Alternative Income Sources for

GA Forest Landowners

• David Dickens, Ph.D.

• Forest Productivity

Professor

• Warnell School of

Forestry & Natural

Resources

• The University of

Georgia

Alternative Income Options for

Forest Landowners in GA

• Pine straw – used as a mulch for landscaping on golf

courses, around homes and apartments, stores, etc. – in

many cases an annual income

• Hunt lease – renting land for hunting (deer, turkey, quail,

ducks, rabbits, etc) – in many cases an annual income

• Other sources as well (these come and go) – mushrooms,

bees/honey, naval stores, Carbon credits

GA Commodities values

2008-2012 (millions $)

Year Broilers Cotton Peanuts Eggs Timber Beef Horses

2008 4890 584 582 593 472 367 413

2009 4420 713 401 572 402 356 398

2010 4590 1170 470 580 480 407 362

2011 4670 1510 586 568 470 409 322

2012 4700 1300 891 793 523 538 507

3 major GA products exported out of the Savannah Port = wood, chicken, and clay products

GA timber values 1999 - 2012

Source:

Boatright and

McKissick 2000-

2013Timber revenue down 23% from 2000 through 2012

Economic Impact of Pine Straw in GA

2000-2012

$ paid to Forest Landowners

Source: UGA-CAES “GA Farm Gate Value

Report” Boatright and McKissick 2000-2013 A value increase of 380%

from 2000 through 2012

2012 Top Ten Counties by Value - TimberCounty Farm gate Value

Jenkins $18,447,195

Clinch $16,544,533

Telfair $15,000,000

Wayne $14,732,165

Charlton $14,278,372

Screven $13,322,713

Ware $10,566,229

Laurens $10,355,673

Emanuel $9,918,763

Brantley $8,986,971

2012 Top Ten Counties by Value - Pine Straw County Acres $/Acre Farm gate

Talbot 53,000 $90.00 $4,770,000

Jeff Davis 50,000 $90.00 $4,500,000

Wayne 45,000 $100.00 $4,500,000

Dodge 45,000 $90.00 $4,050,000

Wheeler 28,500 $90.00 $2,565,000

Bulloch 23,500 $90.00 $2,115,000

Ben Hill 23,000 $90.00 $2,070,000

Emanuel 21,000 $90.00 $1,890,000

Appling 20,000 $90.00 $1,800,000

Colquitt 15,200 $90.00 $1,368,000

2011 Top Ten Counties by Value Timber

County Farm gate Value Pickens $24,066,400

Clinch $18,618,286

Laurens $15,012,947

Charlton $10,938,617

Wayne $10,826,163

Emanuel $10,070,572

Long $9,849,610

Screven $9,605,025

Ware $8,196,840

Telfair $8,000,000

2011 Top Ten Counties by Value Pine Straw

• County Acres $/Acre Farm gate

• Wayne 45,000 $125.00 $5,625,000

• Laurens 55,000 $80.00 $4,400,000

• Talbot 53,000 $80.00 $4,240,000

• Jeff Davis 50,000 $80.00 $4,000,000

• Wheeler 28,500 $116.00 $3,306,000

• Dodge 40,000 $80.00 $3,200,000

• Calhoun 30,000 $80.00 $2,400,000

• Ben Hill 23,000 $80.00 $1,840,000

• Bulloch 22,000 $80.00 $1,760,000

• Emanuel 21,000 $80.00 $1,680,000

Pine Straw Production – raking into piles

Pine Straw Production – fluffing straw

Pine Straw Production – bales ready for market

Pine Straw Production – covered to

protect from rain

Pine Straw Opportunities

• MarketsContractors Available

Labor & Equipment

• Stand Conditions

Species, Stand age

Understory Competition

Selling Pine Straw: Per Bale• Difficult to anticipate

yield/earnings

• Paid for only those bales

removed - need accurate bale

counts

• Make sure that a “bale” is

defined in the contract; there is

currently no standard bale size

• High values on well-managed

stands

Selling Pine Straw: Per Acre

• Lump sum sale - $$ up front

• Straightforward sale; no guessing

or estimating bale counts

• Typically best way to sell for

absentee landowners

• 3 to 5 yr contracts are common

• Typical incomes of $60 to $125

/ac/yr

Pine straw raking period in Georgia• Typically from canopy closure

(age 6-10 yrs) to first thinning

(age15-23 yrs) or after a Federal

rental contract has expired

• In GA thinned stands are not

typically raked due to the large

acreage of unthinned stands

available for raking

• In SC and NC thinned longleaf

stands are often raked

Stand Level

Pine Straw Production

• Longleaf pine = 80 to 200 bales/ac

(up to 400 bales/ac in 1 case)

• Slash pine = 120 to 300 bales/ac

(up to 400 bales/ac in 2 cases)

• Loblolly pine = 150 to 400 bales/ac

(up to 520 bales/ac in 1 case)

Demand and per bale prices

(SE GA 2003 -2012)

• Longleaf = highest demand, $0.50 to $1.00/bale

• Slash = 2nd to longleaf, high demand, $0.40 to

$0.65/bale

• Loblolly = low to no demand, $0.20 to $0.35/bale

where raked

Pine Straw Production Rates

based on:• Species

• Basal area (stocking +

size), age

• Site productivity

• Raking intensity,

mechanical vs hand

baling, and

• % rakable stand

(understory vegetation,

debris)

Slash pine straw income on an old-

field site in SE GA (60 acres)Year Bales/acre (13x13x28”) Income/acre ($)

1999 94 61

2000 204 133

2001 172 112

2002 227 148

2003 223 145

2004 386 250

2005 148 96

2006 339 220

2007 241 157

2008 114 74

totals 2148 bales/ac $1396/ac

means 215 bales/ac/yr $139.60/ac/yr

24-yr. SLASH Financial Results.

Mean annual increment = 5.8 to 6.8 tons/A/Y

Med. Prices, PW, C-N-S, & ST & Site Prep. @ $250/Ac

Scenario#,

Fert.Thin @ yr. 15 Pine straw/ac % PW

MAI

(tons/ac/yr)Net $s

Internal Rate

of Return

1, No N N 60 5.77 $1437 6.96%

2, No Y N 46 5.55 1787 8.28

3, Yes N $50 48 6.28 2805 10.95

4, Yes N $100 48 6.28 3686 15.71

5, Yes Y N 40 6.16 2037 9.00

6, Yes Y$50

(age 8-14-yrs)38 6.16 2322 10.46

7, Yes Y$100

(age 8-14 yrs)38 6.16 2672 12.87

8, Yes Y$100 (yrs 8-14)

$50 (yrs 17-23)38 6.57 3177 13.80

Pine straw in forest management pays large dividends

Pine scenario

SEV $/ac using

average stumpage $

SEV $/ac using high

stumpage $

24-yr, one thin loblolly 262 834

33-yr loblolly 148 603

24-yr, one thin slash 84 542

33-yr slash 65 467

24-yr no thin loblolly 16 424

24-yr, no thin slash - 294

45-yr longleaf - 98

33-yr longleaf - -

15-yr loblolly 10 tons MAI - 272

15-yr loblolly, 8 tons MAI - 2

15-yr, 6 tons MAI - -

Table 22. Soil Expectation Values (SEVs) at 6% discount rate using average ($8.10, $19.80, $27.00/ton net) and high ($12.60, $33.30, $43.70/ton net)and the average establishment cost for the NO PINE STRAW scenarios

Pine scenario

SEV $/ac using

average stumpage $

SEV $/ac using high

stumpage $ (rank)

24-yr, no thin slash 627 984 (2)

24-yr, one thin loblolly 536 1108 (1)

24-yr, one thin slash 495 953 (3)

24-yr, no thin loblolly 479 887 (4)

45-yr longleaf 466 733 (8)

33-yr longleaf 438 673 (9)

33-yr slash 427 829 (6)

33-yr loblolly 390 844 (5)

15-yr loblolly 10 tons MAI 261 744 (7)

15-yr loblolly, 8 tons MAI 87 474 (10)

15-yr loblolly, 6 tons MAI - 203 (11)

Table 23. Soil Expectation Values (SEVs) at 6% discount rate using average ($8.10, $19.80, $27.00/ton net) and high ($12.60, $33.30, $43.70/ton net)and the average establishment cost with PINE STRAW INCOME scenarios

Hunting Leases • An arrangement (written legal contract) whereby the

landowner grants access to his/her property for hunting

for a certain period of time in exchange for a fee or

service

• Landowners can lease their property by the day, week, year or

multiple years – can have separate deer and turkey leases

increasing /ac/yr income (due to different seasons in GA)

• Hunting leases can solve trespass problems because you choose

who is hunting on your property – these hunters will tend to

keep others off your property

Hunting Leases • Typically an annual income scenario

•

• Markets - Distance to Atlanta, other large cities, or

Florida

• Habitat Quality– Duck habitat (water- rivers, creeks, beaver pond, rice

fields, marshes)

– Deer or Turkey habitat (woodland type, age, food plots,

access)

– Amenities: running water, electricity, RV hookups, cabin

Hunting Leases • Disadvantages:

– loss of privacy

– changes in farm operations to accommodate

hunters

– liability and safety concerns

– possible resentment from those that

previously hunted the property

Hunting Leases – keys to minimizing problems

• Selecting responsible hunters

• Securing proper insurance (leasees or leasors)

• Having a written lease (atty written) signed by all

parties

• Communicate regularly with hunters

Deer Hunting Leases – 2010 annual income

estimates in Georgia (2011 UGA Farm Gate

Survey)

average = $12/acre ($8.3 million total income)

Top 5 counties acreage Total value per year

Burke 350,000 $4.2 million

Washington 300,000 $3.6 million

Wayne 300,000 $3.6 million

Bulloch 285,000 $3.42 million

Echols 250,000 $3.0 million

Duck Hunting Leases – 2010 annual income

estimates in Georgia (2011 UGA Farm Gate

Survey)

average = $50/acre ($2.22 million total income)

Top 5 counties acreage Total value per year

Laurens 12,000 $600,000

Effingham 5,000 $250,000

Talbot 5,000 $250,000

Burke 2,500 $125,000

Colquitt 1,900 $95,000

Turkey Hunting Leases – 2010 annual income

estimates in Georgia (2011 UGA Farm Gate

Survey)

average = $2/acre ($7.1 million total income)

Top 5 counties acreage Total value per year

Echols 250,500 $501,000

Brooks 200,000 $400,000

Harris 200,000 $400,000

Stewart 200,000 $400,000

Putnam 150,000 $300,000

Economic impact of adding a hunt

lease to just growing wood products

With 7% land in food plots $5/ac/yr hunt lease

income+wood = wood only IRR = 10.5%

& $12/ac/yr IRR > 12.1%

Naval stores – a comeback ???

Old-field slash pine stand – collecting oleoresin and pine straw

U.S. gum naval stores species - slash and longleaf pine

> 6” dbh trees drilled at base, pvc pipe installed and bagged for gum collection

One SE GA producer noted that “A national company wants

25 million lbs of rosin and turpentine final product “

SE GA producers asked to make 500,000 lbs of rosin and turpentine/year

Producer “Opportunity to make $100 to $250/ac/yr

collecting gum from slash and longleaf stands”

• Labor and materials intensive

• Black turpentine beetle

problems

• Producers want gum delivered

in 50 gal drums ($0.50/lb

delivered price)

• Narrow tree work window

(2 to 5+ yrs)

• Some growth loss can occur

(4 to 6 %)

Information on the Web

• www.bugwood.org

• www.forestry.uga.edu

• www.forestproductivity.net

Questions

?