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Tough Choice During Harsh Economy Leads to Success for PA Logger, Joey Kocjancic
Joey Kocjancic’s recent move into mechanization has proven to be a successful venture despite the downturn in the economy. Joey and cousin, Mike Kocjancic, have found a formidiable combination between Joey’s cut-to-length operation and Mike’s chipping operation. In the last year, production has hit an all-time high.
By Maya L. Brewer
Date Posted: 5/1/2010
Elk County, PA–Simultaneously purchasing three formidable pieces of equipment during the worst time in the history of the logging industry may seem downright crazy for most, but Joey Kocjancic, owner and operator of Cutting Edge Resources, has met with success.
Just over a year ago, Joey agonized over his potential move to mechanization. It was one of the hardest decisions that he has ever had to make. In fact, according to Joey, he lost much sleep over the three- to four-month period of decision making. He wasn’t sure if the “numbers would work” and he already knew that the economy wasn’t on his side. But once the decision was made, he hasn’t looked back.
Joey’s investment involved the purchase of three major pieces of equipment: the TimberPro TL 725B, the Log Max 7000XT head, and the Rottne SMV Rapid 16-ton forwarder. He’s been a cut-to-length operator for one year now and he’s already reaped the fruit of his decision.
Freely admitting that he’s a “small time guy”, Joey stated that he wouldn’t have been able to move into mechanization without the support and encouragement of his family and, in particular, his cousin, Mike Kocjancic.
“There were a number of things that contributed to changing up my business, but I’d have to say that my primary reason occurred when Mike asked if I’d go in to help him with his chipping operation. He needed more pulpwood for his chipper,” Joey stated. “I guess you could say that put the bug in my ear.”
And the more Joey pondered the idea the more he saw this move towards modernization as another “stepping stone” or challenge for him to grow in the industry. According to Joey, it seemed like a good thing to do because cut-to-length operations are not dependant upon the weather; there’s more potential for an increased consistent production; and the safety of an enclosed cab was important to him.
Joey’s been in the business since he was old enough to work, doing “odds and ends jobs” with his father, John Sr., cutting and skidding logs, driving his dad’s international tri-axel log truck. He attended Penn State University and obtained a two-year degree in Forestry Technology. Upon returning home, he continued working in John Sr.’s logging operation, but eventually he purchased his dad’s truck and began doing work for himself in the woods. He promptly hired one man to drive his truck. But then after three years of saw logs and skidding, he’s added cut-to-length mechanization.
Though Joey’s only four years into his own business, he has been doing logging all his life. He is a third generation logger. He is the second logger of the six within his generation of the Kocjancic family to move into mechanization. He and his cousin, Mike, have broken the family tradition and have become a “winning combination.”
“We come from a very reputable family name,” stated Mike. “We have big shoes to fill and we all try hard everyday. It is difficult to keep up the legacy that my late father, Edward, my uncle, John Sr., my late uncle Joe, and uncle Rudy have left behind.”
Joey’s company, Cutting Edge Resources, has a total of seven employees. He has two crews of two men each. One crew operates by hand, while he and another man comprise the cut-to-length crew. One other man drives his log truck and Joey’s wife, Patty, does the books and all the paperwork “that he doesn’t want to do.”
Joey works mainly in Elk and McKean counties for two land owners: Land Vest and New Shawmut Timber Company. He also works as a subcontractor for Mike and together they bid various sales. Joey’s hand crew operation provides saw logs for an area sawmill, Highland Forest Resources. Joey said that Land Vest, New Shawmut Timber, and Highland Forest Resources have been very good to work with. Joey provides tree tops and pulpwood to two particle board plants, Temple-Inland Inc. and Clarion Inc., and a paper mill, Domtar Corporation. According to Joey, these three customers are the major consumers of pulpwood and chips for most of the loggers in the area. They consume an exorbitant amount of pulpwood throughout the PA counties.
Joey’s cut-to-length operation is done primarily for Mike’s company, New Growth Resources, Inc. in Kane, PA, which is surrounded by the Alleghany Forest. Mike also supplies hardwood and softwood chips to the same three customers listed above as well as a few others. His chips are used not only for paper, and particle board, but also for laminate flooring and as a heating source for two area hospitals and the Kane area school district, which is heating its school and agricultural building with wood chips. It is the first school to do that. This heat source is saving the school district an estimated $50,000 a year in natural gas cost.
Mike’s company, New Growth Resources, is located on a 90-acre former International Paper facility. He primarily uses hardwood and softwood pulpwood for his chipping business. Mike’s been in the forest industry for 25 years, with his chipping business being his most recent change within the last 11 years.
Ten years ago Mike had been hauling pulpwood to four different markets and, within the last year before entering into chipping, his markets were reduced to a single market. He originally was hauling in excess of 150 loads per week and saw it drop to five loads per week. He had 12 trucks at the time and his business needed an overhaul. He investigated the chipping industry and purchased the first of his collection of Morbark Chiparvesters. He also owns two Peterson Delimber/Debarkers, which he also uses with Joey’s cut-to-length business.
When Mike first began chipping, he was supplying less than 20,000 tons to the three major markets (Temple-Inland, Clarion and Domtar) in PA; but now, with Joey’s help and his experience, that number has grown considerably. These three solid markets have lead to the stability of his company. Mike states that these three markets combined consume an overage of approximately 1300 tractor trailer loads of hardwood chips per month. With the advantage of three markets situated between 12 miles and 50 miles apart, New Growth Resources has led to the stability and success of New Growth Resources. Mike also contributes a dramatic increase in production and quality as a result of working with Cutting Edge Resources in 2009.
According to both Joey and Mike, they have worked out a system where each owns their own businesses, but they work “tightly” together on every job. Joey works as a subcontractor to Mike. Joey uses his TimberPro with LogMax head to cut the four-inch to 23-inch diameter logs. Joey enjoys the leveling capacity of his TimberPro and has found that his Log Max head has met and exceeded his expectations in terms of its production and reliability. The logs are then separated by a pre-haul operator into two piles (pulpwood and saw logs) according to what’s needed for the job. Joey uses his Rottne forwarder to pick up the wood which he hauls to the landing. According to Joey, the distance to the landing varies from very close up to three-fourths of a mile away. The landing is also one-third the size of typical landings. When 600 to 700 tons (about 35 truck loads) accumulates on the landing one of Mike’s Morbark Chiparvesters is on the premises to begin chipping. The chips are blown into the chip van and hauled directly to the buyers.
Without the assistance of cut-to-length operations, Mike would not be able to produce the sheer volume of chips that he currently produces. Many large PA land owners are mandating environmental protection of the forest floor by requiring loggers to leave behind four-inch tops as a buffer to prevent erosion. This aids in fowarders and harvesters leaving behind a minimal impact. Joey explained that most chipping jobs involve the whole tree, tops, limbs and all, but the requirement to leave the tops can slow down the work if you do not have cut-to-length mechanization. This is why Mike views Joey’s part as vital to what he does.
“I had a difficult time meeting the harvest requirements (leaving the merchantable tops in the woods) on timber sales offered by private land owners, forest consultants, the New York Dept. of conservation, and the U.S. Forest Service,” Mike said. “I kept passing on jobs, because I couldn’t meet their harvest specifications. Now Joey is able to meet that requirement for me, and he does an impeccable and highly professional job. ”
According to Mike, Joey is overseeing most of the timber sales on-site, including stem cutting, delimbing, debarking, cut measuring, leaving the four-inch top, and forwarding to the landing. Mike explained that his chipping jobs have become “easier to manage because the job’s already been cut and processed prior to the chipping process commencing.” Joey’s efforts have increased the overall chip quality, profile, and bark content. Mike stated that one of his biggest fixed costs, flail chain, has been reduced dramatically due to cut-to-length logging. Damage to residual stands is kept to a minimum due to having a pre-hauler in the forest rather than grapple skidders.
According to Joey, cut-to-length operations are not popular in the PA area. Most logging is still done by hand because of the hilly terrain. The trees are dropped by chainsaw, and then grapple or cable skidders move the trees to a landing where a tri-axel truck hauls the pulpwood to a chip mill. After chipping, the product is taken on to area customers.
Joey has never looked back on the tough decision that he made over a year ago. He has been well satisfied with the product and support he’s received from TimberPro, Log Max, Blondine, and his friends at L.C. Whitford Equipment Company.
“I can’t say enough about how happy I’ve been with each piece of equipment,” Joey stated. “I’ve found in my TimberPro that if you’re on a slope the cab can level itself. I’ve not been on a lot of steep slopes yet, but on the books the cab can tilt 28 degrees to the front.”
After flying to the TimberPro factory and meeting Pat Crawford, TimberPro’s owner and president, Joey purchased his Timber Pro model from L.C. Whitford Equipment Company, Inc.. A 90-year-old family-run business based in Wellsville, NY, Whitford specializes in Morbark, TimberPro, Rayco, Barko, FAE Forestry Attachments, and Quadco Rotobec attachments. They also offer a wide variety of dozers, excavators and wheel loaders. Nearly 70-75% of their equipment sales are for the forest industry.
“We have full-time road people and parts people available for our customers,” said Joe Catalone, sales representative for Whitford, who has also known the Kocjancic family for 25 years. “Our service guys are dispatched 80 percent of their working hours. We’re a very hands on company.”
According to Steve Heckman, equipment buyer and seller for Whitford, the company tries to go the extra mile to do anything to help the customer.
“We do all we can to keep our customers happy and that’s a challenge. And I don’t say that lightly,” stated Steve. “As (former) contractors, we know what it’s like to be out on the field, on the job, and not have your equipment operating effectively. We know it’s not good to be ignored when help is needed right away. We’re in the game. We’re in there with our customers.”
Joey bought his Rottne forwarder used directly from Blondin Inc. Joey made his decision based on the recommendations of a few other contractors that lived in his area. Once he realized that Blondin was located in Indiana, PA, only a two-hours’ trip away if he needed service or parts, that too sealed the deal for him. He made a call to Rikard Olofsson, president of the Pennsylvania-based Blondin Inc., the factory-owned distributor of Rottne machines.
“The forwarder that Joey purchased is one of our most popular models,” Rikard stated. “It’s been a good, dependable machine and it’s been out for quite a few years…since 1988. It’s extremely reliable. And it’s operator friendly and very straight forward to use.”
Highlighting the benefit that Joey is contributing to Mike’s chipping business, Rikard stated, “Joey is a hard worker. He’s a go-getter. Joe’s supplying Mike with clean wood, not wood that’s been dragged in the mud by cable skidders. It will keep the knives clean on the chipper for a long time. It’s such a benefit to have clean product to work with. It’s really the best way to go in this industry.”
Joey’s Log Max 7000XT head also serves him well in the pulpwood industry by offering him the versatility of any type of application, whether he works with hardwood, mostly maple and beech, or softwoods. According to Greg Porter of the Log Max North American subsidiary, based in Vancouver, Washington, the 7000XT is the “true North American head” rather than the Scandinavian head that much of their models resemble. The XT is much heavier and weighs 700 pounds more than the previous 7000 version.
“We took all our customers’ comments regarding our previous heads and improved the product based on their ideas,” stated Porter. “Joey’s got a great product and it works well with what he’s doing. It should work well for him for a very long time.”
Joey’s family members had mixed reviews regarding his move to mechanization. His dad, John Sr., thought Joey’s timing was off because of the economy. His brother, John, a hand logger, wasn’t surprised that Joey stepped into the challenge. But his cousin, Mike, is the most grateful by far and he remembers well the difficulty it was for his own move into chipping 11 years ago.
“When Joey went into cut-to-length I wanted to support him,” said Mike. “He was gonna spend hundreds of thousands of dollars on this venture. He went in at the absolute worst time in the history of the industry. Joey didn’t do what was expected at the time, which shows the kind of man he is. He did what was unheard of. I reflected back to him what my own dad, Edward F. Kocjancic, had said to me when I stepped out into chipping. My dad was the only one who supported me and he was the guiding force behind my decision to bite the bullet and do it.”
Mike credits Joey for all the success they’re experiencing. Between Mike’s expertise in chipping, marketing, and trucking the product, and Joey’s logging expertise, the two have a combination that can’t be matched.
“People in the industry say luck is a key ingredient in the success of any harvesting operation,” stated Mike. “I would say that for Joe Kocjancic the harder he worked the last year the luckier he got.”
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