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New mill markets small logs.

A small sawmill in Saxman takes a new track for profits in the tricky timber trade.

Saxman Wood Product's J.C. Chappell thinks chipping southeast Alaska spruce and hemlock under 36 inches is unnecessarily wasteful. Not that he is criticizing anyone for doing it. The practice is simply the natural result of the market for southeast Alaska timber. After all, big logs are more valuable, and logging in Southeast is expensive.

Many trees cut in southeast Alaska are being shipped Outside as round logs, and it simply is not economical to ship little trees. Furthermore, most sawmills in the region are set up to cut big logs, again because that's where most of the market is. But smaller trees must come down with the big ones when a timber sale is logged; so they get chipped and used for pulp.

Chappell has a plan to change all that, and he has put action behind his theory. In May of this year, he began construction on a small-log mill on a three-acre lot he leased from Cape Fox Corp. at Saxman. The mill, which Chappell has dubbed Saxman Wood Products, is capable of sawing into lumber logs as small as 4 inches.

Other than its role as landlord, Cape Fox has no connection with Saxman Wood Products. "We have no plans to sell timber to him," says Cape Fox's Ernesta Ballard. Cape Fox, like other Southeast Native corporations, has title to 23,000 acres of timberland. They sell logs primarily for export and, while the company is reluctant to discuss its timber operations, Ballard says that timber sales currently comprise about half of the corporation's business.

Million-dollar Machines

Chappell indicates that, initially, he expects to get most of his logs from U.S. Forest Service sales in the Tongass. Federal guidelines stipulate that 50 percent of Tongass timber must be processed by mills operated by small businesses. Saxman Wood Products qualifies, and Chappell expects Tongass timber will keep him busy most of the time. He allows that he may buy some private sales "if we have a problem keeping the mill wooded. But I don't anticipate that in the near future."

The project is no small undertaking. By the time he is fully operational, Chappell will have invested more than a million dollars in the mill. His equipment consists of seven machine centers, including a brand new Fas-Track band saw head rig and a line bar re-saw. An edger, a chipping saw, a chipper, a double-end trimmer, and a debarker make up the remainder of the machine centers. Chappell plans to add a wood planer next spring so the mill will be able to produce finished lumber for the southeast Alaska market.

Concerning his choice of the Fas-Track saw for the centerpiece of his operation, Chappell says, "The mills in the Southeast part of the country have had to fully utilize smaller logs for a long time. They've gotten pretty clever at it. Their technology should work just fine for us up here." He points out that the Fas-Track was developed to cut hardwood and cuts a kerf of only 3/32 inches compared with the standard 1/2-inch kerf cut by most softwood saws in Alaska.

One big challenge facing Saxman Wood Products is a lack of space. The location at Saxman is valuable because of the barge access it provides, but three acres is simply not much room. Chappell figures he has room for about 2 million feet of log storage in cold and hot decks, but virtually no room for his finished product. As a result, he says, he has to be able to ship his product as fast as he produces it.

That means some aggressive selling on Chappell's part because he expects the mill to produce a half million board feet a month. He employed a dozen people during the construction phase and expects to keep 15 to 20 year-round employees busy. Adding the planer next spring will likely increase that number.

Asked whether he planned to draw employees from the recently- idled pulp mill at Sitka, Chappell replies that he has received several applications from former Sitka workers. "But," he adds, "this mill is considerably different from other mills in Southeast. I expect to do a lot of training." Chappell, who has spent a dozen years in the sawmill business including two years running a mill in Kasaan and a year and a half in Metlakatla, could no doubt impart some valuable learning -- even to experienced sawmill workers.
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Title Annotation:Saxman sawmill, AK
Author:Phelps, Jack E.
Publication:Alaska Business Monthly
Article Type:Company Profile
Date:Oct 1, 1993
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