Maximizing the Value Yield of Short-Rotation Southern Pine Timber‪.‬

Abstract This study compared two product mix options for a southern pine dimension mill to maximize the value yield of plantation-grown southern pine timber that is harvested in short rotation (i.e., 30 years or less) and inherently yields sawlogs with a relatively small diameter and high proportion of juvenile wood. A case study showed that softwood sawmills such as the study mill could significantly increase their net revenue if tops and other small-sized logs with small-end diameters of up to 8 inches were sawn into squared timber products (e.g., 4 by 4 in.) instead of 1-inch boards and/or 2-inch-thick dimension lumber. This sawing technique of boxing the juvenile core to produce squared timber products minimizes the negative impact of juvenile wood on lumber yield in terms of volume and quality or grade. With such a change in lumber product mix, the study mill could increase its net revenue by as much as $3,942 per 8-hour workshift (or about $0.07 per cubic foot of log input), based on fourth quarter 2008 nominal prices. About 54.1 percent ($2,134), 2.6 percent ($101), and 43.3 percent ($1,707) of this could be attributed to product value yield improvement, volume productivity or throughput improvement, and log cost savings, respectively. There is an approximately 68 percent chance that such incremental increase in net revenue could be as high $5,346 per 8-hour workshift or as low as $3,095 per 8-hour workshift. It could increase (or decrease) linearly at an average rate of about $49.27 per unit percentage increase (or decrease) in mill productive capacity or $14.08 per thousand board foot increase (or decrease) in lumber output.