Forest Income Opportunities - Department of Natural Resources

Forest Income Opportunities
Workshop
Cornell Cooperative Extension
B
Broome
andd Chenango
Ch
C
Counties
ti
Presented
P
t d by:
b
Laura Biasillo, Rebecca Hargrave, Kevin Mathers, and Rich Taber
Harvesting Trees for Timber
and Firewood
Univ. of MD
www.raggedviewfarm.com
Benefits of Sustainable Harvesting
ƒ enhances wildlife habitat diversity
ƒ improves road access and structures
ƒ offers recreational opportunities
ƒ benefits water quality resources
ƒ can offset home heating costs
Heacock
eacoc Lumber,
u be , Pa.
a.
ƒ offers a substantial and sustainable form of income
(more over the course of years if done correctly/sustainably)
How do we do all of this,
protect
t t the
th forest
f
t andd
make money?
Develop a Forest Stewardship Plan
Components of a good plan:
ƒ Landowner Goals and
objectives
ƒ Maps
ƒ Inventory Data
ƒ Stand Descriptions
ƒ Timetable for activities,
including timber
harvesting
A good point to remember~
remember
…landowners are often tempted to accept what
appears to be an attractive price right away for their
best trees without considering the impact a harvest
will have on the future value of the remaining trees.
(th “h
(the
“handshake
d h k arrangement”
t” tto h
harvesting,
ti
often
ft
without a contract)
…this
this can result in a “high-graded”
high graded forest,
forest where only
the best is taken and the poor trees are left
“High
High graded forests”
forests
Ralph Nyland
Nyland, SUNY
SUNY-ESF
ESF
Possible consequences to highgrading
and diameter limit cutting:
1 Price received for timber may be much less than if a
1.
forester had handled the sale, and put timber out to bid
2 Possibly more money up front but
2.
less in the long run
3. No written contract to hold logger responsible or
accountable
4. Forest structure, density, and regeneration may be set
b k for
back
f many years
5. Timber theft might occur
6 Oth
6.
Other woodland
dl d values
l
may be
b degraded
d
d d
(scenic, wildlife, soils, wetlands, streams)
A good timber/firewood sale
typically needs three key players:
„
A iinvolved
An
l d landowner
l d
„
A professional forester
„
A trained, reliable logging contractor
Ap
professional forester
Types of foresters:
1. State: i.e. DEC
2. Private Consulting
3. Industry
4. Extension/University
Consulting Forester with Landowner
A Consulting Forester serves as the landowner’s
representative throughout the conduct of a timber sale
sale,
much like an attorney representing his or her client
Typical steps to a
timber/firewood
/
harvest
1.
1
2.
3
3.
4.
Locate property boundaries
Inventory trees and identify/mark trees to be cut
Locate roads,
roads trails
trails, and log landings
Solicit bids to several logging contractors and select the
winning
g bid from a reputable
p
logger/firm
gg
5. Prepare timber sale contract; possibly have logger post
performance bond
6. Monitor the sale, ensure Forestry Best Management
Practices (BMP’s) are being followed
7 Complete
7.
C
l t post-harvest
th
t administration
d i i t ti and
d activities,
ti iti
return bond if terms of contract are satisfied
Sample Consulting Forester activities:
Arrange a contract
Inventory the forest
M i the
Monitor
h h
harvest
Select trees for harvesting
Road and skid trail layout
What if you want to do some
harvesting on your own?
own?
Ergonomic hand arch
D -it
DoDo
i -Yourself
itY
lf vs
vs.. Commercial
C
i l Harvests
H
Do-it-Yourself
Commercial
„
May be only option for low
value
l (“l
(“low grade”)
d ”) wood
d
„
Can be done with more care
and control
■ Sell “stumpage”
p g ((standing
g trees),
),
vs. logs or lumber for up-front
payment and capital gains
treatment of income
„
Greater tax liability (ordinary
vs. capital gains income)
■ Requires minimal effort on
owner’s part
„
Strenuous,, dangerous
g
work
(good “exercise”)
„
More marketing risk
„
Requires expensive
equipment
■ Less control and greater risk of
impact, so professional
assistance is recommended
■ M
May be
b the
h only
l option
i ffor steep
slopes
Examples of Small Scale
Harvesting Equipment
ATV Logging
gg g Arch
Selecting Tractors for Logging
Factors to consider:
■
■
■
■
■
■
■
■
■
Size, cost, and age off machine
S
Cab, roll bar and canopy, or open?
Other uses,
uses farming
farming, snow plowing
plowing, brush
hogging
Type of hitch, i.e. none, 2 pt., 3 pt.
Type of hydraulics and number of outlets
2 wheel or 4 wheel drive?
Safety equipment, i.e. roll bars, seat belts,
shields
Front end loader?
Gas or diesel?
Unsafe tractors for woods work!
Well equipped examples of tractors
One more alternative:
American Suffolk Punch Association
Small sawmills/firewood operations
Bandsaw, chainsaw, or circular?
Additional value added equipment
Post sharpener
Firewood processor
Wood chipper
Firewood bundler
Business Considerations:
Firewood & Portable Sawmill Operations
Skills Required
■
Good physical fitness
■
Excellent mechanical skills
■
People skills – enjoy meeting
meeting, negotiating
negotiating, and
working with new people
■
Marketing skills if you plan retail sales
■
Organizational skills (record keeping,
bookkeeping etc
bookkeeping,
etc.))
Financial Considerations
■
Profit expectations provided
■
by equipment manufacturers
are overly optimistic.
■
It can be risky to finance the purchase of
equipment and expect income to pay the loan.
■
There are fixed costs that need to be paid even if
you are not working.
ki
Equipment
q p
■
More expensive, more automated = higher
production rates. Can you justify it?
■
Maintenance expenses need to be factored in
(fuel, parts, ? mechanic fees, etc.)
■
Used equipment can be a
good option for mechanically
inclined people.
■
Rent a splitter for small-scale
wood sales?
Obtaining a Supply of Wood
■
Small scale operation – Sustainable production
from your woodlot
■
Purchase logs from landowners, loggers, tree
service companies.
■
For portable sawmills, have landowners provide
logs.
■
Will there be more competitionfor low-value
biomasswood in the future?
Know What Your Customer Wants
Firewood
Sawmills
ƒ Split
ƒ Type of wood
ƒ Seasoned
ƒ Length
ƒ Measurement unit
ƒ Delivered
ƒ Dimensions
ƒ Custom cutting
ƒ Delivery
ƒ Dried? Air or Kiln?
ƒ Off-site cutting
Legal Considerations to Sell Firewood
NYSS A
Ag and
d Markets
k
■
Hardwoods exclude: conifers,
f
aspen, basswood,
butternut, willow, gray and paper birch.
■
“Seasoned”
“S
d” wood
d mustt specify
if d
duration
ti off
seasoning
■
Advertising of wood requires three dimensions in
feet and inches: also “full cords” vs. “face cords”
■
Sales tax should be collected (?)
■
Revenue should be reported to IRS and NYS
■
50 mile radius limit for firewood (DEC)
Insurance
In addition to general liability insurance –
you may need:
ƒ E
Equipment
i
t “floater”
“fl t ” insurance
i
rider
id tto cover
damage when equipment is on the road or at
a job site
site.
ƒ If you have employees – workmen’s
compensation insurance.
insurance
Wood Biomass
New Developments
and
Income Opportunities
Where will Wood Biomass
Come From?
„
“Row Crop” trees: Willow or Aspen
„
T
Tree
clearing
l i operations
ti
„
Plantations
„
Waste wood products: construction waste,
pallets, etc.
„
Your Forest?
Wood Energy Production Methods
■
■
■
■
■
■
Thermal combustion
Combined heat & power
Electricity
Co-fired wood/coal
Cellulosic ethanol
Polygeneration
Cayuga Nature Center
Wood Chip Boiler
Wood Fuel Promotion Programs
„
One PA School saved
$80 per student per
year.
year
US Salt Facility
Watkins Glen
„
„
400 tons of
wood per day!
$25-35 per ton
Summerhill Biomass Systems
y
powdered
biomass combustion
Positive Impacts
„
„
„
„
„
„
Improved market for low value trees
Chance to improve forest health
Increase in local forest industry jobs
“Clean” energy
Increased energy security
Renewable energy resource
Negative Impacts
Removing too much standing or down wood
could:
„
„
„
„
Damage wildlife
D
ildlif h
habitat
bit t
Degrade soils (loss of nutrients, soil drying)
Increase erosion
Reduce water quality
Avoiding Negative Impacts
„
Consider ecological impacts
Learn from Europe
„
„
Austria: leader in wood energy
Goal of 35% biomass energy from all sources
R lit Check
Reality
Ch k
New York Energy Use
„ 4.3 quads/yr total energy consumed
„ 0.5 q
quads/yr
y residential heating
g
„ 0.2 quads/yr sustainable forest biomass
Thanks to
Tony Nekut
Master Forest Owner Volunteer
Tompkins County
Maple Syrup
ƒ It takes about 40 gallons of sap to make one gallon of
syrup.
ƒ A good tap will provide a quart of syrup a year.
ƒ Trees should not be
tapped until they reach
12 inches.
ƒ An additional tap can be
added every 6-7 inches
thereafter.
ƒ There is a huge market
potential for syrup in NYS.
ƒ Timing is everything.
M l N
Maple
Needs
d
„
„
„
„
Mature Sugar Maple Trees, or access to them
(leased)
Tapping Equipment
Boiling Equipment
Packaging
Sugar
g Maple
p Trees
ƒ Large, healthy trees, with good canopies.
ƒ Minimum
Mi i
12” (10”) DBH ffor 1 ttap
ƒ Could add a second
ttap att 18” if ttree
is vigorous
ƒ Spatially arranged
in proximity to
each other
ƒ Downhill
arrangement
g
Maple Syrup
Bucket hanging on Spile
Traditional Method
Maple Syrup
Plastic Tubing Used to Gather Sap
note down hill arrangement
Maple Syrup
Storage Tanks: Sap must be
collected and processed daily,
Maple Syrup
Sugar Shack
Maple Syrup
ƒ Evaporators $200 - $10,000
ƒ Small scale: campp stove/outdoor fire
and roaster pan
Time
Maple Syrup has two time relationships
Timing of Tapping
Freezing
F
i temperatures ffollowed
ll
db
by, warm
(above 40˚) temperatures.
„ Tap too soon,
soon holes start to dry up
„ Tap too late, miss some good runs?
„
Time it takes to Boil
„
Depends on pan, preheaters, filters, etc. and
amount of sap
Considerations
„
„
„
„
Lease Trees
Sell (or buy) Sap
Create Value-Added products
Agritourism
Opportunities