Economic Feasibility Analyses 3533 



Annual pallet lumber production is 13.3 million board feet, lumber scale 

 (1 , 107,500 cubic feet). Annual sales of sawlogs and veneer logs total 4.5 million 

 board feet Doyle log scale (1 ,427,500 cubic feet). Annual production of byprod- 

 ucts (green- weight basis) is comprised of 13,400 tons of flakes and shavings, 

 9,000 tons of pulp chips, and 14,450 tons of hog fuel (mostly sawdust and bark). 

 Other key statistics and the foregoing data are based on single-shift operation, 

 250 days per year: 



Capital investment (including $424,210 working capital) $3,249,510 



Operating cost, annual 2,275,500 



Sales, annual 3,304,500 



Net profit, annual (before income tax) 1 ,029,000 



Return on sales 31.1 percent 



Return on investment 31.7 percent 



Employees 10 



Energy requirement, annual 



Electrical 1,600,000 kWh 



Gasoline, oil, and gas 



Wood residues 



The projected materials balance for the operation is shown in figure 28-19 

 bottom. Log purchase price was estimated at $1 10/Mbf, Doyle log scale. Prod- 

 uct sales prices, fob mill, were estimated as follows: 



Product Sales price 



Veneer logs $175/Mbf Doyle log scale 



Sawlogs $150/Mbf Doyle log scale 



Pallet lumber $150/Mbf lumber scale 



Flakes $15/ton, green basis 



Pulpchips $13/ton, green basis 



Hogged fuel $ 8/ton, green basis 



28-18 $4.2 MILLION— MANUFACTURE OF DOWEL- 

 LAMINATED CROSSTIES, PALLET LUMBER, AND PULP 



CHIPS^o 



In this plant, planned for southern operation, weight-scaled hardwoods — 

 mostly tree length — are offloaded by crane and sorted into inventory. They are 

 then crane-transferred to a log cut-up deck to yield crosstie logs, random-length 

 sawlogs, veneer logs, 3- to 4-foot-long bolts for conversion to pallet cants, and 

 8 '/2-foot bolts for conversion to half ties. All but the random-length sawlogs and 

 veneer logs (which are resold) are drum-debarked and converted on two shap- 

 ing-lathes (one 4-foot, the other 9-foot) into the mentioned products plus pulp 

 chips (figs. 28-20 and 28-21). 



2^ Abstracted from Briede, R., and D. Hunter. 1981. Economic feasibility study for a pallet- 

 lumber and dowelled-tie manufacturing plant. Final Report FS-SO-3201-57, dated May 1 1 , 1982, 

 on file at the Southern Forest Experiment Station, U.S. Department of Agnculture, Forest Service, 

 Pineville, La. 



