Estimating log prices of Douglas-fir through an financial analysis of wood density on lumber recovery and pulp yield
Acuna, MA and Murphy, G, Estimating log prices of Douglas-fir through an financial analysis of wood density on lumber recovery and pulp yield, Forest Products Journal, 57, (3) pp. 60-65. ISSN 0015-7473 (2007) [Refereed Article]
Traditionally forest products markets have required logs with particular external properties such as diameter, length and knot size. However, markets are now beginning to include requirements for new internal properties, such as basic density and stiffness. Although markets have responded to these new requirements with prices that afford only limited incentive for producers to meet such demands, the new characteristics are valued by these markets and are considered key for competitive forest companies to stay in business. This paper presents a general methodology to estimate relative log prices of Douglas-fir when logs of different wood density classes are processed and converted into end products (lumber and pulp). Three log density classes were evaluated. For the lowest basic density class (300-399 kg/m3), net returns for pulp were about 28 percent lower than the middle class (400-499 kg/m3). The upper class (500-600 kg/m3) net return was 32 percent higher than the middle class. For conventional lumber log grades, the percentage differences between the middle density class and lower and upper classes were 9 and 4 percent, respectively. These results show that premium prices for logs can be established when internal properties, such as basic density, are specified.