Timber auctions now held quarterly in Hubbard County
Hubbard County's new aggressive forest policy kicked off Monday with equally aggressive bidding by area loggers.
One of the 21 tracts auctioned went for 74 percent above the appraised price. Another sold for 60 percent above the appraisal.
That's not unusual, said Land Commissioner Mark Lohmeier.
While other counties struggle to sell their timber, Hubbard County loggers have fairly easy proximity to three mills.
"It's tough for them," Lohmeier said of surrounding counties, where loggers have to truck wood 100 miles to have it milled.
Between Potlatch, Norbord and Cass Forest Products, Hubbard County loggers have much easier access to lumber markets.
In late fall, the county board approved doubling the county's timber harvest from the previous decade. Up to 5,000 acres will be harvested in the upcoming decade with the county holding four instead of three timber auctions.
Lohmeier said the plan is to get a better mix of old and young trees throughout county forestland.
Monday's timber auction was typical of most. The classroom at the Public Works Building filled with loggers. Most entered a bid.
A projector screen describes each sale as to how many cords of each type of wood are offered for sale.
An appraised price is listed, which a sale rarely goes for.
Most loggers bid up the prices substantially.
County commissioners have questioned whether appraised prices are being set too low, but a long-established practice has been used to ensure logger and county success, Lohmeier said.
He averages the cord price of the last three auctions and lops 30 percent off the top to give bidders a fighting chance to make a profit.
To ensure parity between bigger logging companies and one-man operations, during the first round of bidding, no single bidder can take more than 25 percent of the bids in the first round.
The land office tracks percentages during the bidding.
It's an easy, congenial setting. Loggers whose cell phones sound off during the auction are ribbed and "fined" a mock $5.
Lohmeier acts as auctioneer. He laughs about his lack of "auctioneer-speak," and the ability to have bids roll off his tongue. But he's precise and understandable, if not a fast talker.
Loggers say they don't have time to view the tracts beforehand to see what they're getting into.
Dean White, a Laporte logger, wasn't a successful bidder Monday.
"Most of the wood went too high," he said. He'll be back in March for the second auction.
White is currently working on some contracts for private landowners, so he said he would remain busy in the interim.
Each logger gets a bidding manual describing the tract for sale, the terrain, the acreage, the length of the sale, whether it can be harvested winter, summer or either and how much of a down payment is required, typically 15 percent of the appraised price.
The remainder is due before the logger begins.
White jokingly asked if loggers could "bid down" a tract that wasn't particuarly attractive to anyone in the room.
They can't, by law, Lohmeier explained after the auction. And wood isn't appraised at current market value since the market in the forest lags behind the price at the mill.
Rod Hooker, a Lake Alice logger, said he won't expend the funds to view each tract of land throughout the county.
"It could take two to three hours a tract," he said. Between his time and gas involved in touring the county, he said he relies on the county appraisals to guide his bidding.
"Otherwise you spend a bunch of money and you may not end up buying," he reasoned.
Most loggers bid tracts in the vicinity of their equipment and of the type of lumber they can sell, Hooker said.
Serious bidders don't watch the monitor, Lohmeier pointed out. Their heads are in their notebooks. Almost everyone takes notes.
Smaller tracts that don't sell at the auction can be sold "over the counter." They are typically one-year sales in which the loggers must pay 100 percent of the appraisal up front.
Lohmeier acknowledges that logging is a tough business.
"Things are better here," he said. "We're blessed with proximity to good markets."