Arboriculture & Urban Forestry 39(1): January 2013 ing rate to mill ($/km), fs = fuel surcharge ($), Cr = marginal differ- ence between hauling for mill processing and landfill disposal ($). An additional interest of this study was to analyze the efficiency of the business model in comparison to a tra- ditional, procurement-driven and continuously operat- ing sawmill. RESULTS AND DISCUSSION Value of Avoided Disposal It was reported by the landowners in this study that very few of these urban logs would have been salvaged for firewood and instead landfilled as waste (D. Warmbold, pers. comm.). To the extent this was the case, the value of avoided disposal contributed significantly to the economic rationale of recovering urban logs. Due to common modes of log disposal in the study area (i.e., in fixed dumpsters) this value of avoided disposal was a function of both log volume and log weight. The quoted costs for disposal from different states and counties near job sites were surprisingly similar at the time of the study (P. LaMana, pers. comm.), and so for this analysis a standard disposal cost of $400 per 40 yard container (30.6 m3 ), rounded up to 40 yard units, and $125 per ton over seven tons, was used. Weight varied significantly depending on species (Table 2). Hardwood would have been more expensive to dispose of than conifers because of higher density, but the costs to mill both are equivalent at $0.18 per board foot to the client. Additionally, hardwood lumber is usually more valuable as both a primary and secondary product, although the marginal difference in value between hardwood versus softwood products decreases as the value-added via secondary processing increases (e.g., floor- ing, moldings, cabinetry). These considerations are compared with the cost of hauling to the mill, which is primarily a func- tion of distance multiplied by a fixed rate and a fuel surcharge. Mean avoided disposal cost per job site was $877 (95% con- fidence interval for mean = $236.85, range = $400 to $1800, n = 21 job sites). Alternatively, the mean cost to the customer of haul- ing these logs to the mill was $842 (95% confidence interval for mean = $147.92, range = $348 to $1502, n = 21 job sites). Thus, the mean marginal difference to the client was $35 (95% confi- dence interval for mean = $275.98, range = $-1102 to $988, n = 21 job sites). This does not include milling costs and subsequent production of secondary products charged to the client as fee-for- service. These results varied considerably by species (Table 2). In general, hardwood is denser and more expensive to dispose of than softwood, but yields wood products of higher value. However, the marginal difference in disposal fees between hardwoods and soft- woods is more than offset by the marginal retail value difference of rough-sawn lumber produced, which for softwood may be low. Recovery of lumber In this study, a total 313 logs, comprised of 12 species from 21 job sites, were taken to the study mill. Most of the recovered urban logs in this study were useable for the production of No. 1 and No. 2 common grade rough-sawn boards, and as reported, all lumber produced from study logs was comprised of these two grades (CitiLog, Inc.). Lumber recovery was surprisingly consis- tent among species and job sites. The total log volume (221.69 The analysis considered traditional saw- mill operation costs including labor and log procurement. m3) yielded 103.57 m3 of lumber (46.7%) and 118.12 m3 27 of waste; comprised of slabs, sawdust, rot, and metal contaminants. Among all logs and job sites, the normalized total 103.57 m3 (43,891 BF) of approximately 2.7 cm thick (4/4”) green lumber was produced, equating to an average LRF of 81.2% (95% con- fidence interval for mean = 3.72%, range 0% to 127%, n = 313 logs) (Table 2). Calculating the LRF as a percentage of the real- ized versus predicted lumber recovery describes the quality and condition of the wood. On average, approximately 81% of the predicted recoverable volume of study logs from scaling was cap- tured and converted to primary wood products. In this study, logs derived from harvested urban and suburban trees provided a large volume of No. 1 and No. 2 common grade rough-sawn lumber. Contaminants There were logs containing metal contaminants from 7 of 23 job sites (30%). The species of logs containing metal were pine Pinus spp., red oak (Quercus rubra), black oak (Q. velu- tina), and poplar (Liriodendron tulipifera). From these job sites, 41 of 313 study logs contained some metal contamina- tion (13%). However, one job site was a yard clean-out where all logs taken were self-selected by the owner as low grade. All of the logs (n = 18) from this single site contained metal con- taminants and all were red oak. When this single site was ex- cluded from the analysis, 23 logs (8%) of the new total (n = 295) contained metal. The study authors observed no particu- lar patterns correlating contamination with tree size or species. Value of Forest Products As described above, 103.57 m3 of green lumber were recovered from 313 logs derived from urban and suburban trees. Based on average local market values at the time of the study, and the observed quality of sawn lumber, researchers assumed published wholesale values for green rough-sawn lumber as indicated for No. 2 lumber for each species sawn (HMR, 2/16/2008). It was estimated that this rough-sawn green lumber equated to a total value of $18,061.78 at the time of the study. This valuation is con- servative because there was some No. 1 quality lumber produced. Assuming a wholesale value of $70 per cord (3.62 m3 ), it was estimated that culls, slabs, and cutoffs represented approximately $2,461.65 in salable firewood at the mill site. The study authors estimated that the 313 logs used in the saw- mill study would have been worth $4,440.78 if used only as firewood, processed at the originating job sites. In this study, it was found that log processing and transportation revenues were additive, resulting in salvaged logs yielding a total value of $20,523 at the mill location versus approximately $4,440 of value at the job sites (an increase of 462%) after accounting for the cost of transportation and the value of avoided disposal. Business Model A traditional business model in this case has two basic cost components: log procurement and operational. However, in this study, log procurement costs are not applicable because this business model does not procure logs from owners. This case study examined a fee-for-service model wherein the milling entity owns neither the logs (procurement costs are irrelevant) nor the resulting products. Categories of operational costs are fewer. ©2013 International Society of Arboriculture
January 2013
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