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Timber Market Update & Outlook

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Friday, April 5, 2019 - 7:00am

Amy: How are Mississippi’s timber markets so far this year?

Marc Measells: Amy, the markets so far this year are showing upward trends in the prices forest landowners are receiving for their trees.  Overall, the statewide average this quarter are higher compared to the 4th Quarter of 2018.  This is very typical for the 1st quarter of each year though.

Amy: Why do we see higher prices during the 1st quarter?

Marc: It is important for landowners to understand supply and demand issues when talking about timber prices.  During the 1st quarter of most years, mills face a supply issue.  They have a problem getting trees cut and hauled to the mill because of the excessive amount of rain we typically receive in January, February, and often through March.  These extremely wet conditions eliminate many forested areas from being harvested due to the amount of environmental damage potentially caused during harvest operations.  However, not all properties will be impacted as heavily as others.  Depending on the soil type, topography, and other factors, some properties will dry out sooner allowing logging crews to harvest timber without causing major issues.  If a landowner is lucky enough to have areas that can be harvest this time of year, they typically see higher prices because when the mills start running low on trees to process, they typically pay a higher price to make sure they have enough trees to run the mill.

Amy: How can we know that mills are running low on trees to process?

Marc: The easiest way is to drive by a local mill.  This time of year, if you do not see many trees stacked around the mill, they are typically processing the trees as quickly as the log trucks are delivering them.  Of course, I highly recommend landowners worker with professional foresters and loggers during any harvest planning and operations.  These professionals will know which mills within reasonable hauling distance to your land are looking for trees to supply their mill.

Amy: What can landowners expect for the remainder of 2019?

Marc: We all know that this wet weather will eventually leave us for hot and dry conditions around the state.  This is bad news for landowners with properties that can be harvested during these wet times but good news for those with properties that can only be harvested when it is drier.  Overall, we should see timber prices level off this year with price fluctuations occurring locally.  Price forecasts are projecting higher demand for forest products which will hopefully lead to higher stumpage prices paid to forest landowners.

Amy: That is good news.  Are there other positives you would like to share with forest landowners?

Marc: Let me start by giving some bad news.  While this is not a Mississippi mill, the closure of the paper mill in Port Hudson Louisiana will affect many landowners in the southwestern part of the state.  I’m sure several forest landowners already know this, but a few mills around the state announced plans to expand production.  In addition to these expansions, a company announced a new pellet mill would be built in south Mississippi along with a new ship-loading terminal on the Mississippi Gulf Coast.  These expansion and new mill will increase the demand, therefore competition, for trees grown by Mississippi forest landowners.  The increased competition will benefit landowners within a 50-70 mile radius of these mills.

Amy: How can landowners keep up with timber prices?

Marc: For a general idea of timber prices, the Extension website has current and historical prices available.  They can go to extension.msstate.edu and look at timber prices back to 1957.  Currently, we report timber prices on a quarterly basis and have divided the state into four regions.  Landowners should understand these prices are a good price reference but do not reflect what an individual landowner will receive for their timber.  Timber prices vary tremendously from one timber sale to another based on many different variables.  I highly recommend landowners work with a professional forester when conducting a timber sale.  These professionals are a tremendous asset because they know the local market details and will help the landowner receive the best price possible for their timber.

Department: Forestry

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