Haemorrhaging Cash with logging of your forest? Your first move is to bring forest value recovery under control

Like most forest owners you may entrust harvest to a third party, so the value decisions for your trees, are contracted to those whose imperatives are around production per day, not value.

This can easily run counter to receiving most value from your logging event or whole business model.

To achieve all possible value from forest harvest (value focused) requires additional attention beyond that which a production ethic (tons focused) will drive on its own, and yet many logging and forest businesses place most attention on production.

Facing off against this paradox, is the key to achieving maximum value from a forest at harvest.  It requires a mix of planning, economics, mathematics, logistics, culture and discipline.

Haemorrhaging value can occur at many points in forest harvest.  Resulting lost forest value recovery, and the suboptimal returns that follow, just don’t make sense, after waiting so long for trees to grow.  The angle cut log, the unpulled stem left on the hill, a best log in the ‘cheap’ log pile, the high stump, are the operational nuances, all leading to potentially massive lost value.

As forest owner you can programme activities to improve your fortunes, and ensure all possible cash from harvest goes into your bank, instead of being lost forever.

Here are solid, proven behaviours to ensure you make more money.  Bring them home to your forest operations:

  1. Have a Forest Value Recovery Plan.  Having no FVR plan is a sure way to throw away a few percent from your potential bottom line.  Decide precisely how you want your harvest to proceed in financial and forest value recovery terms, and put this in writing well ahead of harvest and review often.  Communicate it, and work it.
  2. Bring Forest Value Recovery Knowledge into your mainstream activities.  For a forest owner FVR knowledge is like money in the bank, only you can use it more than once.   If you don’t know enough to be sure about the process, learn more and bring the knowledge and required culture into your organisation and relationships.  And measure your gains, share the spoils so you are sure that you are not the only one who is interested in this discipline.  Tesy differential logging rates per log grade value and bonus structures, and rewards for high performance, mix it up to keep everyone alive and attentive.
  3. Grow professionalism and appropriate culture.   Poor culture is a forest value killer, let alone the hammering it gives your staff turnover figures.  Connect with your people like you mean it.  How to do this?  Actually mean it.  Those organisations that master this will still be here through the next downturn. You will be wise to measure, analyse and improve your company and crew culture.  Lift the care factor in your operations and recognise professionalism as if it were golden.  It is.  You can make your operations safer, more productive and more profitable, just by winding this dial up.
  4. Communicate well about forest value recovery.  Ensure that the forest value recovery message comes from the top, to the bottom, and back up again.  Make it something they care enough about to talk about it in their weekends.  Over to you for the how on this one.  Your providers, log makers, contractors, managers and executives all need to be engaged with your plan.  Many initiatives for improvement can come from the people on the forest floor, but only if the whole chain of command is aligned about value recovery and can capitalise on these signals.
  5. See Forest Value Recovery as part of a productive harvest operation.  If you hear this in your operations, consider it a serious red flag for culture which needs improvement.  Ensure everyone feels impelled, rewarded and recognised for hunting value as much as you are.  Improving forest value recovery culture, education and planning will often enhance both productivity and value recovery.

Learning to recover all possible value from your forest, may seem a complex or daunting task.  But most of the necessary solutions are simple and common sense once you build your own understanding, and lift the value recovery capability and culture in your organisation.

Plan and educate for better forest value recovery, build a better culture in your business, and you will improve your forest fortunes.  Guaranteed.

James Powrie B.For.Sc (Hons)

James Powrie is a Freelance Forester and has worked in all aspects of forestry since starting with the NZ Forest Service in 1984.  He offers Operations reviews, Education, Planning Assistance and Coaching for Forest Owners, Directors, Investors and others wanting to Maximise Forest Value Recovery at Harvest. He is also available for conference sessions and workshops by arrangement.

james@forestvaluerecovery.com    |   +64 272 757757    |    www.forestvaluerecovery.com

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