What Affects the Value of My Timber? Six Things That Decide the Check

Two tracts of timber with the same acreage can be worth very different money. Not a little different. A lot different. People are often surprised by that, and it is usually the first thing worth explaining to somebody who has just found out they own trees somebody wants to buy.

Before any of this: nothing you read here will tell you what your timber is worth. The only way anybody gets an accurate number is a timber cruise, where a consulting forester or a buyer walks the tract and measures what is standing on it. That is the only time a real number exists.

What this page is for is different, and it is worth having. If you know what drives the value, you know roughly where you stand before anyone makes you an offer. If you have a lot of big trees, you can expect more money. If you have a young stand of small pine, you should not be surprised when the number comes back modest. Knowing which situation you are in is most of what a landowner needs to avoid being taken.

Here are the six things that decide it.

1. What kind of trees you have

Different species bring different prices. Pine does not sell for the same money as oak. That is not a rule about which is better, it is just two different markets buying two different products. A tract of mixed hardwoods and a tract of planted pine of the same size will bring different numbers, and either one can be the higher of the two depending on what is standing there and what the mills are paying that month.

There are a great many species growing in North Carolina and they all have their own price structure. This is the first reason two equal tracts are not equal.

2. How big the trees are

Size is the one most people can see for themselves, and it matters more than almost anything else.

The dividing line in the woods is whether a tree will make a sawlog. Generally a sawlog needs to measure about ten inches across at the small end of the log, measured inside the bark. A log that makes that goes to a sawmill and gets cut into lumber, and lumber is where the money is. Sawlogs are the most valuable trees you own.

Trees that will not produce a ten inch log at the small end still have value. They are just worth less. The smaller material goes to pulp mills to be made into paper and board, and pulpwood is the least valuable thing that leaves your property, measured in dollars.

So when you stand and look at your woods, the rough question is: are these big trees or small trees? A stand full of trees that will make sawlogs is a different proposition from a stand of young growth, and you do not need any training to tell the difference.

3. The grade of the trees

This is the one nobody outside the business has heard of, and it has a large effect on your check.

Grade is a measure of quality. A big tree with no visible defects is a high grade tree. What we call a clear high grade log is one that is straight, with no visible knots and no visible damage. That log will bring considerably more money than a log the same size with overgrown knots in it, because the mill can cut clean, wide boards out of it.

The grades run prime, number one, number two, number three. The higher the grade of your trees, the higher the dollar amount you will receive.

Two tracts can have the same species, the same size trees and the same number of them, and still be worth different money because one of them grew straight and clean and the other did not. Grade is a real part of the value and it is invisible to almost every landowner looking at their own woods.

4. The ground the trees are standing on

Value is not only about the trees. It is also about what it costs to get them out.

Timber standing on hard flat land that can be worked twelve months out of the year will generally bring more money than the same timber on a steep slope or down in a swamp. It costs more to harvest under those conditions. Wet ground means waiting for it to dry, or not going at all. Steep ground means slower work and more risk. Every bit of that comes out of what a buyer can pay you and still make the job work.

This is not a buyer being difficult with you. It is arithmetic, and it is the same arithmetic for everyone bidding.

5. How easy it is to get to

Access is its own factor and it can move the number quite a bit.

If your timber has road frontage and a logger can get equipment in and trucks out without any trouble, that shows up in the price in your favour. If your tract sits two miles off the road and somebody has to build a road to reach it, that also shows up in the price, and not in your favour. Somebody is paying for that road, and it is coming out of the timber.

Worth knowing before you are surprised by it: a neighbour's permission, an easement, or a bridge over a creek can all change what your timber is worth without a single tree being different.

6. Volume, which is really about how thick they stand

The last one is volume, and volume is mostly about density. How thickly do the trees stand on your tract?

Are they ten feet apart or forty feet apart? The thicker they are, the more volume you have on the same acreage. And if they are both thick and large, you have a genuinely high volume on that ground.

Volume is what turns everything above into a number. Good species, good size, good grade, easy ground and easy access are all worth more when there is more of it. It is also why acreage on its own tells you very little. Twenty acres standing thick with big timber can be worth more than sixty acres of scattered small stuff.

Putting it together

None of these six work alone. A tract of high grade hardwood sawlogs standing thick on flat ground with road frontage is the best case anybody gets. A thin stand of small pine on a wet slope two miles off the road is the other end of it. Most tracts sit somewhere in between, and the six factors above are what a buyer is running through in their head while they walk it.

That is the useful thing to take away. When somebody makes you an offer, they have already priced all six. You will be in a much better position if you have thought about them too.

What to do with this

Do not try to price your own timber from this page. You cannot, and neither can anybody else without walking it. What you can do is form a rough expectation, and then go get a real number from somebody who measures it.

Two things worth doing before you sign anything:

• Find out what you have before you find out what somebody will pay for it. Those are two different questions and most people only ever ask the second one.
• Get more than one number. That single piece of advice is worth more than everything else written here.

North Carolina State Extension publishes average timber prices by region every quarter. That tells you what the market is doing. It does not tell you what your tract holds, and anybody who quotes you a figure without seeing the land is guessing.