MARBLE, Arkansas – J.R. Banks Lumber Co. has a long history of making railties for the railroad industry. Now, it is branching out into making cut stock for the pallet industry.
The company, owned by Mike Banks, completed a relocation at the beginning of the year. It operates two mills on nearly 75 acres, currently employing about 16 people. One mill produces railties, lumber and pallet cants; the other mill, new this year, is devoted to making pallet cut stock. The company used to operate two tie mills but consolidated the operations into one.
Target production for the sawmill is 13,000 board feet daily in ties, lumber and cants. The goal for the scragg mill is 30,000 board feet.
“This year, everything is so screwy” because of the economy, said Mike. Since it started up, the scragg mill has been operating with only half a crew, mainly because the company does not have enough orders.
“We never made cut stock before, and it hasn’t been the easiest market to break into,” acknowledged Mike. Another challenge has been small orders; the company cuts one size of material and the next day has to set up for a different size. “It’s back and forth, not steady,” he said.
The company was started by Mike’s grandfather, J.R. Banks. He worked for a business that bought and treated ties and sold them to railroads. When it closed the yard where he worked, J.R. began opening sawmills to make ties and other low-grade hardwood lumber products.
“He did a little bit of everything – stave mills, tie mills,” recalled Mike. “He did make pallet parts.” He operated a number of mills in northwest Arkansas, moving them according to timber availability. He moved the business to Marble in northwest Arkansas in the 1960s.
Mike went to work for his grandfather in 1993. When J.R. died about a year later at age 84, his two sons inherited the business. Mike later bought the interests held by his father and uncle to become sole owner.
Mike, 39, went to George Washington University in Washington, D.C. and earned a degree in history. When he graduated, he didn’t have any immediate job prospects. His father told him, ‘You have to go to work – now. My dad will hire you.’ So, he began working for his grandfather.
“We buy everything on scale,” said Mike. He uses the Doyle scale for buying hardwood logs. He buys logs 8-feet-8 inches long for the tie mill or sawmill. “We’ll buy under 12 inches, but we try not to buy too small,” he said.
On the log yard for the tie mill, a Cat 924G loader unloads the logs from incoming trucks, stacks the wood and feeds the mill. The head rig is a portable Hurdle mill that has been set up as a stationary sawmill with electric power. It runs a Simonds inserted tooth circular blade, 56 or 60 inches, with Simonds Dominator carbide bits. The only other machine in the mill is a Miner edger.
“It takes about six men to run it,” said Mike, speaking of the tie mill.
The Hurdle mill is used to square up the log usually to a 7×9 tie. If the log cannot make a tie, it will be squared up to a 4×6 or 4×7 pallet cant. Boards coming off the sides are put through the Miner edger to be edged. The lumber is sometimes graded and sometimes shipped ungraded. It is sold to flooring companies in Missouri and Arkansas and to a concentration yard in Missouri. Most lumber coming off the tie mill is cut to 4/4. The sawmill slabs and edgings are collected into bunks and sold to a charcoal plant.
The scragg mill, in a new 80×120 building, was equipped with a new Timberland Machinery Big Jake scragg saw, and Timberland Machinery also supplied all new conveyors and material handling equipment.
For the scragg mill, Mike buys hardwood logs by weight, tree-length or 8-foot logs down to an 8-inch top and no bigger than 14 inches on the butt end. The wood is unloaded in the yard with a Prentice 210 log loader, which is self-propelled. The Cat 924G loader feeds the logs to a merchandiser, which uses a 60-inch circular blade to saw the logs into bolts or blocks. A trough conveyor carries the log into the mill building.
The Big Jake scragg has two circular blades that remove two sides from the bolt, and then the two-sided bolt passes through a bandsaw splitter. When it exits the Big Jake, the bolt has been processed into a three-sided cant.
Slabs coming off the Big Jake are routed to a Timberland Machinery edger. Edged slabs and the three-sided blocks are conveyed to a green chain and then to a Timberland Machinery trimmer. After being trimmed, the material is resawn on either a Brewer five-head horizontal bandsaw line or a Brewer two-head horizontal bandsaw line. Big pieces can be routed back to the bandsaws via a return system.
The lumber is cleaned by a Timberland Machinery de-duster, exits onto a belt, and is stacked by hand into Samuel Kent Baker racks.
All scrap material from the scragg mill is routed into a Morbark vibrating conveyor, and, along with the slabs and edgings from the sawmill, is fed into a Montgomery hog. The wood grindings are sold for mulch. The company also has a dust collection system that pulls sawdust from the bandsaw machines and the splitter.
Mike sells to pallet manufacturing companies in Arkansas and Missouri and relies on contract truckers to deliver orders. He has been selling mainly through brokers because he did not already have an ongoing business relationship with any pallet companies.
Mike relies on Corinth Mill Supply and Ozark Machinery for saw blades and service.
Mike described his interest in starting the scragg mill. At the time, there were six other tie mills within 50 miles and one scragg mill. “It just seemed like people were competing for the same type of logs,” he said. “I figured if I got into the pallet market, I’d have some diversity…and be able to hopefully do a little better.”
“This is the one way I thought would work,” he added. “The problem is, we just started at the wrong time” because of the economic slowdown.
He looked at other scragg mills in the region to see what kind of mills other companies were running. “I heard some good news about the Big Jake,” he said. “That was a plus.”
This year has been “really abnormal,” Mike conceded. Business was extremely slow back in December and January, and he even shut down the scragg mill for a few weeks.
When the economy returns to normal, he expects ties to account for about 25% of revenues, lumber 15%, cants 10%, and pre-cut stock about 60%.
Mike is a member of and active in several trade organizations. He is on the board of directors of the Arkansas Timber Producers Association. He also is a member of the Arkansas Forestry Association, the National Hardwood Lumber Association and the National Federation of Independent Businesses.
Tie markets have been steady in recent years, but tie buyers began grading more strictly this summer, according to Mike. Some companies also are buying a 6×8 tie, he said, “but I don’t know how long that is going to last.”
Mike’s company was one of the few mills in the region that offered health insurance to employees, but he had to drop it last year because of rising premiums. “It just got so expensive,” he said.
The company enjoys a stable work force. One worker recently retired after about 40 years with the company, and several others have more than 20 years of service.
Mike lives with his wife and three children in Fayetteville, which is about 35 miles away. Sometimes he makes trips to pick up parts before going to work. During the school year, he takes his children to school before leaving for work. Mike handles all the administrative tasks, such as payroll and bookkeeping, does most of the selling and also performs some of the major electrical or hydraulic work on equipment. One employee oversees the scragg mill, and the sawyer in the tie mill supervises those operations.
Most of the scragg mill was finished toward the end of 2008, but it took a while to get all the equipment running smoothly and synchronized. The start-up also was impacted by the economic slow-down. Mike shifted employees to staff the scragg mill.
Mike has noticed an up-tick in business activity the last 30-60 days. “Lumber seems to be moving a little better now,” he said, both lumber coming off the mill and pallet cut stock. “Prices aren’t great but at least the product is moving.”
His uncle told him that Mike is the 7th generation of his family in the wood business. “I didn’t really plan on being here very long, and now I’ve been here almost 17 years,” he said.
Mike’s three children are ages 5, 4 and 1. “So I don’t have a lot of leisure time…By the time I get home, it’s them, and on the weekend, it’s them.”
