Timber Prices Exploding As Supply of Oak is Depleted

A 1000% jump in red oak timber prices being paid to private forest owners in Southern Wisconsin over the last 20 years, reveals a developing shortage of good quality timber in this region.  Other species have not all made such a dramatic value increase, but demand and prices are rising quickly for all forest products.

According to forester Jim Birkemeier of Timbergreen Forestry in Spring Green, this trend of increasing prices will continue well into the future.  "Twenty years ago, good timber was selling for up to $50 per thousand board feet in this region," says Birkemeier.  "The supply of good timber had always been greater than demand so prices were steady and low, making forest management unrewarding.  Things have completely changed.  We are quickly running out of good quality timber and demand is growing for low quality wood as well, bringing all timber prices into the range where forest management is now a profitable business on private lands."

Recent DNR publications state that Wisconsin timber as a whole is growing faster than it is being harvested in nearly every category.    In total acres, timber is the most plentiful crop in this state and the crop most important to our economy. 

Despite the abundance of trees, good timber is getting rare.  Sawmill managers from two of the biggest sawmills in the Midwest recently reported they can no longer get enough red oak logs to supply their mill fully. 

Observing stumpage price reports shows the recent explosion in the value of red oak.  Wisconsin DNR stumpage rates published each year in State Statutes NR46.30 reports a 10% per year increase in the price of red oak.  Timbergreen Forestry price trend information shows an increase of over 13% per year from observed timber sales on private land. 

This effect is due to the once vast supply of good trees being quickly depleted by an increasing world wide demand  for Wisconsin wood products.  "Its simple supply and demand," states Birkemeier.  "All of us working daily in the forests of this area see that the supply of good timber available for harvesting is dwindling, while the timber industry is growing steadily in all areas.  We regularly get inquiries from up to two hundred miles away from timber buyers wanting to purchase wood here. Competition is getting very intense, and that is driving the price of timber up.  Managers from two of the largest sawmills in the region recently told me they are no longer able to buy and harvest enough red oak logs to supply their orders."

"Even the prices for pulpwood, sawbolts, and low grade logs are skyrocketing.  Considering this price trend about the only mature tree in Wisconsin today is a dead tree, one that will not survive until the next harvest, or a tree that is hindering the growth of a more valuable crop tree."

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