Price swings have little effect on timber industry momentum

STARKVILLE, Miss. -- Ongoing construction and expansion of lumber mills in Mississippi like the one taking place at Southeastern Timber Products’ Ackerman sawmill are encouraging signs for the state’s forestry industry, despite market fluctuations.

“These new and expanded mills will increase the demand for raw timber, which can help absorb the state’s abundant standing timber supply and provide additional outlets for landowners to sell their wood,” said Sabhyata Lamichhane, forestry economist with the Mississippi State University Extension Service. “Over the long term, increased mill capacity is likely to strengthen local timber markets, support higher stumpage prices, and promote more competition among buyers.”

The Mississippi Forestry Commission’s forest industry directory lists a total of 102 timber mills across the state, 60 of which are sawmills. The Mississippi Development Authority announced the expansion of the Southeastern Timber Products’ mill earlier this year.

Ten others are wood chip mills, and there are nine pole mills in the state. There are also six plywood, six cross-tie and five pulp paper mills in the state. There are also a few mills that manufacture particle board and oriented strand board, or OSB.

MSU Extension’s quarterly Mississippi Timber Price Report, which provides market data for statewide stumpage prices for forest products, shows that most timber product prices in the state declined slightly in the second quarter of 2025 from the first, but average sawtimber stumpage prices improved from a year ago.

In the second quarter of 2025, statewide averages for pine sawtimber were $21.73 per ton compared to $19.60 per ton a year before. Mixed hardwood sawtimber was $32.17 per ton in the second quarter of this year, an increase of $3.21 per ton from the second quarter average in 2024. Oak sawtimber averaged $42.55 per ton -- a one-year increase of more than $5 and a 17% gain from 2024’s fourth quarter average.

“The demand for sawtimber is what we call a ‘derived demand,’ meaning it depends on the demand for finished wood products such as lumber, OSB, and plywood,” said Lamichhane, who authors the report. “In the U.S., the lumber market is especially influenced by residential construction -- new home building, repairs, and remodeling account for more than two-thirds of total lumber use.”

Quarter-to-quarter changes for the pulpwood market were not as favorable, though prices are still better than a year ago. Pine pulpwood average stumpage prices fell from $3.57 in this year’s first quarter to $2.18 in the second one, but the average prices in the second quarter of 2024 was only $1.69. Hardwood pulpwood dipped to $4.50 in the most recent quarter from $6.20 in the previous one, but the average a year before was $4.17. Average prices for the most recent quarter were based on 132 timber sales across the state.

“Stumpage prices are shaped by a wide range of interconnected factors,” Lamichhane said. “These include local market dynamics, overall economic conditions, government policies, seasonal patterns, weather, and the unique characteristics of each timber tract, such as location, tree species, product type, site accessibility and proximity to processing mills.”

Rain surplus aids in forest drought recovery

Wet weather seen across the state for much of 2025 has provided an immediate benefit to the state’s forests in that it has allowed them an opportunity to recuperate from droughts experienced in the two preceding years, said MSU Extension forestry coordinator Brady Self.

However, damage done in drought years is not immediately reversible and may take several years to overcome, with small-scale individual tree mortality probable.

“During droughts, fine roots in a tree’s root system die, causing overall decline of tree health as its ability to obtain water and nutrients decreases,” Self said. “This can result in crown dieback in the form of twig and small branch wilting or death. If this is severe enough, large-scale tree mortality like we saw in 2023 can result. Years with surplus precipitation, especially during the spring and summer months, allow the system to ‘recharge’ and recover somewhat.”

Traditionally, Self said, higher prices are paid for tracts with timber that can be logged during wetter site conditions and winter months when mills contend with lower wood availability due to wet site conditions.

“While this is still true to some extent, the price differential is smaller in today’s markets due to the sheer amount of stumpage available,” he said. “There are small price increases during winter or wet months, but the price swings are not as significant as they were historically.”

When lumber prices do rise, sawmills ramp up production to take advantage of higher profits, meaning they buy more sawtimber. In turn, timberland owners are more willing to sell when mills are paying higher prices, leading to increased sawtimber prices and boosting harvest income for landowners.

“When the market is weak, landowners can consider timing their timber sales to get better returns,” Lamichhane said. “If possible, delaying a sale until market conditions improve may lead to higher prices. Keeping up with local and regional timber market trends can help landowners make more informed decisions about the optimal time to sell.”

View recent and archived timber price reports for Mississippi online at https://shorturl.at/zLW6h.