Quote:
Originally Posted by 4RE KLR
Scott,
Has the mills slowed down on orders from you? Or are they still buying in the same volume?
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The local mills are slow, but weird things happen in a bad market.
If the mills are slow there is a shortage of sawdust and waste chips so the pulp markets start to rise and the demand for our lowest grade of trees climbs to a point where they become as valuable as any other log. Those paper mills can be awfuly hungry, a big mill with all machines going will use 400 truckloads a week.
There is starting to be a market for wood chips in the new co-generation plants. The Federal government made big promises of a supply of low end trees from thinning contracts all over the west. As investors started building the new wood fired generators the environmentalists filled suits to stop the thinning of the Federal Forests now those trees are free to burn where they stand instead of fueling the plants. It has been up to the State and private forests to help fill the need.
The poor dollar has made log exports start to pickup and the far east is beginning to look at logs that we would usually keep in the domestic markets. As the exports eat into our production the local mills start to see their own supplies dwindle and are willing to pay a bit more.
Another overlooked market is power poles. The fires in the last few years in southern CA along with wind and snow damage across the country has created a huge under supply of line poles. As of now there is a great demand for those products also.
I am as busy as ever, we hired 3 new guys last month and as of now I am considering another machine or two and several more crew members.
But then again I could be out of work tomorrow, who knows?
Scott S