Part 1 of forest landowner basics: The value of timber cruises

Heraclitus, the Greek philosopher, is quoted as saying, “Change is the only constant in life.” Whether Heraclitus made that statement or not, the sentiment is as applicable to our forests and forest management as it is to all other areas of our lives. Sometimes in forestry, change is gradual, and we have time to adjust our silvicultural activities as needed to keep our forests healthy and our trees growing on schedule. Other times, change in our forests occurs suddenly, as we experienced firsthand with hurricanes Laura and Delta in 2020 and Hurricane Ida in 2021, and we must adapt quickly to realize the best possible outcome.

Whether the change is slow or sudden, big or small, our goal as knowledgeable forest landowners is to manage our forest land investments in an ever-changing environment. But how do we do that? How do we make educated, practical decisions that enable us to manage through change? Are there any tools or professionals that can help forest landowners prepare for change before the change occurs?

I have good news for forest landowners. There are basic tools we can use as well as valuable professionals with the information we need. Much of this information can be acquired well before the change occurs. In Part 1 of our Forest Landowner Basics series, we’ll cover the nuts and bolts of a timber cruise and explain the value of a recent timber cruise as it relates to change. Then in follow-up articles, we’ll review how and why we should use the information we gain from a cruise to establish a timber basis on our tracts, how professional foresters can assist us with our efforts and what we should consider when selecting a forester for the job and more.

Getting started with our first topic, a timber cruise is a statistical sample conducted by a forester that is designed to locate and estimate the quantity of timber on a specific land at a specific point in time. Cruises vary in intensity depending on many factors, such as the size of the tract, uniformity of the timber in the stand, amount of time or money allocated for the cruise, the amount and type of information desired from the results of the cruise. For example, during a timber cruise with 100% intensity, every tree on every acre of the property is measured, but during a 5% cruise, only trees growing on 5% of the property are measured and the results of the 5% sample are extrapolated to estimate the timber on the rest of the property.

Foresters can use fixed radius plots, variable radius plots or strips with a predefined width to sample the timber on a tract. During a cruise, foresters record different attributes of the individual trees growing in the designated sample areas. The important attributes of each tree that are usually recorded include the species, size (diameter at breast height [dbh] and height), the tree’s quality or grade and the tree’s expected product type or use. During a cruise, foresters can also gather useful information about the tract, including spatial data for creating maps of the property, and they may assess wildlife habitat conditions, survey for endangered species or other nontimber resources (e.g., medicinal plants), look for signs of illegal activities (e.g., timber theft) and record many other details the landowner may want to know about their stand.

If this all just sounds like forestry lingo, think of a timber cruise like a snapshot of your timber stand at one time in its life cycle. A cruise is kind of like a family photo. You get some useful information worth remembering, but if the same people are photographed in a few years, everyone will look different. That is why neither a cruise nor a family photo should be a one-time event. We usually take family photos at milestones like birthdays, weddings and anniversaries. We do that because we want to have a record to help us relive or remember the event and to provide others with a visual of the event we described.

Because a timber cruise is basically a snapshot of our stand, it is logical that we should get our timber cruised intensively at each important milestone for the stand. The first important milestone is within one year of acquiring the tract. This cruise should happen whether the forestland was purchased or inherited. This initial cruise is important because it gives you the information you need to develop a management plan for the stand, and it provides information you need to determine your timber basis for the tract.

The second important time for landowners to have their timber stands intensively cruised is within one year prior to any scheduled harvests. This timing allows a landowner to have an estimate of the anticipated timber volume by product class that will be harvested from the tract and an estimate of the monetary value of the timber that will be harvested from the tract. This information is equally important for all timber sales regardless of whether the timber will be sold in a lump-sum timber sale or in a pay-as-cut timber sale.

Other verification cruises should be considered in addition to these milestone cruises. These cruises can be lower intensity cruises and should be done to verify that management goals and projections are being reached. Often these types of cruises are done during or immediately after some type of harvest operation and are included as part of a forester’s duties of contract supervision and verification.

When the data collected from a cruise are calculated, the forester will present the landowner with the results of the cruise in a report designed to be both useful and easy to read. A quality cruise will provide the landowner with details, which include total volume for the tract, total timber value for the tract, average volume per acre, timber value per acre, spatial distribution, species distribution, diameter distribution, product classes and any other details requested by the landowner.

Information gained from a cruise provides the quantitative information needed for the forester and the landowner to develop a detailed forest management plan, which can help guide the landowner’s short-term and long-term management decisions. In addition, a well-written management plan provides continuity when the timber is passed to future generations. A forest management plan also demonstrates to the Internal Revenue Service that the forestland is managed actively as a business and not passively as a hobby.

As I previously mentioned, perhaps the most important milestone to conduct a cruise is within one year of the acquisition of the tract. For most landowners who acquire forestland through a purchase, this cruise is typically conducted as part of the purchase process, but that is not always the case. This initial cruise should be done whether a tract was purchased or inherited because the information from this cruise can be used to establish the timber basis for property acquired by purchase or to determine the stepped-up timber basis for property acquired by inheritance.

3/11/2022 9:15:01 PM
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