An index for logging cost changes across the US South

Abstract

A timely, accurate indicator of changes in logging costs would establish a baseline against which logging contractors could compare their own costs and would offer buyers and sellers of timber a reference for shifts in cut and haul rates. Using data from face-to-face interviews, we developed percent breakdowns of the key factors driving logging costs and proposed a logging cost index for the US South. Publicly available data on costs of diesel fuel, equipment, maintenance, labor, interest, and other factors were used to drive the changes in the cost index over time. Labor (32.8%), fuel (22.8%), and depreciation (19.3%) represented the greatest proportion of costs among respondents. The calculated cost index was found to match historical trends in logging costs. The gap between prices paid for logging services (logging rates) and logging costs shrank between 2006 and 2013, indicating a reduction in the potential profit in the logging industry. © 2014 Society of American Foresters.