Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Stumpage Values topic
No spam. Unsubscribe anytime.
Montana advisory panel cites mill closures, weak markets as reason to review stumpage valuations
Summary
State revenue staff and industry representatives told the Forest Land Valuation Advisory Committee that recent mill closures and shrinking markets for ponderosa pine have depressed stumpage values, complicating the department's salvage-value calculations and prompting a recommendation to circulate updated zone maps and data before making valuation decisions.
At a Forest Land Valuation Advisory Committee meeting, state revenue staff and industry members said the March 2024 closure of Pyramid Mount Lumber and other market shifts have left few buyers for ponderosa pine and pushed stumpage prices back to levels seen in 2017–2018.
"Pyramid Mount Lumber announced their closure, and they processed the logs they had and basically auctioned off most of the equipment," Gordon Sanders, a committee member, said. "So Pyramid was a significant processor of ponderosa pine," he added, describing how residuals markets have tightened and hauling distances increased.
Paul McKenzie, who sits on the committee, said the market is "pretty soft" and that the industry is seeing "prices for our lumber products that are from 2017, 2018 values." He and other speakers said new mills or major upgrades could take years and that tax-policy adjustments based on current market data may be needed to reflect structural change.
Department staff described how stumpage and salvage values are calculated using rolling averages and available datasets. After a 2023 interim review, the department moved the salvage-value calculation in-house and adjusted the formula, staff said, because private-sale data are scant and available federal sale data are the most consistent statewide source.
"We really don't have a lot of influence as an industry in Montana for the value of our lumber," McKenzie said, adding that freight, mill capacity and rising costs squeeze margins even when theoretical values appear higher.
Committee members asked staff to circulate the latest Jackson reports and the state zone map so members can review species composition and market inputs before the department finalizes stumpage calculations. Staff committed to send those materials, schedule a short Zoom preview of preliminary zone boundaries before year-end, and provide a fuller set of analyses a few weeks before a May follow-up meeting.
The committee did not adopt new valuation rules at the meeting; members and staff framed the next steps as information-sharing and a short review so that any methodological changes would be informed by the most recent zone and market data.
