Good Neighbor Authority program a ‘mixed bag’ for northern Wisconsin
Increased harvests and sales has led to price drops in areas of state, some report
MIDDLETON -- The Good Neighbor Authority (GNA) program, authorized as part of the 2014 Farm Bill, has boosted timber sales in the Northwoods’ Chequamegon-Nicolet National Forest from nearly 16 to 24 percent during the past three years, kept loggers and mills busy while improving forest health and wildlife habitat, proponents say.
But it also may have helped depress prices, according to at least two critics, one a consulting forester and the other the Ashland County forest administrator. Others say the effect of the GNA on prices is negligible. And both critics agree that there are other contributing factors in the national and international timber markets besides increased timber supply from northern Wisconsin that can keep prices down.
Matt Schultz, who lives near Park Falls and runs Pine Curve Consulting Forestry, said he supports the GNA as a land management tool, primarily because it has lowered the fire danger and made living in the woods safer for him and his neighbors.
“I live on property on the boundary of the Chequamegon-Nicolet National Forest on the Chequamegon side that is heavily pine and aspen, which makes it bad fire country,” he said. “Just to the west of me is hardwood and heavier soils, which is less fire prone.”
Schultz said habitat for grouse and other animals has also improved, thanks to the GNA efforts.
“Up until recently, there has been a lag in doing the work to provide those habitat features,” he said. “Park Falls is known for being the rough grouse capital of the state. One of our major tourism bases in the fall is hunting grouse. You see license plates from a dozen states when the grouse cycle is good.”
On the downside, he said he believes increased supply has contributed to lower prices.
“It’s simple economics,” he said. “There is only so much demand from the wood products and the paper products industry. If you increase supply and the demand stays the same, chances are that prices are going to drop.”
Figures (below) provided by the Chequamegon-Nicolet National Forest since 2016 show timber volume sold through the GNA agreement with the Wisconsin DNR by fiscal year since 2016, which runs from Oct. 1 to Sept. 30, followed by regular timber sales, followed by actual timber harvests. Timber purchases typically have two or three years of complete harvests after concluding a sale:
GNA Sold/Value: 17.75 MMBF / $1.77 million
Timber Sold/Value: 114.8 MMBF / $9.77 million (includes GNA sales)
Timber Harvested/Value: 99.3 MMBF / $8.1 million (includes GNA volume)
GNA Sold/Value: 25.31 MMBF / $2.65 million
Timber Sold/Value: 120.5 MMBF / $10.38 million (includes GNA sales)
Timber Harvested/Value: 93.1 MMBF / $7.68 million (includes GNA volume)
GNA Sold/Value: 30.7 MMBF / $2.8 million
Timber Sold/Value: 128.7 MMBF / $10.27 million (includes GNA sales)
Timber Harvested/Value: 90.8 MMBF / $7.59 million (includes GNA volume)
2019 (projected sales)
25 MMBF GNA and 102 MMBF regular sales.
“Our markets aren’t what they were several years ago,” said Schultz. “I’m not going to blame all that on GNA, but I know from my own experience that selling private timber has only gotten harder in the past three or four years.”
“In 2015-16, there was a bit of an uptick in market prices,” which have since declined, he said.
“But if we are to compare apples to apples with the best summer ground (prices) then to the best summer ground (prices) now, on the very best sales I could expect $45 to $50 for mixed hardwood pulp. If I had to re-sell those same sales now, I’d probably get no more than $35 a cord.”
Chris Hoffman, the Ashland County Forest Administrator, said his county has 177,732 acres of U.S. Forest Service lands. He said he believes increased sales volume there depressed stumpage prices for timber from county lands.
Ashland County figures:
2015 - sold 6,908 cords of hardwood pulp at $48.94 per cord / Total Revenue $703,011
2016 - sold 10,310 cords of hardwood pulp at $39.20 per cord / Total Revenue $618,858
2017 - sold 12,865 cords of hardwood pulp at $29.09 a cord / Total Revenue $664,527
2018 - figures not available until April
“Now not all of this decline can be completely Attributed to GNA sales, but the volume of wood available definitely went up during that time frame and the county’s revenue has suffered,” he said.
Hilary Markin, a spokeswoman for the Chequamegon-Nicolet National Forest, did not dispute that timber prices have declined in recent years, but said the cause is complicated.
She also noted in an email that the GNA program and increased timber sales and harvests from the Chequamegon-Nicolet National Forest have been “greatly supported by our partners and stakeholders (because it) “provides more wood to Wisconsin’s important forest products industry.”
Brian E. Clark is a contributor to Forest Business Network. He formerly was a business writer for the San Diego Union-Tribune and also wrote for newspapers in Washington State. He's also a regular contributor to the Milwaukee Journal-Sentinel and the Los Angeles Times.