SPARTA, Virginia — It takes a lot of lumber to make a lot of pallets — lots of pallets. In the case of John Rock Inc., one of the top pallet manufacturing companies in the United States in terms of production volume, that’s about 100,000 pallets per week coming out of its plant in Coatesville, Pennsylvania. To put that in some perspective, it takes about five tons of nails daily to assemble that many pallets, and the company’s cut-up operations generate four truckloads of sawdust per day.
John Rock has to haul in three-fourths of the lumber it needs and relies on more than 75 mills to keep it supplied. The plant is equipped with five lines of Brewer equipment to remanufacture cants into pallet components. “We use a lot of wood,” said Bill MacCauley, owner and president of John Rock.
Now, the company operates its own affiliated sawmills to help keep the pallet plant supplied with wood. John Rock has added two sawmills in Virginia, one by acquisition and another it has built from the ground up. The two mills together will supply about 25-30% of the wood — cut stock and cants — the company’s manufacturing plant requires.
“It’s more of controlling your own destiny,” explained MacCauley when asked why he decided to get in the sawmill side of the business. He added, “Lumber is plentiful, but it won’t always be.”
When MacCauley went looking to develop a sawmill, he chose Caroline County, a rural community roughly
half-way between Richmond and Fredericksburg. One main reason he selected the area was it has an abundant supply of hardwood timber.
The company chose a 38-acre parcel in the Sparta community of Caroline County, a site that contained a defunct sawmill, and broke ground for the project in December 2013. The new hardwood sawmill, about 200 miles from the John Rock pallet plant in Pennsylvania, began operating in January of this year. In the course of developing the new mill, the Rock team also decided to purchase another sawmill business in the first half of 2014 in Dillwyn, Virginia, which is located about 60-plus miles west of Richmond. Although MacCauley owns the company, he stressed that big decisions involve a lot of the key managers and employees at the company.
Karl Moore, the manager of Rock Technologies, the trucking division of the company, was instrumental in convincing MacCauley to jump into the sawmill business. Tim Pierce and David “Woody” Woodring helped fine tune the Sparta mill and trained employees. Steve Marrs and the maintenance crew at John Rock’s pallet plant assisted in building conveyors for the Sparta mill. Steve Hedrick, the chief financial officer of the company, kept the finances in line, which were a challenge at times with such a massive project. And Penn Cooper worked with the power company and an electrician to troubleshoot electrical concerns. MacCauley, “My entire team has helped make this reality.”
The design and construction of the new sawmill — Rock Wood Products — was spearheaded by Wesley Worrell of Central Virginia Millwright & Rigging. “Wesley built this mill from scratch and did an incredible job,” said MacCauley. “From buying the equipment to design and implementation, he oversaw the entire process.”
In the process of developing the mill, MacCauley and several key employees visited a lot of sawmills to learn about them – how they could be more efficient, how they dealt with unexpected circumstances. “What you don’t expect…It’s going to cost more than you thought.”
One thing that added a lot to the cost was the fire protection measures required to build the facility if it wasn’t going to have a sprinkler system. Fire walls and curtains added $300,000 to the cost of the building. “I have been told that this facility is the new standard when it comes to design and construction to reduce the need for fire suppression systems in a sawmill,” commented MacCauley. “This is the new level that other mills will be judged against.”
The mill was designed and built to be as maintenance free as possible, for easy clean-up, and to have a life of 40 years. “The biggest hurdle here was the size of the building,” noted MacCauley. The mill building was limited by local officials to 12,000 square feet or else it would need a sprinkler system.
Nearly all of the sawmill equipment was purchased used at auctions. MacCauley along with Karl Moore, Tim Pierce and Wesley Worrell attended auctions for sawmill equipment in Alabama, Ohio, and other states. While used equipment helped to keep the initial build cost down, it did add to some delays and other costs associated with retrofitting machines and getting everything working right.
The one major exception to buying used equipment was to purchase a new slab recovery system that was custom designed and built by Pendu Manufacturing Co.
While the mill is fully operational, some changes and improvements are still being made and planned in order for it to reach its production goal of cutting over 300,000 board feet per week. For example, electronic eyes are being added to better help manage the flow of material through the plant. “People don’t realize how long it takes to get a place like this up and running,” said MacCauley, and the cost “to turn round wood into square wood.”
“It’s expensive, man.”
Weekly production recently peaked at 265,000 board feet. About 50% of the mill’s production is pallet cut stock, 4/4 lumber or cants, and the other 50% is railroad ties and boards.
The mill was designed and set up to process low-grade hardwood logs. “We’re buying the low-grade log and trying to get flooring, #1 and #2 Common out of it,” explained MacCauley.
The company buys timber and contracts with loggers for harvesting, and it buys mixed hardwood logs ranging from 8-24 inches in diameter, tree length and cut to length.
The logs are cut to length in the yard by a Tigercat Knuckleboom and then loaded on the mill with a new Cat electric 569 knuckleboom loader. The logs pass through an inline MDI metal detector, then feed into a Cambio 30-inch debarker. After debarking, they are routed to one of two infeed decks, according to the size of the log. Large diameter logs are placed on the infeed deck that carries them to a Cleereman carriage and circular head saw, and smaller logs are moved to a Cooper overhead end-dogging scragg mill.
The head rig squares up the log. The scragg mill, equipped with twin circular saw blades that remove two sides of the log in one pass, processes the log into a two-sided cant, or, if it is going to be cut into a railroad tie, finishes the job of squaring up four sides for a crosstie. Slabs from the head rig currently are routed to the mill’s Precision 75-inch chipper as small slabs from the scragg mill, but slabs from the scragg mill that are big enough go to the Pendu slab recovery system.
Both machine centers feed material to a Ligna top arbor gang saw – cants from the head rig, and two-sided cants from the scragg mill. Material exiting the gang that requires edging is fed inline to a Cook edger, and flitches coming off the head rig are routed to the edger. The final stage before hitting the green chain is a Corley drop saw with eight saws.
The company is focused on recovering usable lumber from slab material. As Bill said, “Look and see what’s going into the chipper and figure out how not to chip it.”
The Pendu slab recovery system is pretty unique. “We’re doing something they never did before,” said MacCauley.
Because of space limitations, the slab recovery system had to be designed to cut the slabs into shorter lengths first, so the first step is a three-head trim saw to cut the slab into two lengths. The material then goes to an edger to produce two three-sided boards. The next step is a double-end trim saw. Finally, a vertical arbor gang makes the final cuts to produce the finished pallet deck boards.
“It’s pretty slick operation,” said MacCauley. With Pendu’s help the company is still “tweaking” some aspects of the slab recovery system in order to optimize production. Eventually, slabs coming off the head rig also will be routed to the slab recovery system to produce more pallet cut stock.
The company may add automated stacking equipment in the future. About eight of the company’s 25-30 employees currently work on the green chain, pulling lumber and cants by hand. “While the cost of such a system is not cheap, over the long run it makes sense if you can cut labor costs,” explained MacCauley, who visits the sawmill about once a week or every two weeks for an overnight stay.
The Rock team chose machines that run circular saw blades instead of bandsaw blades, although John Rock has plenty of bandsaw machines at its Pennsylvania plant.
Chips are sold to a paper mill. Sawdust goes to a plant for boiler fuel or other markets, and bark also is supplied for boiler fuel.
MacCauley stands by his decision to build the mill even though low-grade hardwood lumber is more plentiful now than it was in recent years. “Lumber is plentiful today, but it won’t always be that way. These two sawmill facilities provide us some degree of control over our supply chain.”
Low-grade hardwood markets have eased recently with the availability of more wood. The oil and gas industry is down, noted MacCauley, hobbled lately by falling prices for oil. With curtailments in oil and gas exploration, that industry is purchasing less road mats and other low-grade hardwood material it requires. “That material is going into the pallet market,” commented MacCauley. However, if the oil and gas industry picks up again, so will the demand for road mats, and that industrial wood material will flow back into that industry.
There is a “huge concern” in the industry about the future of small sawmills that pallet companies depend on for wood material, observed MacCauley. The owners are aging out and retiring. “The trick now,” he added, is to recruit younger to come into the sawmill business and teach it to them.
The experience in the sawmill side of the business is going to help the business in another way, MacCauley suggested. It has given the Rock team a better understanding of the costs that go into making lumber, information that will help the company make informed, shrewd decisions about buying lumber from other mills.
Although purchasing used equipment for the mill saved money, there are pros and cons to buying used and new equipment, MacCauley noted. While new machines may cost more, they are ready to go to work and presumably will have a long life. There is a cost involved in getting used equipment up and running and maintained.
When MacCauley considered starting a sawmill, he thought, “What’s wrong with me?”
“It’s been an education,” planning and building a sawmill, he said.
A big reason for John Rock’s success is its employees. MacCauley pointed to various employees who have risen up through the ranks. “I believe in hiring from within and promoting good workers.” For example, one of the sawyers at the Dillwyn mill had never been a mill manager before, but he had been a smart, hard-working employee who he wanted to give a shot to do something new and critical for the operation.
Key employees at the sawmill include plant manager Greg Tallman, office manager Penny Bowen, Lauren Smith, who handles accounting chores, and procurement forester Daniel Jones.
The pallet business, like other industries is fairly simple, suggested MacCauley. “Companies want a product…Make it and deliver it on time.”
While the business may be simple, execution is challenging. MacCauley and the entire Rock team has the pallet plant in Pennsylvania humming and is a showcase to the industry. They hope to bring that same efficiency to the Virginia sawmills even though it is a work in progress.
