Timberland owners use two basic timber sale models for selling forest products, with timber sold either as stumpage or as delivered products. Currently, IDL sells endowment timber using the stumpage model, with standing timber sold at public auction and purchasers being responsible for harvesting and removing the trees at their expense.
Under the Delivered Product Sales Pilot Program, IDL will sell at public auction specific product sorts like pulp, posts and poles, sawlogs, cedar poles, or house logs directly to end-users, contracting with loggers to harvest and deliver the product sorts. With delivered product sales, IDL will be paid for the value through the auction process and IDL will pay the contractor to harvest the timber through a separate contract.
The Delivered Product Sales Pilot Program will be evaluated by comparing prices realized for the delivered product sorts with the sales prices achieved for stumpage sales that have the same proportion of tree species, located in roughly the same area. This approach will help IDL determine if selling delivered products is in the best financial interest of the beneficiaries.
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Qualify to Bid
Under this Delivered Product Sales Pilot Program, IDL will contract directly with loggers for harvesting and delivering product sorts to purchasers. To be eligible to bid on harvesting and delivering products under this pilot program, timber harvesting contractors must apply to become eligible bidders. The bidder eligibility application period runs from July 1, 2022, through August 1, 2022. Following the application period, qualified applicants will be invited to submit bids on specific delivered product projects as they occur.
Complete the project bidder eligibility application below or download and print the application
Advantages of selling timber as a delivered product
The delivered products model empowers IDL to strategically market sales and specific products to improve net returns and adjust sorts as markets change to capture higher values. In other words, it helps the agency meet its constitutional mandate to maximize long-term returns for the beneficiaries.
Other benefits of this sales model include:
- Smaller or niche purchasers can be more competitive for specific products (house logs, poles, etc.) by buying only the product sorts they want, potentially resulting in more bidders and higher prices.
- The bonding requirements are less onerous for both the logging contractors and the purchasers of individual product sorts.
- The completion of a timber sale is more certain, harvesting occurs over a shorter time period (6-12 months) to align with agreed-upon prices for delivered products, and follow-up treatments like replanting can happen more quickly.
- The model can make “marginal” commercial timber sales more economical.
- Availability of individual products from within a larger timber sale may increase prices paid by purchasers interested in only certain species or products.
- IDL controls harvesting and hauling costs subject to contractor availability and rates.
- Costs may be accounted for more accurately.
Additional information about delivered product sales
Washington and Montana both use stumpage sales and delivered product sales to sell state-owned timber. Industrial landowners and most consultant foresters working with larger private landowners also use the delivered product sale approach because it provides increased revenue and better control of timing and results for their clients. Washington and the companies that sell timber as delivered products report net revenue increases of 10% to 20% compared to the traditional stumpage sale method.
Small private landowners that sell timber on their own typically use the stumpage model because they do not have enough volume or resources to conduct delivered product sales. Selling delivered products is more feasible for large industrial landowners, like IDL, who own and manage many thousands of acres of timberland.
The Idaho Legislature and Governor approved IDL’s FY2021 budget request for $500,000 to implement a Delivered Product Sales Pilot Program. Subsequently, in March of 2022, IDAPA 20.02.14 was updated to authorize IDL to sell endowment timber as delivered product.