Matching supply and demand in the timber industry, where there are significant lead times, is essential to ensure the best available returns. Suppliers face a difficult balancing act in getting the right timber to the right mills in time while ensuring their environmental impact doesn’t threaten their licenses or result in negative publicity.
Updating your inventory regularly can be cost prohibitive and current modelling techniques often means there’s a gap between what’s predicted and what grows. Growers often face the gamble of holding onto assets to produce higher value timber or cutting early for lower value pulp, paper or biomass.
Making the wrong decision can mean under-performance, lower profits and a loss of investor confidence.
Locating processing and production facilities in the wrong place can incur multi-million currency losses while failure to meet mill allocation obligations can result in the expensive purchase of wood on the open market or more costly penalty payments.