Pilot of the Saw Cab

February 9, 2012 10:42 AM

The following story was written by a University of Missouri student as part of the 2011 Sonja Hillgren/Farm Journal Ag Journalism Field Reporting Institute. Learn more.


By Ben Unglesbee
The tempo at the Spencer Lumber Co. sawmill, which sits a few miles south of Salem, Mo., is kept by an orchestra of machines deconstructing wood in different ways.
A log de-barker outside the mill shed keeps a rapid beat that sounds like an over-tightened snare drum. A chip blower out back hums a frustrated tune while the circle saw in the shed plays sharp, high-strung chords.
Under the roof of the shed, a heavy snow of sawdust covers the back of the saw cab. On the door to the cab, someone who knows its occupant well has written a joke in the sawdust with a finger: "Shorty inside."
And below that: "Half pint."
The man who runs the cab—and presumably the butt of the jokes—is Stephen Spencer. Spencer is the current owner of the family milling operation. He says he will probably be the last.
Spencer’s great-grandfather started the company more than 100 years ago, and four generations of Spencers have steered it through intermittent market downturns and economic calamities.
Stephen Spencer and the family sawmill represent a notable success story at a time when Missouri sawmills have declined significantly. He has kept the company afloat in a frigid economy largely through his business smarts and the relationships he has built over time.
As for the "shorty" jokes—Spencer doesn’t seem diminutive at all when moving about the mill to answer his employees when they shout over the equipment noise for his help. He goes with quiet and prompt purpose, then hurries back to the cab after resolving an issue.
The interior of the saw cab where Spencer spends much of his day resembles that of a small, ancient airplane. A series of pedals at his feet control the saw deck, and he maneuvers logs from the deck to the carriage using joysticks that sit at either hand. Once a log is on the carriage, a dashboard of buttons and switches allows him to choose the precise cut of each log.
Every time he sends a log down the deck Spencer must make an instant judgment about what product to cut. He makes this decision based on a visual assessment of the size and quality of each debarked log. Years of experience have taught him how to make these swift judgments.
With a wiggle of a joystick that controls a stumpy robotic arm, he heaves a log onto the carriage and begins to cut, lining it up with the laser sights on the saws.
"I’m gonna make a six-by-six and one quarter out of this one," he says as metal clips, or "dogs," clench onto an oak log and clamp it securely to the carriage. If something goes wrong or his judgment is off, he can adjust on the fly and cut a different size board.
A similar flexibility has enabled Spencer and his mill to weather downturns, recessions and a competitive lumber market.
"Everybody cuts three-by-fours," he said. "What I like to do is find things no one else wants to cut. That way, you can find a niche. Then I’m a commodity."
Spencer’s buyers often connect him with these niche markets. He counts eight brokers altogether that purchase separate products from him and sell them to their own buyers.
The relationships Spencer has built with his buyers are of critical importance to his business. He’s worked with one of his brokers since 1986.
"Once I get connected with a buyer, I stay with them," he said.
World Wide Wood. On a clean, sunny day, light-brown flurries fall on Spencer’s sawmill—a precipitation made of wood particles.
The sawdust clumps together on every surface it can find and gives the air around the mill a hot smell vaguely similar to heated glue. Blooms have sprouted on the ceiling of the mill shed that look like mushrooms or scaled up models of microscopic life.
Throughout the day, cushy mounds of woodchips build up between the saw carriage and the log deck. The next morning, the mounds will be swept up, processed and sold to a broker.
This wasn’t the case 30 years ago.
"Our saw dust piled up," Spencer said. Innovative uses for wood products since that time have reduced sawmill waste to almost nothing.
When Spencer’s great-grandfather owned the company 100 years ago, the mill and its operations looked even more different. Laborers would spend an entire day bringing lumber by wagon from Montauk, Mo., to the mill.
"You could probably haul more in the back of a pickup today than they could in that wagon pulled by a team of horses," Spencer said.
Now, Missouri trees coming to Spencer’s sawmill get stripped, sawed and chipped, and can end up anywhere from Texas to Oregon to Japan.
The geographical diversity of Spencer’s eventual customers reflects the diversity in the wood products he sells.
Every part of a tree gets turned into a product by the mill. Sawdust is used to make coal briquettes and bedding for horses. Bark gets stripped and ground up for mulch. Woodchips become paper pulp. Pallets cut from the exterior of logs are used to make industrial packaging for equipment and can be made into truck mats for vehicles traversing oil fields.
The varied and global nature of the modern lumber market has helped it endure the collapse of the housing industry and the ensuing recession.
"More and more mill owners are finding opportunities to sell products internationally," said Thomas Treiman, a natural resource economist with the Missouri Department of Conservation. Treiman suggested that international markets might help bring up the prices for lumber products, which dropped with the recent housing slump.
When the U.S. housing market bottomed out starting in 2008, it pulled the lumber and timber markets down with it. Jason Jensen, the forest products program supervisor with the conservation department, said that 2009 was the worst year for wood markets "maybe ever."
"If houses aren’t being built, then wood products aren’t being used," Jensen said.
Treiman said that Missouri lost about 20 sawmills between 2007 and 2010.
Spencer has survived the recent recession—which he said was "the fourth major downturn" he has seen in his life—in part because of the diversity of the market he sells to. Only about 20 percent of his lumber ends up in housing. Most of his products go toward industrial uses, though those buyers have been hit by the global recession as well.
In past downturns, the Spencer mill has had to cease operations altogether. In 1960, the company was hit so hard by a market downturn that the family moved to Colorado to find work.
Because of the turbulence in the industry, Spencer did not want his own children—who are now grown with families of their own—to get involved in company.
"The business has been good to my family, but anymore there’s so much investment that there’s not much return," he said. "There’s times when it’s just too difficult."
From the Forest to the Saw. Along with the relationships he’s cultivated with his brokers, Spencer also maintains a long-standing relationship with his timber supplier. Spencer buys his logs exclusively from a single logger he has worked with for more than 10 years.
The harvesting practices used by different loggers are common knowledge among sawmills, Spencer said. It could affect his standing in the market if Spencer were to employ a logger with a reputation for exploiting woodlands or landowners.
"It took my family four generations to build a reputation and I could destroy it in a year," he said.
Scott Brundage, a forester and former chair of the Missouri Forest Resources Advisory Council, thinks Stephen Spencer’s outlook is rare among Missouri sawmill owners.
"He’s one of the very, very good ones — one of the honest ones, I’d say," he said. "Don’t think that everybody’s like Spencer."
Brundage said many sawmills make their timber purchasing decisions by price, not the reputation of the loggers they buy from. Without state regulations for harvesting in Missouri or a licensing requirement for loggers, no legal measures are in place forcing loggers to use accepted forestry practices when cutting timber.
Private certification exists for loggers through the Missouri Forest Products Association. The organization conducts a training program for loggers called Professional Timber Harvester, which consists of five days of required training plus annual classes to maintain certification.
Tammy Homfeldt, the communications manager for the Missouri Forest Products Association, said some sawmills require the Professional Timber Harvester training, and loggers could lose business if they don’t meet the mill’s requirements.
But do sawmills "lose business because they don’t (require the training certification), or gain business because they do?" she said. "We don’t know that."
Nor can mills be certain what practices loggers use in the field even if they are certified through the training program. The association conducts a master logger program which uses regular audits, but Homfeldt said she did not know of any sawmills that require its timber suppliers to be certified as master loggers.
Treiman, the conservation department economist, said the link between sawmills and harvesting practices is probably "circular."
"We need to make sure there is a functioning wood products industry," he said. But trying to negotiate a middle ground between sustainable harvesting practices and a functioning wood products industry is a "fairly delicate balancing act."
Within his own business, Spencer has managed that balance in part by remaining small.
When he could expand his operation by adding equipment and employees, Spencer chose instead to stay lean and flexible, avoiding the large debt that comes with growth. Staying small also allows him to remain "discriminating" in his buyers and sellers, so that he can preserve the reputation and relationships that four generations of his family have cultivated.
Brundage attributes Spencer’s longevity in the lumber industry partly to this conscientiousness about his reputation and business practices.
"This guy’s going to be around forever," Brundage said of Spencer. "He’s looking at the big picture."
Spencer puts his own success in more modest terms:
"I try to cut good products, and I try to be friendly."

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