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Contracts for cuts along powerlines might be the best hope for small logging companies.
File photo/Houston Today

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Stumpage cuts down on profit

The best hope for small logging companies may not be in the forest.

Members of the Morice Forest Salvage Society are banking on gaining contracts to log roadways and powerline cuts.

To be a member of the society, a company cannot log more than 15,000 metres per year individually. Smaller companies are the hardest hit by stumpage fees because they do not have the volume to cover operating costs.

These contracts would allow loggers to clear-cut areas in the right of ways without hefty stumpage fees or silviculture levies.

Cutting along power lines can be tricky and potentially costly if any of the trees happen to fell a power line.

“It’s good if it goes well, but if you happen to knock a transmitter out, you could be looking at paying the cost of the man hours and be in the hole,” Steven Wright, society president said.

Logging along roads could offer less danger, but would be done on a case-by-case basis.

“You wouldn’t be able to go to hick roads where no one travels and clear cut,” Wright said. “But it could be the best option if you take less than one hectare.”

The Burns Lake District Manager with the Ministry of Forestry is still ironing out the details. In the meantime the new, Memorandum of Understanding (MOU) with the ministry, offers a best case price of $15.05 per metre of pine with, around $9 stumpage and $6 silviculture levy. The prices for wood vary on type and quality, with some of the grey wood working out to be the best deal because of lower stumpage.

“When the market for wood is good, stumpage can be slow to catch up, so those are the good times, but the market is slow now,” Wright said.

The agreement is a three-year term to be reviewed annually.

“If it’s an average $38 per log and the are 38-40 metres, it costs the logger $20-25,” Wright said. “With operating costs to get the wood to the mill, you are looking at $30 per log. The most a logger can afford to pay is $8 for stumpage, so it’s hard to operate on a profit.”

If loggers don’t want to go by the tabular rate for type of wood, they can get the area cruised to assess values, but the professionals to do that are costly and it could end up costing.

“You have to look at the scenario you want to log,” Wright said.

The society formed last spring as a way for Houston loggers to purchase wood.

Each company pays a $100 membership fee and $1,000 deposit for wood each year. At the AGM, the society decides who to donate any leftover funds to.

This year the money will go to the Houston Fire Department, the Museum Society, the Village of Granisle and Bulkley Valley Search and Rescue.

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