Harvesting Operation Cost Analysis

Transcription

1 - 1 - Harvesting Operation Cost Analysis Penn College Earth Science Center River Property Fall 2006 Greg Wiltsie, Erick Butters, Jeremy Sox Timber Harvesting and Equipment FOR 252 Dr. Ringling The costs figured below are based on an hourly and daily basis. The charges are figured on the assumption that we will be working approximately 1,800 hours during the entire year, this equates to working a total of 240 days. The information from which the costs were figured is listed below. Costs Figured per Hour Consulting Fee = $0.00 New John Deere 450 J Bulldozer Payments= $12.87 Bulldozer Depreciation Rate = $4.31 John Deere 440 Skidder Payments = $0.00 Skidder Depreciation Rate = $2.67 Ford 9000 Log Truck Payments = $0.00 Log Truck Depreciation = $3.78 Saws, Wedges, Peavey s, Tapes, Mauls, First Aid Kits = Owned by Partnership Maintenance = $2.22 Repairs = $2.78 Life Insurance = $0.64 Logging Liability Insurance = $0.44 Health Insurance = $4.54 Bulldozer Insurance = $0.56 Skidder Insurance = $0.56 Trucking Costs = $21.08

2 - 2 - Fuel/Lube/Filter Costs of All Machines and Saws per Day = $11.31 Salaries = $46.35 Retirement = $2.70 Workman Compensation = Partnership-Not Necessary $0.00 Total Hourly Costs = $ Total Job Cost ( x 18.3) = $2, Costs Figured per Day Consulting Fee = $0.00 New John Deere 450 J Bulldozer Payments= $96.56 Bulldozer Depreciation Rate = $32.33 John Deere 440 Skidder Payments = $0.00 Skidder Depreciation Rate = $20.00 Ford 9000 Log Truck Payments = $0.00 Log Truck Depreciation = $28.33 Saws, Wedges, Peavey s, Tapes, Mauls, First Aid Kits = Owned by Partnership Maintenance = $16.67 Repairs = $20.83 Life Insurance = $4.80 Logging Liability Insurance = $3.33 Health Insurance = $34.05 Bulldozer Insurance = $4.17 Skidder Insurance = $4.17 Trucking Costs = $ Fuel/Lube/Filter Costs of All Machines and Saws per Day = $84.83 Salaries = $ Retirement = $20.28 Workman Compensation = Partnership-Not Necessary $0.00 Total Daily Costs = $ Work Site Figures Average Volume per Acre = 4,931 Bd. Ft. Average Volume Taken per Acre = 3,254 Bd. Ft. Average Volume per Tree = 400 Bd. Ft. Trees per Acre = 75 Total Acres = 9 Average DBH = 17 Inches Average Height = 1 ½ - 2 Logs Board Footage per Truckload = 3,000 Bd. Ft.

3 - 3 - Percentages of Tree Species Red/Black Oak = 80% White Oak = 5% White Pine = 5% Beech = 3% Red Maple = 5% Birch = 2% We collectively fell, limb, buck and load four trees per hour, working an eight hour day, leaving one half hour for lunch. This equates to the crew cutting approximately 30 trees per day depending on conditions and other factors that may effect production. With the average volume per tree coming in at 400 board feet, we would be cutting approximately 12,000 board feet per day. With the log truck capable of hauling 3,000 board feet we would be taking an average of 4 truckloads a day to Kuhn s Lumber which is 20 miles from our worksite. The two cutting units which are 9 acres in size have a total of 29,286 board feet of timber. Therefore, if we cut 12,000 board feet daily we would have the job finished in approximately two and one half days or 18.3 hours. Below are many of the costs that are associated with the logging and trucking industry and these costs will be deducted from the aforementioned job in order to find the net profit we could expect to make on this sale. New Machine and Associated Costs 2007 John Deere 450 J Bulldozer = $80,000 Winch = $12,000 Back Screen = $1,000 Brush Guard = $850 Heated Seat = $500 Limb Risers = $2,000 Fairlead Rollers =$650 Pennsylvania 6% Sales Tax = $5,820 Interest = (97,000-10,000)(5+1)(.05) 2 x 5 5% Interest over 5 Years = $13,050 Total Bulldozer Cost before Tax and Interest =$97,000 Total Bulldozer Cost After Sales Tax and Interest = $115,870 Total Bulldozer Cost per Day = $96.56

4 - 4 - Machine Rates and Estimated Fuel Costs Off-Road Diesel = $1.95 per Gallon Highway Use Diesel =$2.55 Gasoline = $2.17 Bulldozer = 48 Horsepower Fuel = 0.037xHPxCost/Gallon Fuel = $3.50/Hour Lubes and Filters = $1.05/Hour (30% of Fuel Costs) Total = $ 4.55/Hour Skidder = 70 Horsepower Fuel = 0.037xHPxCost/Gallon Fuel = $5.00/Hour Lubes and Filters = $1.50/Hour (30% of Fuel Costs) Total = $6.50/Hour Chainsaw =2 ½ Horsepower Fuel = 0.037xHPxCost/Gallon Fuel =$.20/Hour Lubes and Filters = $.06/Hour (30% of Fuel Costs) Total = $.26/Hour Total Fuel, Lube and Filter Costs per Hour = $11.31 Total Fuel, Lube and Filter Costs per Day = $84.83 Machine Depreciation Rates Depreciation = Purchase Price Salvage Price (20% of Purchase Price) Machine Life Bulldozer = $97,000 - $19, Years Bulldozer Depreciation = $32.33 Daily or $4.31 Hourly Skidder = $60,000 $12, Years Skidder Depreciation = $20.00 Daily or $2.67 Hourly Log Truck = $85,000 $17, Years Log Truck Depreciation = $28.33 or $3.78 Hourly

5 - 5 - Trucking Costs Log Truck = 3 Miles/Gallon (Road Time plus Loading and Unloading Costs) $2.55/3 = $.85 per Mile for Fuel Log Truck = Oil, Filter and Wear = $15.09 Log Truck License = $1,250 Annually $1,250/12 = $ Monthly Heavy Highway Use = $ Annually $388.50/12 = $28.20 Monthly Non-IFTA Sticker (Pennsylvania Use ONLY) = $5.00 Annually Total Trucking Cost per Hour = $21.08 Total Trucking Cost per Day = $ Maintenance and Repair Repair/Tires = $5,000 Annually Maintenance = $4,000 Annually Total Repair Cost per Day = $20.83 Total Maintenance Cost per Day = $16.67 Total Maintenance and Repair Cost per Day = $37.50 Total Maintenance and Repair Cost per Hour = $5.00 Insurances Liability = $800 Annually (Quarter Million Dollar Coverage) $800/12 = $66.67 Monthly Health = $227 monthly, $25 co-pay Aetna Insurance Group 3 person crew X $227 each = $ Monthly Life = $32.00 monthly (Quarter Million Dollar Coverage for 20 year old) - AIG 3 person crew X $32 each = $96.00 Monthly Skidder = $1,000 Annually $1,000/12 = $83.33 Monthly Dozer = $1,000 Annually $1,000/12 = $83.33 Monthly Log Truck Vehicle/Collision Insurance = $3,099 Annually $3,099/12 = $ Monthly Total Insurance to be Paid Monthly = $1,268.58

6 - 6 - Taxes Federal Withholding Tax = 8.92% Social Security Tax = 6.20% Medicare Tax = 1.45% State Withholding Tax = 3.02% Local Withholding Tax = 1.70% Total Taxes = 21.29% Salaries, Retirement and Workman s Compensation Hourly Pay = $15.00 Retirement = Hold 3% of Pay and Match 3% for Retirement Workman Compensation = Match 29% of Hired Workers Pay Daily Salary = $ Daily Salary 3% = $ Daily Salary 21.29% Taxes = $85.89 Retirement Owed = $6.76 Workman s Compensation = $25.68 Daily Salary + Retirement Owed ( % + 3% Matching) = $ Total Daily Pay + Workman s Compensation = $ However, since our logging crew has decided to go in on this endeavor as a partnership workman s compensation will not be factored into our daily pay. Total Daily Pay Workman s Compensation = $ $ X 3 = $ Total Retirement Pay Owed Daily = $20.28 Stumpage Values 3,254 Board Feet per Acre X 9 Acres = 29,286 Total Board Feet Red Oak, Black Oak (80%) = 23,429 Board Feet $318/MBF = $7, White Oak (5%) = 1,464 Board Feet $190/MBF = $ White Pine (5%) = 1,464 Board Feet $69/MBF = $ Red Maple (5%) = 1,464 Board Feet $200/MBF = $292.80

7 - 7 - American Beech (3%) = 879 Board Feet $56/MBF = $49.24 Birch (2%) = 586 Board Feet $56/MBF = $32.82 Total Value of Stumpage = $8, Mill Values Gross Profit Net Profit 3,254 Board Feet per Acre X 9 Acres = 29,286 Total Board Feet Red Oak, Black Oak (80%) = 23,429 Board Feet $411/MBF = $9, White Oak (5%) = 1,464 Board Feet $296/MBF = $ White Pine (5%) = 1,464 Board Feet $240/MBF = $ Red Maple (5%) = 1,464 Board Feet $379/MBF = $ American Beech (3%) = 879 Board Feet $101/MBF = $88.78 Birch (2%) = 586 Board Feet $101/MBF = $59.19 Total Value of Medium Grade = $11, Difference between Mill Value and Stumpage Value = $2, Difference between Gross Profit and Costs Net Profit = $2, $2, = $785.01