Report: Wood Supply Chain Component Costs Analysis

As part of the Wisconsin Forest Practices Study, Steigerwaldt Land Services and Forest2Market completed a cost analysis of regional wood supply chains. The report was published in November 2014, but apparently I forgot to post it. However, the information is still quite useful and, as I understand it, a follow-up study is in the works. The full report (pdf) is here. The summary of that document is presented below.

Project objectives Complete an assessment of wood fiber supply chain costs in Wisconsin, including a comparison to other U.S. regions, in order to address the question of how Wisconsin can continue to provide Project Objective sustainably-grown wood fiber to support a competitive wood-using industry and attract investment in primary forest-based manufacturing.
Results Wisconsin’s total delivered fiber cost for pulpwood compared to the U.S. Northeast region shows lower aspen and mixed hardwood costs and higher conifer costs. Both northern regions incur higher delivered costs compared to the U.S. South and Pacific Northwest. Analysis of individual supply chain costs indicate that Wisconsin’s costs vary when compared to other regions and species groups, with higher conifer stumpage and lower aspen and hardwood stumpage. Harvesting costs likewise vary, generally being lower than the Northeast and higher than the South. Wisconsin-delivered fiber costs typically include higher freight and “other” costs (handling, procurement, etc.) in most instances. The results of this study reflect a snapshot in time, as the data set included a summary of only four quarters (Q3, 2013 through Q2, 2014).
Conclusions Wisconsin and the U.S. Northeast will be at a competitive disadvantage when total delivered pulpwood fiber costs are compared to the South, due largely to differences in seasonal weather-related impacts on operability, such as prolonged spring breakup periods, along with other unique forest and operational characteristics. Wisconsin also has challenges inherent in the industry that appear to increase freight and “other” costs. Lowering costs or, minimally, being mindful of issues that increase these costs, such as restrictions limiting activity to winter months, will be a factor in maintaining Wisconsin’s position in the U.S and global timber industry.


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