Financial Feasibility of a Log Sort Yard Handling Small-Diameter Logs: A Preliminary Study

The value and use of the trees removed in fuel reduction thinning and restoration treatments could be enhanced if the wood were effectively evaluated and sorted for quality and highest value before delivery to the next manufacturing destination. This article summarizes a preliminary financial feasibility analysis of a log sort yard that would serve as a log market to buy and sell small-diameter logs in western Montana. We based our evaluations on equipment for a medium-sized log sort yard that would preprocess and sort 33 million board feet of small-diameter logs per year to seven different products. The delivered log input costs represent 78.1% of the total sales revenue, whereas the yard’s operating costs account for 17.7% of the revenue. The log sort yard’s operating cost would be $3.74/piece or $79.53/thousand board feet. Douglas-fir (Pseudotsuga menziesii) would make the biggest contribution to the yard’s gross margin because this species both represents the largest volume (45% of the input log volume) into the yard and produces high-value products (house and veneer logs). Improved knowledge regarding wood market conditions and local log supplies is a prerequisite to understanding a log sort yard’s financial feasibility.