Lessons in how to make a small-scale forestry project financially viable

While it’s great to have a passion and vision for transforming the spruce plantation in Comar Wood, progress is going to be very slow unless I can make it work financially. Through experiences over the last few years, I am realising the difficulties of making low-impact forestry in a small spruce woodland pay; but also building up a better understanding of how my work could become more financially viable. In the long-term management of the woodland I want and need to be able to pay other chainsaw operators to work with me and also be able to pay myself for my time cutting and extracting timber, to make this a sustainable rural enterprise that can provide a degree of local employment.

The normal mantra for making small woodlands financially viable is to add value to the timber produced (e.g. through processing into firewood, sawn timber, charcoal, etc.). Most of the timber coming out of Comar Wood is Sitka spruce but this species doesn’t easily lend itself to adding value. For example, softwood firewood produces less heat per log than hardwood and sells for a lower price (despite processing taking the same time as hardwood). At the scale of my firewood operation, the margins in spruce don’t make it worthwhile, so I focus on birch for seasoned firewood sales and we burn spruce ourselves. So far, income from the woodland has been sales of Sitka spruce roundwood at roadside, and a fairly small volume of seasoned hardwood firewood.

Currently I sell most of the spruce by the lorry load as 3m lengths of roundwood at roadside. Some has gone to Balcas for woodchip and some to commercial firewood operations. There are also some bigger diameter, higher quality logs cut to 3.7m that will be sold as sawlogs (i.e. to a sawmill) and should command a higher price. I found that the sale of timber from the thinning work in 2022/23 covered the costs of paying other cutters that I used to help, but left very little to cover my own time felling and extracting the timber (and I also had significant volunteer input for this operation). However, over the last two winters my felling operations have been more profitable. Areas felled included the new track line, a 1/4 ha coupe and 40 trees by the entrance. These areas contained larger trees with bigger diameter logs and felling was in contiguous areas so easier and faster than thinning. However, I did encounter some problems that reduced the income from the timber.

Firstly, the sale of timber into these markets is by weight rather than by volume (timber is weighed on the lorry). Due to my setup (i.e. doing the work myself, working part-time), felling operations took all winter and extraction was not completed until mid-summer. By the time the timber was sold it had dried out considerably and had lost weight, so was worth less (despite it being sold into the woodfuel/ biomass market where dry wood is an advantage!). I also found when selling the sawlogs that prices fluctuate and are dictated by supply and demand. Timing of the sale is important to get a good price, or a sale at all, especially when selling small quantities of Sitka spruce. I found that smaller sawmills generally only wanted larch or Douglas fir, not spruce, while the larger companies who do want spruce were not interested in the small quantity I had to offer. This was probably partly because at the time I was trying to sell the sawlogs there was a high level of supply in the market.

Finding my way around the rather opaque world of selling timber has been tricky. Having a good network of contacts and understanding the markets seems essential for getting reliable sales. This is something I will need to build up over time. Earlier in the year I was introduced to a new website called CloudForest Marketplace (https://cloudforest.market/), which aims to link sellers and buyers of small parcels of timber. Its developers identified that small woodland owners and small-scale users of timber (e.g. small sawmills) often find it hard to sell/source timber. Hopefully with time, as more users register on the platform, this will be a great resource for finding buyers for my sawlogs and other products.

I have realised that, if selling timber by the lorry load, I need to plan felling to ensure timber can be extracted and sold before it dries out too much. This might mean using other cutters to get felling and extraction done more quickly and also being able to do my own forwarding (so far I have been using a local contractor to forward my timber from the wood down to the road). If I can fell and extract to a particular time window it might mean I could find a buyer for the timber before felling and cut to their specification.

However, prices for small spruce roundwood on the mainstream market are always likely to be fairly low. Given the demand for firewood in our area, being able to sell locally would seem to be an ideal solution. This would reduce timber haulage on the roads and use the timber produced in Comar Wood to meet local demand. Selling lengths of spruce locally for firewood could be done by volume rather than weight and in this case having partially dried wood is an advantage. Ideally for this I would require a tractor/ timber trailer setup that I could drive on the road to deliver the wood to customers. A second idea is to sell trailer loads of spruce rounds, cut to the customer’s specified length, for them to split and season.

Now that I have access to more of the woodland via the new track, I wanted to be able to thin some more areas but, given my previous experiences with thinning, needed to find a way to help cover the cost of this. I hoped that I might be able to apply for a forestry grant to support my project. However, I found that I am not eligible for the Scottish Forestry thinning grant and, anyway, the amount they pay would not cover the cost. In fact, I have not been able to identify any forestry grants relevant to my project that I am eligible for that would pay enough money to be worth applying for. Grants seem to come with many stipulations and do not provide much financial support to small-scale woodland operations.

Instead, I applied to The Pebble Trust (https://www.thepebbletrust.org/), a charitable trust, for a grant to support my sustainable woodland management activities and was very excited to be awarded this money in the summer. This will enable me to thin a further 2 ha of the woodland over the next two years. As part of this I will provide employment to a novice chainsaw operator for 20 days, working alongside me, allowing them to gain experience. The funding also covers the organisation of a free workshop for 10 people on the use of hand tools for tree felling and a series of volunteer sessions to involve and educate local people in woodland management. I am so grateful for the grant, which will allow me to continue with my management plan for the wood while I consider future operations and how to build up a sustainable rural enterprise.

In the future, accessible areas of thinned spruce should eventually yield good numbers of sawlogs, so with careful planning and execution, final felling of these areas could produce a decent income. However, when I come to fell less accessible areas of the wood, the awkward extraction may make the work less financially viable without grant support. This is something to start considering. While I hope that future changes to the forestry grant system make it more amenable to my management objectives, I remain sceptical. I therefore need to think imaginatively about ways of funding my management into the future. Finding ways of maximising the profits made from timber sales is important, as are ideas for adding value to the timber through some form of primary processing, to help boost income. However, attracting some form of outside funding will be necessary if I am to achieve all of my management objectives, unless there is a serious and long term increase in timber prices!