ADDING VALUE TO COMMODITY LUMBER THROUGH MARKET TIMING CONTROLS

Advanced sawmilling equipment is capable of sawing for maximum profits through real-time value optimization. The key to success is to maintain the correct set of product values in process control tables to maximize profit. Recent studies in the British Columbia sawmilling industry indicate that in actual practice these value tables are updated infrequently. The rationale for improving profits by more frequent tuning of process control value tables is investigated by examining commodity lumber price trends over the period January 1991 to September 1992. In all cases examined, no evidence was found to suggest that relative price relationships hold for long periods of time. Specific market opportunities for improved profits by frequent maintenance of process control value tables related to market price shifts are demonstrated and discussed.