Sunday morning Ramblings
Wasn’t yesterday an incredible day? I wish we could have some more warm sunny days like that one. I bet 99% of Mainers were outside especially given we are supposed to get snow tonight. Apparently Mother Nature did not get the memo that we don’t have the patience or humor for snow anymore this year. Our psyche needs sunshine.
We spent this past week doing some mulching up at Poland Spring Inn. It took us a little bit longer than expected to get it going because I had a mishap in the garage with the excavator. I took something apart that I shouldn’t have, just like a kid. That was a costly lesson. Nevertheless, we are up and running and it is working wonderfully. Last winter we cleared about 4 acres up there for more parking and to open up some sunlight near their pool. We are now grinding up a snarly bamboo mess in the area and it is looking great. We are really excited about this service we can now offer. I think landowners in our area will have a lot of interest in it because a lot of the woodlots we selectively harvest are people’s recreation land where they take daily walks and ride atvs. It is great for clearing land, over grown fields, and cleaning up landings & skid roads.
I would like to clarify something upfront for our landowners about how the Jay mill explosion will impact their harvest. The financial implications for landowners will not be very significant due to the fact that softwood pulp is low value product, similar to biomass. As an example : Say we estimate stumpage as $20-25,000 to the owner of a 40 acre parcel. The woodlot has say 500 ton of softwood pulp and for sake of ease, let’s say at $3 a ton that would net the landowner $1,500 if the Jay mill was running. Because it will have to be chipped instead, the price could drop to $1 a ton but because it doesn't get delimbed, every ounce of that tree gets delivered to the mill. This would result in approximately a $1,000 reduction in profit to the landowner, however due to the lack of the limbs left behind, it will result in a much cleaner job. The bulk of a landowners profit comes from higher grade products and we currently still have many viable markets for those products. The consequences of the Jay mill explosion will impact other stake holders in the forest products chain more so due to production volumes. Because of the ripple effect amongst other wood markets including biomass, we will spend more time waiting, we will likely have quotas, and everything will go much slower. A job that may have taken us 4 weeks in a normal market might take us 6 weeks.
I wanted to take a minute to talk a little about biomass as well. There has been a strong push in the forestry world to transition our process from a whole tree, chipping operation to a cut to length system. There are numerous pros and cons to both systems. I have teetered on the decision to add a cut to length system for quite some time now, but due to the sheer cost of the equipment I have continued to work with my whole tree system. The biomass markets have been volatile over the years. In my opinion, they don’t get the credit they deserve in the forest product chain. If the whole tree is going to be harvested, it makes sense to utilize the whole tree. I know energy markets are very complex, but we literally have renewable fuel growing in our trees and I would love to see it get the recognition it deserves. Right now, I think most of us would agree that having diverse low grade markets is extremely important to all of those in the forest product industry. As much as this mill shut down will impact the industry, we have to remain optimistic and move forward one day at a time.
On another note…. Life is interesting. Just before this major pandemic/economic crash/mill explosion catastrophe Chrissy and I decided to invest in a small building on the main rd in our town to house an office for both Kimball & Sons Logging and her work as a real estate agent for U&R Real Estate. The decision was made so that we can increase our visibility and also offer a place to meet clients outside of our home. About 2 days after we got under contract, the world started falling apart. We could have and probably should have backed out, but because we are glass half full kind of people we kept on. We closed on that property on Friday and we are looking forward to making it our own space! We will keep you posted on our progress. In the mean time go get a frozen custard at Ruby Rose, we will be in the same building. That ought to be great for the waistline. If you’re traveling on Route 26 in Poland, keep your eye out for our signs coming soon.
Have a great Sunday.