Daily Operations of Managed

Transcription

1 Green Crow Management Services Daily Operations of Managed Timberland in the Pacific Northwest 2010 National Forest Landowners Conference 1

2 Who We Are Established in 1983 with managing 16,000 acres of timberland on Washington State's Olympic Peninsula Provide timberland management services to individual and institutional investors 2010 National Forest Landowners Conference 2

3 Geographic Expertise & Focus U.S. Northeast U.S. Northwest New Zealand United States New Zealand 2010 National Forest Landowners Conference 3

4 Typical Pacific Northwest Timberland 2010 National Forest Landowners Conference 4

5 Regulation Oregon Forest Conservation Act of 1941 Forest Practices Act of 1971 Washington Forest Practices Act of 1946 Another Forest Practices Act of National Forest Landowners Conference 5

6 Local Representation Oregon Forest Industries Council Washington Forest Protection Association Communication about working forests Government relations and regulation policy Education providing training for teachers 2010 National Forest Landowners Conference 6

7 Timberland Manager = Relationship Manager Objective: Grow Assets of the Company/Client Managing Relationships Client Regulator Contractor Sales and Marketing Employees 2010 National Forest Landowners Conference 7

8 Inspiration 2010 National Forest Landowners Conference 8

9 Client Relationships Private owners Green Crow and affiliates Parent Company Partnership companies Institutional owners Timber Investment Management Organizations GMO, FIA, etc National Forest Landowners Conference 9

10 Seattle Portland X 2010 National Forest Landowners Conference 10

11 Regulatory Issues Federal: Endangered Species Act, Clean Water Act State: FPA, SMA, GMA other RCW s Local: Additional to above, mostly development related 2010 National Forest Landowners Conference 11

12 Regulatory Relationships Washington State Forest Practices Act and Rules and Regulations. Department of Natural Resources (referee) Stakeholders: Landowners Dept. of Fish and Wildlife Dept. of Ecology Tribes 2010 National Forest Landowners Conference 12

13 2010 National Forest Landowners Conference 13

14 BMPs for sediment control 2010 National Forest Landowners Conference 14

15 Silt Happens 2010 National Forest Landowners Conference 15

16 Resource Damage? 2010 National Forest Landowners Conference 16

17 Slide Initiation Point 2010 National Forest Landowners Conference 17

18 Debris Flow deposition 2010 National Forest Landowners Conference 18

19 Jan 2009 Storm Damage 2010 National Forest Landowners Conference 19

20 Road Improvement RMAP requires landowners to remove barriers to fish migration Private owners have spent over $200 million since 2001 on RMAP 2010 National Forest Landowners Conference 20

21 Contractor Relationships Cutting contractors Logging contractors Truckers Road Construction contractors Silvicultural Nurseries Lessees 2010 National Forest Landowners Conference 21

22 Marketing Relationships Local/Regional Sawmills/Plywood Plants Fiber/ Biomass consumers Export log brokers Shake/Shingle mill owners Misc. minor forest products 2010 National Forest Landowners Conference 22

23 Employee Relations Vertical vs. Horizontal Managing your boss Communicating with Accountants,H/R,IT,etc Communicating the mission Successional issues National Forest Landowners Conference 23

24 Forest Certification Is it necessary? Sustainable Forestry Initiative Forest Stewardship Council The industrial model Accepts American Tree Farm Certification Higher admin cost in South vs. PNW No market premium May be required for: Access to markets To satisfy investor/shareholder demands The environmentalist model Does not accept ATF Compliance costs prohibitive Highly restrictive of even-age management No market premium Public Timber Managers are being pressured to pursue 2010 National Forest Landowners Conference 24

25 Timber Harvesting Harvest planning and scheduling Regulatory restrictions Rivers, stream, wetlands Steep slopes Endangered species and habitat Logging cost Ground or cable based on terrain 2010 National Forest Landowners Conference 25

26 Forest Practice Application & Map 2010 National Forest Landowners Conference 26

27 Sale of Standing Timber Pay as cut (scale sale) Lump Sum (cash sale) Volume risk mitigated Buyer has lower appraisal costs Seller assumes higher h admin costs Commonly used when volume id difficult to determine(partial cuts) Buyer assumes volume risk Buyer assumes higher appraisal costs Payment terms spread over term of sale (defined by seller) Sll Seller has lower admin costs Widespread use throughout PNW 2010 National Forest Landowners Conference 27

28 Timber Sale Results 20-May Scale Sale Lump Sum sale Acres year old WH/DF 45 year old WH/RA 70% cable logging 75% cable logging $/MBF Total $ Green Crow Appraisal $ 450,610 Export Broker $ 474,044 Sawmill $ 438,678 Log broker $ 460, National Forest Landowners Conference 28

29 After Harvest 2010 National Forest Landowners Conference 29

30 Silviculture Site preparation treatment Physical & chemical options Planting trees per acre 10ft. X 10ft. Spacing $ per tree in the ground Pre-commercial thinning age typically years Reduce stocking to 450 trees per acre 2010 National Forest Landowners Conference 30

31 Silviculture Continued Competing vegetation Chemical and thinning (slashing) 2010 National Forest Landowners Conference 31

32 Other Values Highest Best Use Development Recreation Communication towers Rock resources Minor forest products Floral Greens Cedar shakes & shingles Noble fir boughs 2010 National Forest Landowners Conference 32

33 Evaluating Conservation Values Seattle 2010 National Forest Landowners Conference 33

34 Potential Value Carbon storage Wind power 2010 National Forest Landowners Conference 34

35 Technical Analysis Markets for land, logs, & wood products Growth & yield of the forest Environmental li impacts of ff forestry All have financial implications Analysis supports better decisions Our clients want to know why 2010 National Forest Landowners Conference 35

36 Tree Growth 2010 National Forest Landowners Conference 36

37 80 Stand Biological Growth 70 Growth slowing to discount rate 60 indicates time to harvest Planted Total Volume of Trees (mbf/ac) Annual % Growth 40% 35% 30% 25% 20% 15% 10% 5% 0% 2010 National Forest Landowners Conference 37

38 Log Price vs. Moving Average $/mbf Nominal dollars % 40% 20% 0% -20% -40% -60% -80% % difference from 10-period avg. Douglas-fir #2 Sawmill 10-period moving average 2010 National Forest Landowners Conference 38

39 Timber Option Value Biological growth 6-12% / year Current downturn in U.S. housing Change in market value / year Strategy Harvest opportunistically Hold and grow 2010 National Forest Landowners Conference 39

40 Geographic Information Systems 2010 National Forest Landowners Conference 40

41 Reporting Harvesting 2nd Quarter YTD 2010 Budget MBF 4,100 7,200 21,524 Net Sales $1,000,400 $1,872,000 $4,520, Net$/MBF $244 $260 $210 Silviculture Loc./Comp./ Stand Type Acres Description Status 2434/ 26,27(28N- Hand 8E) Spray 24 Release ease Spray Complete e 2328/ 14,23(28N- Hand 8E) Spray 124 Release Spray Complete 3006/ 30(28N- Hand 9E) Spray 8 Release Spray Complete 2010 National Forest Landowners Conference 41

42 Summary Green Crow has been Managing Timberlands for 25 years. Thorough knowledge of forests, log market, & regulations Building strong relationships Analyzing information for planning, operations, and reporting Providing a service and value our clients 2010 National Forest Landowners Conference 42

43 Contact Us Doug St. John Phone: (Seattle) Tom Swanson Phone: Green Crow Management Services, LLC P.O. Box 2469 Port Angeles, Washington, National Forest Landowners Conference 43