timber sales. This information will be useful to individuals hiring a professional consultant or for administering their own timber sale.

The following 18 steps will assist the forest landowner in having a successful timber sale. However this information is not a substitute for the professional advice of an experienced forester. Click links below for more information:

1. Determine Management Objectives
2. Determine Silvicultural Prescriptions
3. Determine Property Boundaries and Timber Sale Boundaries
4. Contact Adjacent Landowners
5. Investigate Log Markets
6. Mark Timber To Be Removed During The Sale
7. Negotiate Log Purchase Agreements With Area Log Purchasers
8. Clearly Mark All Designated Skidding Trails And Log Landings
9. Develop A Timber Sale Contract
10. Advertise The Timber Sale To Identify Potential Logging Operators
11. Collect A List Of Interested Logging Operators
12. Schedule Tours Of The Property With Qualified Applicants
13. Award The Contract To The Successful Bidder
14. Landowner Presale Start-Up
15. Sale Start-Up And Administration
16. Sale Closeout
17. Post Sale Concerns
18. Recognize The Accomplishment And Congratulate Yourself
19. Final Comments
    

1. Determine Management Objectives
   The first step in any timber sale should be a formal evaluation of landowner goals and objectives. Goals are the driving force for activities on a forest. By ranking goals, the forest landowner can determine what is more important: long-term financial returns or aesthetics; wildlife or immediate dollar returns. Many times separate goals will complement each other or be mutually achievable. When goals conflict, the landowner must choose which is more important.
   
   After forest landowners evaluate their goals they can begin to define objectives.
   Objectives are the specific actions that lead to listed goals. Objectives without goals to drive them are not focused and will lead to "shotgun" management; sometimes hitting the mark, sometimes missing. The best method of formalizing goals and objectives is through a written forest management plan. A forest management plan considers the resources of the site including soil, water, trees, wildlife, access, and other characteristics, and then combines them with forest landowner goals to form specific management objectives.
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2. Determine Silvicultural Prescriptions
   The word silviculture means, literally, the culturing of trees. Just as horticulture focuses on growing shrubs, bushes, and flowers; silviculture focuses on growing trees. A silvicultural prescription is a set of activities designed to create or improve an environment for specific tree species for the habitat in which they exist. Silviculture prescriptions include pre-commercial thinning of overcrowded sapling trees, fertilizing forest trees, pruning limby trees, removing insect infected and diseased trees from an otherwise healthy forest, and employing many types of harvest techniques.
   
   Two primary types of harvest systems exist: Even-aged and uneven-aged. Even-aged harvesting removes all or most of the existing trees. Natural regeneration or, more commonly, planting of new seedlings follows. Uneven-aged harvesting results in forest stands of various tree sizes and age classes. The most appropriate harvest method depends on the species present, the condition, site characteristics, and the landowner's objectives.
   
   Be cautious regarding "selective harvesting." The removal of selected trees, such as occurs in a commercial thinning, can be a financially and environmentally beneficial practice in many cases. Unfortunately, the term "selective harvesting" sometimes is used as a euphemism for the detrimental practice of "high-grading." High-grading occurs when owners harvest the biggest and best trees, leaving behind the smallest and poorest.
   
   Forest landowners who are unfamiliar with silvicultural harvest techniques and the consequences that a misapplied harvest practice could have should consult a professional forester before making harvest plans. A professional forester can make silvicultural prescriptions that will improve the overall health,vigor, and growth of forests. Forest landowners should always use professional forestry assistance in deciding which harvest method or combination of harvest methods to use.
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3. Determine Property Boundaries and Timber Sale Boundaries
   Before any harvesting begins, determine property lines and ownership boundaries precisely. Clearly marked property line boundaries are critical to successful relations with adjoining landowners. One can avoid negligence charges by clearly marking the property lines for logging operators, road builders, and others who will be working on your property. If property lines have not been identified by a state licensed surveyor, hire one to identify your property boundaries.
   
   Timber sale boundaries are critical to timber sales. Using the forest management plan and forest activity plan, the owner can identify where to apply timber sale activities. In many cases, timber sale and property boundaries will be identical. In other cases, they may be totally separate. One of the most common methods of marking a timber sale boundary is by tying colored ribbon along tree branches and in bushes to indicate edges. Another method of marking a timber sale is to spray tree marking paint on the stems of trees along the border of the unit. However, tree paint will remain visible on leave trees for many years after the harvest is complete. If aesthetics are an important goal, removable ribbons may be preferred.
   
   In determining where to place timber sale boundaries, consider topography, insect and disease areas, special management areas, and the productivity of the sites to be harvested. Often it is possible to follow a contour line when placing the boundaries to imitate a clearing, thus minimizing the visual effect of the change. Many times it is necessary to prescribe a more radical harvest when insect and disease problems are present. Whatever the prescription, the forest management plan and the forest activity plan should outline the goals that drive the management objectives for the harvest, including the placement of timber sale boundaries.
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4. Contact Adjacent Landowners
   Although not absolutely necessary or required by a state statute, contacting adjacent landowners can avoid problems of confusion or misunderstanding. Even if adjacent landowners were contacted when property lines were being surveyed, this is a good time to walk adjoining property lines with neighbors.
   
   Where cutting boundaries fall next to property lines, obtain a formal agreement to the property lines in writing. This identifies the surveyed line or fence line and agrees that for the purpose of the timber sale it will serve as a cutting boundary.
   
   Discuss road building needs for the proposed timber sale. One road system built across multiple ownerships might better serve everyone. As forest parcels are divided into smaller and smaller units, road systems become more and more difficult to manage. By agreeing on a road system that crosses multiple ownerships, landowners can dedicate fewer total acres to roads at a lower cost to all parties involved.
   
   Advise adjacent landowners of the times that a timber harvest is going to take place. This practice avoids unnecessary concern and apprehension from others who might assume that timber theft is taking place.
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5. Investigate Log Markets
   At this stage of the timber sale, the landowner should collect information from area mills and log buyers on what species and sizes specific mills are accepting and the prices they are paying. This information determines what limitations will be levied on the harvest of trees during the sale. It also is very useful for the landowner to understand the economic trade-offs between harvesting and leaving certain trees during timber sale marking.
   
   Although timber prices and log size information are collected by the landowner at this time, no deals are solidified and no agreements are signed with the buyers. The economic data is very useful when deciding what species to harvest and where to sell the harvested timber. Write down each log buyer's quotations precisely, so you can make deals after determining the volume of timber to be harvested.
   
   Log mills and log brokers generally employ log purchasing agents to negotiate with private landowners. These individuals are responsible for log acquisitions from private lands. In many instances, the log purchasing agents will visit the site prior to making any offers. The site visits allow the agents to view the timber, its size, and quality so they can prepare an accurate bid. The landowner should verify how long the log purchasing agent's offer is valid.
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6. Mark Timber To Be Removed During The Sale
   The sixth step in the preparation of the timber sale is to mark the trees that will be removed during the timber sale. Decide which trees will be removed and which trees will stay after the harvest. Evaluate management objectives, determining silvicultural prescriptions, choosing a harvest system, and weighing the economic considerations of the sale.
   
   Give careful consideration and professional attention to the selection of trees to be removed during a timber harvest. Selecting leave trees that are inferior, disease susceptible, or poorly formed can severely reduce the potential of future timber crops from the site. A professional forester trained in leave tree selection is best suited to make these determinations prior to a timber sale.
   
   Marking the trees to be removed is accomplished in a combination of ways. Clear cuts generally are marked only around the boarders of the units, using either colored flagging or tree marking paint. Seed tree and shelter wood harvests generally involve painting the leave trees with tree marking paint. Commercial thinning allows the flexibility of painting either leave trees or reserve trees, whichever is the majority. Selective thinning and single tree selection harvests generally involve painting only the harvest trees.
   
   When painting trees, it is common practice by foresters to spray a horizontal band of paint the width of the tree bole at eye level on the uphill and downhill sides of the tree. Markers spray an additional spot of paint on the downhill side of the stem next to the ground. This butt spot of paint is left behind on the stump after a tree is harvested to inform the sale inspector whether that tree was initially marked for harvest or not.
   
   While marking the timber, foresters commonly run a tally of some percentage of the trees to be removed to determine the volume of the sale accurately. Normally, foresters record the diameter at breast height (DBH), the total height, species, percentage of defect in recorded trees, and occasionally other data. This information is used to estimate the total volume on the timber sale. That information is critical to marketing the timber from the sale to area log buyers.
   
   Tree marking could be one of the most important steps of a timber sale, but often is one of the most overlooked.
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7. Negotiate Log Purchase Agreements With Area Log Purchasers
   After the trees have been marked and the volume to be harvested determined, it is time to market the timber to local log buyers. Landowners can best market timber by providing the volume of each species being harvested as well as average tree diameter, height, and average defect to potential buyers. Log mills generally are tooled for certain log sizes and species to manufacture specific wood products. Therefore, different mills will pay different prices for logs based on species and size. Landowners generally can get higher prices from log buyers by providing the information listed above. The forester generally determines volume of the sale while marking the timber to be removed.
   
   When negotiating prices with a log buyer, the seller should request specific prices for each species being sold. In certain circumstances, the landowner should request multiple prices for certain species if a high degree of variation in sizes occurs within one species. For instance, if a portion of the Douglas Fir being sold has an average diameter of 12" DBH, and another has an average diameter of 48" DBH, the seller should request different prices based on these highly divergent size classes.
   
   When negotiating with log buyers for prices, the landowner should not offer to solidify a log purchase agreement until after all prices have been recorded from each potential buyer and the logging operator has been selected. First, consider many mills and log buyers by collecting prices from them all. Second, the choice of logging operator will greatly influence the delivery point, because each logging operator generally offers different prices to each delivery point. The distance and time of travel from the logging site to the log mill or buyer's location will influence the cost of transportation and the logging price.
   
   This process can be confusing. Because of this, many landowners retain professional foresters to help market the timber. A competitive bidding process will ensure that you are recovering the best price for your logs, especially when dealing with multiple log purchasers. A consulting forester can set up your sale on a competitive bid.
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8. Clearly Mark All Designated Skidding Trails And Log Landings
   Before presenting the timber sale to logging operators for bids, the landowner should have a realistic view of where the trees are going to be skidded and manufactured. Log manufacturing sites are called landings. Skid trails are used to drag trees from the site where they are grown to the landing. On many steep and rugged terrain sites the placement of skidding trails is difficult. Professional forestry assistance from foresters and the DNR can help determine skid trail locations that avoid fragile soils, riparian zones, and other special management areas. Logging operators also are valuable counsel since they regularly are involved in placing skidding trails and know the abilities of their machines and people.
   
   Beyond a log manufacturing location, the log landings are the site of log truck loading for transportation to the buyer. Usable roads must be built from existing roads to each log landing, adequate for loaded logging trucks to negotiate. Existing roads might not be suitable for log trucks to traverse, or might require additional improvements. Experienced logging operators generally know what is required to make roads suitable for trucking. The landowner should value these recommendations of the logging operators highly, but verify the recommendations with a forestry professional or the DNR prior to beginning improvements.
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9. Develop A Timber Sale Contract
   A landowner should consult appropriate advisors for legal advice prior to offering a contract to potential logging operators. A sample logging contract is available at the District office. If you want a copy of a logging contract please give Alan Hawson a call or send him an email.
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10. Advertise The Timber Sale To Identify Potential Logging Operators
    Advertise the timber sale through a logging bid prospectus. The prospectus generally is a one-page announcement of a request for logging bids, which includes the volume to be removed, the location, special considerations, a contact for further information, and a bid deadline. The prospectus also details the conditions that logging operators need to satisfy in order to qualify to bid on the logging job. You can mail this prospectus to potential bidders or hand it to operators who request it. Interested logging operators generally will request either permission to walk over the property or a guided tour of the site to discuss certain requirements of the timber sale.
    
    The landowner can use a variety of sources to reach potential logging operators, such as newspaper classifieds, direct mailings, logger lists from mills, word of mouth, and posted announcements. Give interested operators a copy of the prospectus and record their names and addresses.
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11. Collect A List Of Interested Logging Operators
    As logging operators contact the landowner and verify their interest in bidding on the timber sale, the landowner should request specific information from each operator. First, request a list of at least five past logging jobs completed by the potential bidder on non-industrial private forest lands. This information should include: does the logging operator have liability insurance and worker's compensation policy and adequate limits; the volume removed; the time spent on the sale; and the landowner's name and telephone number. Second, the potential bidder should provide at least three industry references. These can include logging mills, foresters and even other logging operators.
    
    Contact the references and verify the qualifications of the potential bidders. Develop a ranking system suited to specific objectives for the timber sale. This list will be necessary when scheduling tours of the property.
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12. Schedule Tours Of The Property With Qualified Applicants
    After excluding unqualified applicants from the list of potential bidders, the landowner should schedule tours of the property with qualified applicants. Schedule each qualified applicant tour for a separate time, as opposed to taking all of the operators in one tour. The list of qualified applicants should include at least three logging operators, but generally not more than eight. During the tour of the property, give the logging operators a copy of a sample contract, complete with all requirements of the sale, and potential delivery sites. The contract should include a date by which all bids will be collected, as well as a date by which the successful bidder will be selected and announced.
    
    During the tour, be careful to answer all operator questions uniformly so that each bidder is operating under the same set of informed assumptions. Finally, require each operator to submit a bid that includes delivery to each mill indicated in the sample logging contract. Delivery to each mill can be dissimilar because of travel time differences, mileage differences, and perceived differences in scaling practices among mills.
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13. Award The Contract To The Successful Bidder
    As soon as the deadline for accepting bids has passed, determine the successful bidder. Base this selection on price, the quality of work completed on the other sites, the strength of the references, and the comfort level with the bidder during the property tour and other interactions. While price might be the biggest criterion for many individuals, the comfort level with the operator can overturn a slight difference in financial returns.
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14. Landowner Presale Start-Up
    After you have selected and signed the successful bidder, complete a checklist of items to do with the logger before logging begins. Performance bond:
    
    As specified in the logging contract, the operator should make the performance bond payment in full to the landowner before any logging activities begin. Deposit this performance bond in a trust account immediately after receipt and hold until conditions of the contract merit release of all or a portion of it to the operator or the landowner as defined in the contract.
    
    Log purchase agreements signed: The landowner should have all log purchase agreements signed by the appropriate log buyers before beginning any logging activities. Provide the logging operator a written list of the delivery points and specifications for log manufacture, such as desired log lengths, minimum and maximum log lengths, minimum and maximum log diameters, and specifics.
    
    Log delivery sheet or load ticket books given to logging operator: The landowner should require that all log loads taken from the site be recorded through either a log delivery sheet or a load ticket book. These records require that each load be recorded for the date, time, truck driver name, and destination of every load taken from the site. This information is paramount for accurate load tracking and payment verification.
    
    Presale meeting with all of logging operator crew: While the logging operator is responsible for his or her employees, it is advantageous for the landowner to meet with the entire crew before logging operations begin to discuss any special contract requirements. These requirements might include special care given to wildlife management areas, highly erosive soil areas, or special reserve areas where access is restricted. This discussion also might include limiting or allowing access to the site after hours for hunting, fishing, or firewood gathering by the employees of the logging operator.
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15. Sale Start-Up And Administration
    The administration of the logging operation is critical to a successful timber sale. A good logging operator will strive to interpret the conditions and provisions of the timber sale contract to satisfy the intent, while making a profit for his or her business. However, many times the operator's interpretation of the contract might not be the same as the landowner's. It is useful to remain on the site the first couple of days of the logging operation to answer questions and to clarify the intent of the contract. The landowner should avoid directing or supervising any member of the logging crew, but instead deal directly with the logging contract representative. As the logging operation progresses, only visit the site periodically, avoiding continual "supervision" of the operation.
    
    When problems arise on the operation, talk directly with the logging operator representative. It is that person's duty to take corrective action with the crew member and guarantee corrective actions. However, it is to the landowner's benefit to minimize confrontational types of interactions with the representative. Many times what look like poor logging practices are truly efforts to minimize the damages to a site while removing the marked timber. The landowner often can approach the representative with a request to explain what happened and the reasons for the actions taken. The logging operator and the landowner should be partners in the operation, not adversaries.
    
    Keep an accurate record of each visit including what was discussed, discrepancies and corrective actions taken, and examples of where good work was completed. The record also should include observed loads hauled from the site during the visit, and an estimate of the volume in the log landing. This record is useful when discrepancies arise in the interpretation of the load ticket books or log load delivery sheet records.
    
    If necessary, you may request a site visit from the DNR forest practices forester to discuss the operation and to ensure compliance with the Washington Forest Practices Act. Record the official comments of the forest practices forester in your daily records. Take up any discrepancies noted by the advisor with the logging operator representative immediately and schedule corrective actions.
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16. Sale Closeout
    After all of the timber has been harvested and logs hauled and accounted for, the landowner is ready to begin timber sale closeout procedures. It is important to follow the provisions of the timber sale contract exactly with the logging operator.
    A sale closeout checklist is useful.
    
    All logging slash at landings is piled and ready for burning: The logging operator likely will move all equipment off the site as soon as contract requirements are completed. Therefore, all logging slash deposited at the log landings should be piled and made ready for burning before equipment leaves the site.
    
    All skidding trails should be cross-ditched for erosion control: Again, this is the best time to finish all work that requires equipment. While cross ditching can be done as the logging operation progresses, it should be completed as part of the timber sale closeout.
    
    Grass seeding completed or scheduled: Depending on the time of year, the operator should complete all grass seeding as required in the logging contract.
    All designated trees have been harvested: A complete tour of the harvested property should verify that all designated trees have been harvested and accounted for. In partial cuts where occasional designated trees have been substituted for leave trees, exceptions are generally made. However, areas that were missed during the logging operation should be discovered at this time to guarantee complete logging coverage.
    All logs hauled are accounted for: The logging operator should collect all load ticket books or log delivery sheets and verify that all loads recorded have been delivered and recorded by the appropriate log buyers. Bring a list of any outstanding loads to the attention of the logging operator immediately.
    
    Resolve forest practice compliance issues: If there are questions or concerns about compliance with Forest Practice Regulations, the landowner and operator may request a site visit from the DNR forest practices advisor.
    
    Final inspection with the logging operator: Schedule a final inspection of the property with the logging operator prior to moving equipment out to ensure that the requirements of the logging contract have been completed. Record and schedule any activities that need to be completed.
    
    Schedule release of all or a portion of the performance bond to the logging operator: After all contract requirements have been completed, except for slash burning, the landowner should schedule a release of all or a portion of the performance bond to the logging operator as specified in the contract.
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17. Post Sale Concerns
    Although the logging contract is completed at this time, with the possible exception of slash burning, the landowner still has additional concerns for the harvested timberlands. Watch skidding trails and roads for washing, sedimentation, erosion, and complete failure. Clean culverts out periodically, especially during and after the first few rains that will wash the majority of branches and loose wood into the stream channels. At this time, areas that may require some additional stocking can be evaluated for planting or scheduled for natural regeneration with a follow-up inspection in 3 to 5 years.
    
    As required in the logging contract, the logging operator should dispose of piled slash at the earliest opportunity. This disposal will reduce the fire hazard, increase aesthetics, and mitigate insect and disease potential on the forest. The DNR fire warden for the area will only allow pile burning during certain conditions and at designated times of the year. The landowner should check with the local DNR office to verify these times and to obtain necessary permits.
    
    Watch the number of windblown and damaged trees closely through the first winter and spring. In some cases, the number of damaged trees will constitute a logging re-entry to remove them after the harvest.
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18. Recognize The Accomplishment And Congratulate Yourself
    A useful purpose of the forest management plan is follow-up regarding reforestation, brush control, and other activities that may need attention. In most instances, the total outcome of a timber sale will not be fully recognized until after the harvest is complete.
    
    Wildlife use in certain areas might increase after the timber harvest. Stream flows might improve due to increased precipitation reaching the forest floor. Forage production could increase to the point that livestock production might be a management option.
    
    The astute landowner will recognize these added benefits to the forest and take advantage of the opportunities.
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Final Comments
The activities involved with selling timber are very complicated and require not only a great deal of time, but also a high degree of understanding of the industry. Many forest landowners not only lack the time needed to manage their timber sale, but also lack the professional forestry expertise to prescribe silvicultural prescriptions, market their timber, and hire logging operators.

If you hire a consultant, use these steps as a reference to understand what the consultant is proposing and why. If you wish to manage your own timer sale, then use this information as a reference for actions to take during the sale. Either way, you should feel comfortable asking questions and dealing with the professionals you will come in contact with during your timber sale operation.
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