US Steel Story
US Steel and A Forester’s Sense Of Time
Timber quality differs markedly in government-controlled lands, cut-over lands, properly managed private lands, etc. These timber value differences are key to creating the Four Parks vision: they make land-swapping possible with the timber companies. This story attempts to show by example the higher timber prices which exist when forests are properly managed.
Back around1980 a client of mine wanted to buy about 4000 timbered acres from US Steel. But US Steel was selling around 30,000 acres and desired to sell in one sale, so we were in a competitive bidding position against others.
Most large acreage sales around that time were selling for about $100/acre. But, because of lake frontage and reasonably good timber, we thought maybe $200 or $250/acre was a fair purchase price.
Our offer was refused--US Steel accepted an offer from Mead for nearly $400/acre.
I was floored. I soon learned why.
You see, US Steel had a reputation for quality timber. They had employed at least three full-time foresters for 20 to 40 or more years. These professionals, working out of an office in Ishpeming, managed the resource correctly. Hardwood trees were properly spaced, tall and healthy, with crowns high in the air. These foresters marked all the trees to be cut, and they supervised their contracted-out jobs. As a result of decades of such careful forest management, US Steel had created a rare and valuable commodity. Little did I know.
I had experienced nearly uncut forests in other areas, and so knew their character.
I could visualize these uncut woods in my mind’s eye. And at the opposite end, a year or so earlier, I had seen cut-over stuff all the time, because this was the land I’d been selling up to that point, which at times was very frustrating, to say the least. I was somewhat trained on this cut-over junk, yet I hadn’t quite understood that--it was just hard to walk through...brush, tangles, saplings, stumps, a real mess. And yet, I was healthy as a bear. I was 31 years old, and could clamber over all of these unwanted left-overs.
I began to think more deeply, to compare the forests of US Steel to others, and now I was finally understanding value from the timberman’s point of view. I could indeed see that their forest trees were straight and tall, with not many knots or burls, or “leaners”. The realization hit me like a rock--I thought, what a difference in price. More than double when the trees are healthy – maybe even triple.
It makes you think about the time it takes to foster a healthy forest–essentially a forester’s working life. Old man time, indeed.