Premiums on Certified Lumber

Samuel J. Radcliffe SamR at
Fri Sep 17 17:39:53 EST 1999

The chain starts with the consumer willing to pay a premium. Then the
lumber people have to decide based on that premium and the extra
handling, marketing, etc. costs they incur, how much they can pay the
sawmill for the lumber. Then the mill has to decide how much it can pay
for stumpage based on what it gets for the lumber less any extra
handling, marketing, etc. costs. Then the logger has to decide what he
can pay for stumpage knowing what the mill will pay for delivered logs
and knowing what his extra logging and handling costs will be. Then the
landowner has to decide if that extra stumpage (if there is any left
over) is enough to justify your management fee. You are stuck with
making an investment decision based on analysis of this very uncertain
chain of costs and prices and the size of the market. It's the classic
residual cost value of stumpage. Although it doesn't exactly happen
linearly, all of these factors sort themselves out in the long run.

My advice: don't be the first, be the best.


Karl Davies wrote:
> altruistic, but not THAT altruistic. <G>
> most of the effort, IMO.
> --
> Karl Davies, Silviculturist
> Northeastern Forestry Reformation List Server

Samuel J. Radcliffe
George Banzhaf & Company
225 East Michigan Street, Suite 210
Milwaukee, WI 53202
Voice:   414-276-2062        
Fax:     414-276-5206     
E-Mail:  SamR at                  

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