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Logging and Sawmilling Journal November 2014

february 2015

On the Cover:
Thanks to a low Canadian dollar, and a modest rebound in U.S. housing starts, Canadian lumber prices are at reasonably healthy levels, resulting in sawmills keeping busy. The Council of Forest Industries (COFI) will be looking at how to keep those mills busy at its upcoming convention in Prince George, B.C. in April. See the special pre-convention coverage beginning on page 44 of this issue of Logging and Sawmilling Journal (Photo of the new Lakeland sawmill in Prince George by Doug Hlina of Mill Tech Industries)

Renewable fuel oil can help fuel a sawmill’s bottom line
Ontario “liquid wood” producer Ensyn Corp. is ramping up production of its renewable fuel oil and has put the welcome mat out to the forest industry, noting that its biofuel facilities—when attached to an existing sawmill—can help to improve the economics of a mill.

High yield mill investment
A $30 million rebuild at EACOM’s sawmill in Timmins, Ontario, was a major undertaking for the company, but it’s expected to yield a production increase of as much as 20 per cent.

Have wood—will move it
Logging contractor Hec Clouthier & Sons harvests a wide assortment of logs in the areas they work in, in eastern Ontario. Typically they sell wood to 13 mills—but after a significant blowdown, they were able to sell wood into a staggering total of 38 mills.

Early woodlands adapters
Both Quebec logging contractor Mario Gauthier and forestry co-op Forestra have adapted well to new regulations that amended the fibre allocation system in the province, thanks to Gauthier’s solid equipment and Forestra’s focus on developing fibre markets.

Timber/beam specialists
B.C.’s Hyde Sawmill has found a successful market niche producing high quality timber and beam products using three Wood-Mizer band saws, and a Mahoe circular saw from New Zealand.

Timber price tracking
B.C. company WoodX offers a market intelligence data service to prospective timber buyers to help them make prudent and competitive bids in the BC Timber Sale program.

High performing mill iron
Every efficient sawmill needs a fleet of high performing millyard wheel loaders and the Fornebu Lumber operation in New Brunswick is finding its Hyundai equipment —which includes the big daddy of the fleet, a Hyundai 770 with 300 horsepower—fits the bill very nicely.

The Edge
Included in The Edge, Canada’s leading publication on research in the forest industry, are stories from the Canadian Wood Fibre Centre and Alberta Innovates - Bio Solutions.

Plenty of issues front and centre at COFI convention in April
Our special pre-convention coverage

The Last Word
The outlook for Canadian lumber producers over the next several years is positive—meanwhile, the outlook for Canadian pellet producers is positively rosy, says Jim Stirling.

DEPARTMENTS

Tech Update: Log, Lumber, and Grade Optimization Systems

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B.C. company WoodXTimber price tracking

B.C. company WoodX offers a market intelligence data service to prospective timber buyers to help them make prudent and competitive bids in the BC Timber Sale program, which provides a good barometer
for trends within the provincial forest industry as a whole.

By Jim Stirling

About 20 per cent of British Columbia’s allowable annual cut is dispersed under the provincially operated BC Timber Sale program.

Consequently, tracking what’s happening and where with those sales provides a good barometer for trends within the provincial forest industry as a whole.

After about three years of generally lateral movement, bids for timber under the program are now on a steady climb, reports Dean de La Mothe, the creator of WoodX, a widely read BC Timber Sale tracking system. “We’re on a general up slope,” he says.

That means bidders are becoming hungrier more consistently for wood fibre. But that said, there are blips along the way. For example, the bid prices for cedar were crazy, while those for cypress were flat at the time de La Mothe spoke with the Logging & Sawmilling Journal.

B.C. company WoodXThe bidders trend in the B.C. Interior is toward sales of homogenous stands of small pine. If the stand has a spruce mix, so much the better. “Bidders have gone to a smaller sawlog—about .3 cubic metres a stem—because it’s easier to mill. It represents the sweet spot of the lumber recovery factor as opposed to the larger piece sizes which are more inconsistent,” explained de La Mothe. “So we see quite a lot of strength there.”

BC Timber Sale strives to create a transparent and fair open market system for standing timber. WoodX offers a market intelligence data service to prospective timber buyers to help them make prudent and competitive bids. de La Mothe expanded on the BC Timber Sale role with a supermarket analogy: the prices are for wood on the shelf, ready to go.

“What we bid today, is the market today. It’s the truest market price we can get.” Logging and trucking costs and local knowledge are different for every sale and must be factored in, but the bid is reflective of the true stump price. “One of the cool things about WoodX is that it has levelled the playing field for everyone,” he continued.

It saves time and money by providing equal opportunities for the large forest companies and the single truck operator. “Knowledge is key to the best efficiency.”

woodxdeLa Mothe began WoodX about 14 years ago and his prior background reflects both the turbulent nature of natural resource industries in B.C. and the opportunities that arise with their fluctuations. He has a background in geophysics and was involved in the mining industry until it was hit by one of its periodic commodity price slumps. He became a contractor for BC Timber Sale until a slump in lumber prices hit that sector. “Then I moved into high tech, computer networking for large corporations. I did some rewarding jobs but the tech industry is very stressful.” He switched locations, from Vancouver to Penticton, B.C., and reverted to forestry writing code and becoming an active bidder in the BC Timber Sale program. That required gathering accurate information to formulate a competitive bid.

WoodX emerged from that process. It comprises a wealth of data ranging from a region’s bidding history to the people making the bids. WoodX is used by mills, loggers and traders to learn the prevailing timber prices and who owns which sale. It provides the activity levels of bidders on each sale and by geographical area. WoodX users can also acquire timber sale management experience in terms of open to bid sales and the subsequent tracking of where wood is delivered.

“The key is the data base in the background,” emphasized de La Mothe. WoodX provides what he called a relational data base, which essentially links other relevant lists together. The upshot of that is the ability to view many data sources in a single frame without spending time and effort hunting for individual pieces of information needed to formulate the most cogent bid. “WoodX has evolved as a default tool for industry. Loggers to buyers can use it without having to learn a program.”

The WoodX data bank requires constant upgrading to maintain its timeliness and accuracy, and through that the value of the information it offers prospective timber sale bidders. de La Mothe said he and his staff work diligently to accomplish that. He is a strong advocate of the BC Timber Sale process in general and the function it fills in B.C., Canada’s largest timber producer by volume. “I believe BC Timber Sale is the most efficient, effective marketer of wood in North America. It really is a success story as far as getting the wood out and creating a market for it,” he summarized. And through that exercise in market dynamics for today’s wood, it provides valuable insight into future timber type demands and trends.