Evaluating Markets for Small Diameter Timber: A Case Analysis in Northern Mississippi

Small diameter timber (SDT) has emerged as a national problem in the forest products industry due to catastrophic forest fires in the West, increases in imported pulp in the South and high grading in the Central and Eastern U.S. This research evaluated the potential markets for small diameter hardwood and softwood timber resources in Northern Mississippi. Traditionally, SDT has been used primarily as pulpwood in the production of pulp and paper products. However, demand for pulpwood has decreased due to the increase of imported pulp. Exports of paper products from Mississippi decreased 18% between 1999 and 2003, while exports of wood products increased 82% during the same time period¹. Stumpage prices of softwood pulpwood in the southern region have declined during this period from approximately $10/ton to $6.35/ton currently. Stumpage prices of hardwood pulpwood in the southern region have increased slightly to $5.43/ton². Due to the low prices of small diameter timber, value added products need to be explored so that SDT harvesting is economically feasible. The combination of weak pulpwood markets and the lack of alternative markets for SDT have led to an increased supply of SDT. In Northern Mississippi it is estimated that timber growth in non-industrial private forests exceeds removals by 750,000 cords per year³. Currently there are few value added markets that can utilize the SDT resource (< 9-11” DBH). The objectives of this research were: 1) to explore existing products that can utilize SDT, 2) identify markets in Northern Mississippi that can utilize SDT and 3) identify the viable markets for SDT.