Economic impact of plantation timber inputs on dimension lumber production a case study

The economic impact of using 35-year-old loblolly pine plantation timber for dimension lumber production is evaluated through a case study involving a chip-n-saw (CNS) operation in Alabama. Results of the study indicate that the inclusion of plantation timber in the CNS log input mix, which consisted mostly (about 80% based on volume) of tops of natural stand sawtimber at the time of the study, could have a positive impact on mill profitability. Expected economic benefits increase with the proportion of plantation timber in the log input mix, all other factors held the same. For the study mill, usage of a CNS log input mix that includes 20, 30, 40, 50, 60, 80, or 100 percent plantation timber would mean 21.4, 33.5, 43.7, 55.1, 67.6, 88.0, or 109.1 percent of additional gross sawmill profits, respectively. These in absolute terms would mean approximately $760, $1,188, $1,551, $1,956, $2,399, $3,133, or $3,869, respectively, of additional before-tax net profit per 8-hour operation under conditions existing at the time of the study.

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