Timber values can range from a few hundred dollars per acre to several thousand dollars per acre. It takes a trained eye to evaluate the volume of wood and someone in touch and current with the timber market to be sure that you or your client capture the full value of your timber investment. There are several methods of inventorying timber and several ways to ensure you are getting the highest values for your timber. Green Hill Land & Timber, LLC uses these methods and other tools necessary to inventory or cruise timber. Our initial inspection can generate a lot of excellent information and knowledge that the landowner can utilize. Though we specilize in timberland, farm land and recreational land, it may be that the highest and best use of your land may not be timberland and you need to know that, too. Many times we have seen landowners hesitant to employ foresters to inventory their timber investment. They feel that the fee is too high or they want to save the commission expense for selling the timber. These Landowners had rather negotiate the sale even though there have been tens and even hundreds of thousands of dollars lost by people not having an accurate and current inventory.
For instance, we met with a landowner to inspect his timber. There were several hundred acres of very good pine timber but the landowner had no idea of the value. We said early in our inspection that the timber was worth at least $500,000 and the landowner said we could write him a check for that amount. After further inspection of the timber and making certain the timber was there, we said the timber was at least worth $750,000 and the landowner again said we could write him a check for that amount. At the end of the inspection, we told the landowner we had agreed on a commission to be paid upon selling the timber and the timber was worth in excess of $1,200,000 but would have to be verified by a timber inventory. To make him the most money, the timber needed to be sold on a lump sum sealed bid sale. This was done and the timber sold for around $1,500,000. There are a lot of landowners that get taken advantage of and it is Green Hill Land & Timber’s responsibility to provide our client with the best service possible to make certain they get all their timber is worth. Timber is very valuable and it is worth every penny to have it evaluated. As you can see, the fee this client paid certainly paid off for him many times over.
Inventory and Financial Projections
An inventory can be used for cash flow projections, tracking timber investments and estate planning. Having this inventory data gives the landowner the power of knowledge to make sound decisions. Most people who sell timberland and timber take this step 1 to 4 times in their life. There are amateurs out in the market trying to out trade the trained professional doing this every day. You need a trained professional to assist in your timber evaluation and projections. Your stock portfolio is probably current and your timber portfolio should be as well. Timber as an investment is profitable and should be managed to provide you with the optimal or highest return possible. Green Hill Land & Timber knows what to look for and provides excellent data in a timely manner.
Some examples of the tool foresters use in the woods are as follows:
- Cruise Vest – An orange or red vest worn by foresters while inventorying timber. The vest has several pockets used to put pencils, flagging tape, compass, clinometer, water, and anything else needed.
- Compass – An instrument for determining direction, consisting essentially of a freely suspended magnetic needle that points to the magnetic north. It is used to run cruise lines.
- Clinometer – An instrument for determining angular inclination, as of slopes. This instrument is adapted to forestry to measure tree heights and in mountain areas, grades.
- Diameter Tape – A tape measure calibrated to measure the diameter of a tree by measuring around the tree. (Circumference divided by Pi = Diameter)
- Tally Book – Book carried for recording field data while cruising timber.
- Tally Card – Card used to write down field data on.
- Data Recorder – hand held computer type recorder that field data is recorded in and can be downloaded into a computer.
- Increment Borer – A tool used to bore into a tree and extract a round plug of wood from the tree. Plug provides information on age, growth rate, site index and a basic history of the life of the tree.
- Biltmore Stick – tool used to help in gauging tree diameters and number of logs per tree.
- Prism – A prism is used in determining the trees in or out on a variable plot radius when conducting a prism cruise.
- Calipers – Used to measure tree diameters.
These are a few of the tools utilized when taking data from the forest. We will get into the types of timber cruises and the data recorded at a later date.
Initial Inspection of Property or Tract
When making an initial inspection of a property, it is advantageous to have as much information as possible on the tract for your review. The more information you have and the more current this information, the better advice or decision we can provide. The landowner may provide information on the tract, but if they do not, there are several types of information you need and several places to obtain this information.
The first thing you’ll need is a clear and current aerial photograph. There are several places you can get these photographs and several different types of photographs. The most common photos are from the county tax assessor’s office. These maps are blue lines that usually are fairly clear and distinguishable. Many of the counties have color aerials now. The boundary lines are marked on the map as close as possible to reality and they are typically on a scale of 1” equals 660 ft. in Georgia and 1” equals 400 ft. in South Carolina. The Farm Service Agency (FSA) has photos that are black and white and more recently have upgraded to color. These maps are typically used to keep records for the US Department of Agriculture with offices in most every county and the national office in Salt Lake City, Utah. The FSA county maps can be copied but they will not let these maps out of their office. Some smaller parcels can be printed on the FSA color printers. You can order these maps from Salt Lake City for a fee. There are several other type maps available of varying scales such as topographic maps, color infrared photos, soils maps and more. We can interpret different types of information from these maps and photos but that is a topic for another day. There are several businesses that will take custom aerial photos for you of whatever tract of land you wish. Many timber companies and industries have their own aerial photos that, on a very limited basis, they will lend out.
The Soil Conservation Service, now under the Department of Natural Resources (NRCS), has soil maps available for almost every tract of land and a free book for almost every county. If they do not have your tract mapped, they will do it upon request. These maps delineate all of the soil types on the subject property. For each of these soil types, there are detailed productivity reports for woodlands, wildlife, water conservation, and crops. These maps are very handy in determining the site index (soil productivity for timberland) of a tract, which will help determine timber growth and investment potential.
The use of aerial photos is essential for Land Brokers & Foresters to begin the process of developing a plan to achieve the landowner’s goals. Some of the things we can see from the aerial photo are timber types, size of timber, timber density, areas with little or no timber, fields, roads, boundaries, ponds, beaver ponds, access, and features of surrounding property that could be good or bad for the subject property. As you can see, much can be learned in a short period of time about a tract of land and timber by an experienced trained eye. These maps, mapping software and photos are excellent tools that Green Hill Land & Timber utilize to make sure our clients get the best possible service. Knowledge really counts when you want the best return possible from your land and timber investment.