Virginia Logging Business Economic Sustainability Survey Including Perspectives from Across the Forest-based Supply Chain

Logging businesses are an essential component of the forest-based supply chain. They are the connection between forest landowners, who grow the raw materials, and forest product mills that produce primary forest products. They are confronted with many operational challenges and issues that can make operating sustainably, producing a profit, and obtaining long-term economic viability seem unattainable. Although other businesses have similar operational challenges, logging businesses are somewhat unique in that they have minimal influence over delivered prices or the cost of stumpage, so changes in variable input costs can have large impacts on businesses' economic sustainability. Logging business operational challenges include increasing input costs such as equipment purchase costs, fuel costs, and equipment maintenance and repair costs. The economic sustainability of logging businesses affects the entire forest-based supply chain because one segment cannot function successfully without the others. This project evaluated operational characteristics, challenges, and issues related to the economic sustainability of logging businesses in Virginia from May through July 2023. A comparison was conducted using opinions and perspectives from professionals in other segments of the forest-based supply chain, on their outlook for the logging industry in Virginia concerning economic sustainability. Mail questionnaires, following the Dillman Method, were used to collect data from the survey populations which included logging business owners, consulting foresters (landowner representatives), and mill owners or procurement representatives. The response rates for logging businesses, mills, and consultant foresters were 27, 40, and 69 percent respectively. The top two challenges logging businesses faced in Virginia were fuel related. The number one challenge reported by logging businesses was fuel costs for in-woods harvesting equipment followed by fuel costs for trucks. Only 32.9% of logging businesses reported they were profitable in the past year. Only 26.1% of businesses had an outlook that their business was economically sustainable while 38.8% reported that their business was not sustainable. A greater percentage of mills (56.3%) and consultants (68.9%) reported their outlook for logging businesses was not economically sustainable. There were many neutral perspectives from all populations, however small positive changes in market conditions could move responses to the positive side of neutral. This study identifies the challenges in the industry as well as perspectives on the future of the forest industry's economic sustainability. The results of the study should be used as a catalyst encouraging segments of the industry to work together to address challenges and find solutions.