Milling for shares
Sawyers discuss the practicality and profitability of share-cutting. March 4, 2002
I recently bought a LT40HDG25. People are soliciting me for custom milling. I have been thinking about cutting for shares. I will be mostly doing softwoods, probably 80% fir. What is a common split for share cutting?
Two friends of mine both have Wood-Mizers. Both have cut for me. One is fast but not as precise and works for $185 per 1000 board feet. The slower guy works for $215 or more per 1000. His boards are superb.
You could look at share-cutting this way: Depending upon your cutting speed, plan to get paid in lumber an equivalent of the same rate that you would charge. That figure might be less or more than these two bandmillers. For example, if you cut 1500 ft. for a customer and felt that the green lumber was worth .40/bdft, about 700 to 800 ft. of that wood would be equivalent to the charges these two guys apply for their work.
Neither of these guys like to share-cut. They like greenbacks.
I have cut on shares. Softwoods, delivered to my yard, I do 50-50 in log form. I wouldn't do hardwood on shares because of grade. One of us would feel cheated. If I have to have the logs trucked here or even cut down, that all affects the rate and probably wouldn't do it.
I have also cut for shares, but I haven't found it that profitable. I do most of my sawing at my customers' locations. I have had the customer help with the offbearing of the lumber. We take the boards off the mill and split them into two stacks. This way the grade of lumber is as equal as possible. After the sawing is done I number each stack and number two pieces of paper. I let the owner draw a piece of paper and the number on it is his stack.
The problem was wasting a second day trucking the lumber home and stickering it. Even with red oak I didn't get enough good lumber to make it worthwhile. So if you are going to saw on shares, it would be best to have the lumber trucked to your location.
Cutting on shares generally doesn't pay for blades or fuel. It's a great way to acquire inexpensive lumber, though. We've cut 50-50 before but I won't take any now.
Shares are tricky. I have done it two ways.
1. Scale the logs and each get about equal size logs. Not such a problem with softwoods but with hardwoods grade comes into play as to the value of the lumber.
2. When sawing as the boards come off the mill, put them into two stacks. You get half of the good and bad. If I go to their place I get an extra charge of 100 bdft. If I have to fell the trees and skid the logs they only get 1/4 unless it is really a lot of work, then I will not do it.
Most of the time when they see how good the lumber is and how cheap it would be for them to just pay for it, they end up paying for it. If they are building a project, most of the time they do not have enough lumber in their pile and have to buy from mine at twice the sawing rate ($.20bdft). It is tricky, but make sure everything is understood before you saw.
I have two Mobile Dimension Mills and I have cut on shares, primarily softwoods and some hardwoods. Most of the sharing will occur when I find that I might be in short supply of that specific species of log or sawed lumber. My rate generally runs 50/50 and they must bring the logs to my site as I do not go out.
For years I've avoided cutting for shares, simply because I didn't have any place to store lumber, and I had plenty of people who would pay for custom sawing service. Now, I've moved to a different area, and I need to change my business plan. About every third call is a trade job, and so I've been taking them when I can afford to, but still not sure how to get rid of the lumber, especially of minor species.
When I do trade, I take half if the logs are in a deck and easy to get at and handle. If there are aggravating circumstances, I will often take a few extra boards, or some firewood, to help offset my costs. If I were to do the falling and so forth I would take 3/4 unless it was really bad, and then I take all. In the suburbs, this is often just fine with folks - they are glad to have the mess removed. It can be a good way to get a free log every now and then.
As to grade and which stack, I try to alternate each board coming off the mill into the stacks, and then, if I've gotten no help from the landowner, I choose which stack I want. If they've helped, they choose. I still don't know if this will make me any money, but it sure helps with my farm buildings.
I cut on shares whenever possible. I have a dry kiln so that helps considerably. Selling green lumber I don't think I would cut on shares, but with a kiln, it works well. Then a little different scenario comes into play. A neighbor has about 20 very nice red oaks. Smallest is 15" at chest, largest is about 30". I have to cut and haul them, but we are splitting the lumber (I get the firewood). He will clean up the tops, so I feel it is a pretty sweet deal. Another good thing is they are only about a mile away. Anyone think I'm silly?
Nope. I wish I had a dry kiln, too. I know that I could sell lumber if I could dry and plane it. It's considerably harder, though, to sell green hardwoods, at least in SW Washington state. Firewood is a nice kicker, and I often take firewood as "payment" for extra work or favors.
I could cut full time if I would cut on shares. I did cut on shares quite a bit the first year, but found that it didn't work to well for me. You have to have a market for the lumber and right now the price of Doug fir is way down. I have traded 50/50 lumber scale for lumber scale. The last Doug fir job I traded log scale for log scale. He took most of the small logs and got more overrun than I did but it will work out because I will cut the other logs into special order beams. I will cut western red cedar on shares. 50/50. Also black walnut. You need some money to operate your mill and pay for your blades. I charge a move-in fee especially if it is trade job. I charge $100 for anything within 50 miles.
I'll cut on shares, but I usually take mine in logs. It usually starts at 50/50 and goes from there depending on quality and species of logs. The risk is not knowing what's in each log you get, but so far has worked out for me, especially on good pine saw logs and cedar and cypress. Sawing on shares usually gets me logs for about 1/2 to 1/3 what I'd normally pay for them. Doesn't do your cash flow much good, though.
From what I have read concerning share-cutting, it seems that some millers would be ahead of the game with a kiln of their own, especially the ones who already have the supplemental machinery needed to handle lumber stacks:
1. Take some share cutting to get extra lumber.
2. Build an air drying shed and, one year later (or as soon as possible), a solar kiln.
3. As soon as possible, add a dehumidifier type kiln or a waste-fueled heated kiln.
4. Maximize the value of future share-cutting. Maximize the value of all your other cutting, while still having the sweet cash flow of for-hire cutting for paying customers.
Also build a heated shed to store your dry lumber in.
Eastern hardwoods go 50-50 if the owner helps by picking, etc. Otherwise, you pick a board, I pick two. I have stooped to unassisted 50-50 for cherry and walnut if it's clear and at least 24 inches of heartwood. All quartersawn.
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Comment from contributor A:
Some people who cut for shares set their mills up and cut the logs, if they are already cut and piled, for 50% of whatever the lumber brings out of the back of the mill (I mean after the sawyer sells the lumber to his wholesalers). If he has to cut them and pile them he will cut them for 60%. I know it doesn't sound like much, but he gets some really good logs this way.