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Foreign Agricultural Service

Forest Products Division

Agriculture Handbook No. 662

Revised §'^ July 199(1 4;..:

A Guide to Exporting Solid Wood Products

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Abstract

This handbook provides a guide for U.S. wood products producers to develop a successful export marketing strategy. It covers how to obtain accurate and up-to-date export marketing information so that the production, scheduling, and shipping of U.S. wood products can be done profitably.

Keywords: Wood products, export markets, exporting, marketing information, export financing, shipper's export declaration, shipping documentation, business organization, market development cooperators, trade servicing.

Acknowledgments

This is the first revision of the handbook originally published in 1986 by William G. Westman, who specifically acknowledged work done by David R. Schumann and Ralph T. Monahan, USDA Forest Service in The Lumberman's Guide to Exporting.

Portions of this revised publication draw on work done by the USDA's Office of Trans- portation and its publication, Export Handbook for U.S. Agricultural Products. Thanks also go to the state and federal agencies, cooperators, and others mentioned in this publication who provided information and assistance.

The material in this publication was prepared solely for the purpose of assisting U.S. firms interested in exporting U.S. solid wood products. References to private publications and firms do not imply endorsement by the Foreign Agricultural Service or the U.S. Department of Agriculture.

:|^ United States })) Department of

Agriculture


Forest Products Division

Agriculture Handbook No. 662

Revised July 1990

A Guide to Exporting Soiid Wood Products By Cynthia Evans Agricultural Economist

Contents

Page

Introduction

Exporting Wood Products ^ Trade Servicing 5

Supply Considerations 6

Pricing Products for Export 6

Financing Exports Payment Options for Export Shipments 8 Letters of Credit and Invoices 9 Foreign Credit Insurance Association (FCIA) 10 Export-Import Bank (Eximbank) of the United States 11 Overseas Private Investment Corporation (OPIC) 11 Small Business Administration (SBA) 11 U.S. Trade and Development Program (TDP) 12 Trade Finance Corporation/American International Group (TRAFCO) 12

Export Shipping Carriers 14 Terminals 15 Packaging and Shipping 15 Export Documentation 15 Shipper Export Declarations (SED's) 17 Exporting Checklist 20

Business Organization "In House" 22 Export Management Companies (EMC's or agents) 22 Export Trading Companies (ETC's) 22 Export Merchants (EM's) 22 Foreign Sales Corporation (FSC) 23

Export Market Information and Assistance United States Government

U.S. Department of Agriculture 25 Foreign Agricultural Service 25

Overseas Offices 25 Market Reports 25 Export Services 26

Office of Transportation 27 Animal and Plant Health Inspection Service 27 Forest Service 28

U.S. Agency for International Development 29 U.S. Department of Commerce 29 Office of the United States Trade Representative 30

State Departments of Agriculture and State Export Agencies 30 Private Sources 32

USDA Export Programs Cooperator 34 Targeted Export Assistance 38 Credit Guarantees 40 P.L 480 41

Major Markets Japan 50 European Community (EC) 53 United Kingdom 53 West Germany 55 Italy 56 Belgium/Luxembourg 56 Spain 57 Canada 59 People's Republic of China 61 South Korea 63 Taiwan 66 Africa/Middle East 68 Oceania 70 Australia 71 Latin America 71

Table 1 — Major Activities Associated with Exporting 3 Table 2 — Elements of Pricing Goods for Export 7 Table 3 — Shipping Documents Required in Exporting 16 Table 4 — U.S. Exports of Solid Wood Products by Principal Products/

Countries, 1989 44 Table 5 — Tariffs Imposed on Imports of U.S. Solid Wood Products in

Selected Countries 47

Figure 1 — U.S. Wood Export Markets, 1989 46 Figure 2 — Value of U.S. Wood Products, by Commodity, 1989 46 Figure 3 — Value of U.S. Wood Exports to Japan 52 Figure 4 — Value of U.S. Wood Exports to the EC 58 Figure 5 — Value of U.S. Wood Exports to Canada 60 Figure 6 — Value of U.S. Wood Exports to China 63 Figure 7 — Value of U.S. Wood Exports to South Korea 65 Figure 8 — Value of U.S. Wood Exports to Taiwan 67 Figure 9 — Value of U.S. Wood Exports to Middle East 69 Figure 10 — Value of U.S. Wood Exports to Africa 70 Figure 11 — Value of U.S. Wood Exports to Australia 73 Figure 12 — Value of U.S. Wood Exports to Latin America 76

Selected Publications 77 Samples of Shipper's Export Declaration and APHIS Phytosanitary Certificate 80

Appendix III — Samples of "Export Briefs," "Buyer Alert," & Foreign Importers Listing 85 Addresses of State Foresters 89 Desk Offices of the International Trade Administration, U.S. Department of Commerce 92

Appendix VI — U.S. and Foreign Commercial Service District Offices 93 Appendix VII — Small Business Administration District Offices 96 Appendix VIII — Glossary of Forest Products and Exporting Terms 99 Appendix IX — Forest Products Volume Conversion Units 106 Appendix X — Forest Products Shipping Weights and Volumes 113

Appendix I Appendix II

Appendix IV Appendix V

III

Introduction

This revision of the 1986 handbook provides a guide for U.S. wood product producers to develop a successful export marketing strategy. It covers how to obtain accurate and up-to-date export market information so that the production, scheduling, and shipping of U.S. wood products can be done profitably. The flow chart on page 3 provides an outline of the major activities associated with exporting and export marketing. The outline includes many of the topics covered in this guide to exporting wood

products.

Major topics include trade servicing, supply considerations, a review of the major U.S. wood product markets, sources of export information, USDA export programs, export financing, shipping and documentation, product pricing, and the business organization of an export-oriented company.

By the turn of the century, U.S. exports of wood products are projected to be at least 50 percent larger on a value basis than the estimated 1989 level of $6.0 billion. Environmental concerns about dwindling tropical hardwood forests, coupled with export bans/restrictions on logs and rough lumber in tropical hardwood exporting countries, will increase demand for both U.S. hardwoods and softwoods. The Philip- pines, Indonesia, Cote d'Ivoire, and Thailand are recent examples of countries that have either banned or curtailed exports and/or commercial logging.

Traditionally, the U.S. forest products industry has not considered the international market to be an outlet for its products. Only during the 1980's did companies begin to seriously consider exports as a long-term market for wood products—partly in response to the U.S. recession in 1981-82. Yet, while export value has doubled since 1985, exports of wood products still represent a minor portion of U.S. annual wood production.

The decision to enter the export market is not for every company. Producers must have the flexibility or willingness to tailor a product line to meet specifications quite different from those used in the United States. Producers should be prepared to develop a long-term foreign market development strategy because commitment to foreign importers will include staying with sales when their market is weak.

Before getting involved, consider carefully your short- and long-term corporate objectives, the resources available, the level of international business expertise required, and the commitment your firm must make to servicing the export market. Servicing the export market will retain, expand, and diversify your outlets for U.S. forest products.

Strategic export planning in the world market can provide new jobs, greater income, and increased profitability for U.S. wood producers. A stronger forest products industry will lead to new investment in forest management, thus assuring a continuous supply of wood and fiber for the United States and its customers overseas.

A genuine commitment to exporting will include long-term sales to overseas markets regardless of domestic market conditions. "In and out" exporting will guarantee a company's failure in the overseas market and give U.S. producers a reputation for being unreliable.

Exporting clearly requires a long-term outlook as the following table illustrates. The decision to enter the export market requires the producer to commit sufficient managerial, economic, and financial resources to the task. Each company must weigh the advantages and disadvantages of exporting to determine if projected profits, possible losses, and inherent risks justify management's commitment to exporting.

Table 1 — Major activities associated with exporting

STEP!

Management Commitment

STEP II

Analyze objectives, strengths, and weaknesses

1. Short- and long-term goals 2. Personnel 3. Resources 4. Production 5. Financing 6. Knowledge of export marketing

STEP III

Develop contacts and collect current market information in the United States

1. U.S. Government and State agencies 2. Banks with international departments 3. Freight fon/varders 4. Marine insurance agents 5. U.S. port authorities

STEP IV

Conduct market analysis

1. U.S. export statistics 2. Foreign import statistics 3. Current market developments and trends 4. Import barriers 5. Other factors (political, economic, geographic, and cultural)

STEPV

Country/market selection

1. Demand potential/ trends 2. Product identification 3. Standards and specifications and trends 4. Language requirements 5. Distribution channels 6. Business practices 7. Tariff and nontariff barriers 8. Licensing/phytosanitary requirements 9. Legal considerations 10. Shipping costs

STEP VI

Develop marketing approach targeted to one or two countries

1. Organization of the firm 2. Determine production 3. Contact foreign importers 4. Schedule marketing/ sales trip to the country or market

STEP VII

Trade servicing

1. Product development/ modification in response to changes in demand 2. Attention to importer's needs/ commitment to the market 3. Periodic visits to the market to maintain good customer relations and develop new contacts 4. Refine marketing approach

Exporting Wood Products: Advantages, and Risks

The decision to enter the export market requires the producer to commit sufficient managerial, economic, and financial resources to the task. Each company must weigh the advantages and disadvantages of exporting to determine if projected profits, possible losses, and inherent risks justify management's commitment to exporting.

The advantages of exporting wood products include new marketing and financial opportunities, diversification of risk, and increased financial leverage and credit. In addition, revenue derived from export sales permits spreading fixed costs over a greater number of production units. Wider margins may be realized on higher valued products.

Producing for foreign markets can also have its downside. Tailoring wood products to foreign standards and specifications requires skilled personnel for procurement and milling operations.

Plans to produce according to foreign specifications may not match with existing high- speed, high-volume manufacturing practices. As a result, production costs per unit may be higher. If wood products designed and produced to foreign specifications need to be sold on the domestic U.S. market, they may require additional processing such as resawing, planing, or sanding.

Common mistakes made by companies entering the export market are:

• Failure to obtain qualified export counseling.

• Failure to develop an international market plan.

• Insufficient commitment by top management to overcome the initial difficulties and financial requirements of exporting.

• Insufficient care in selecting overseas agents or distributors.

• Pursuing orders from around the world, the shotgun approach, instead of establishing a basis for profitable operations and orderly growth.

• Neglecting export business when the U.S. market booms.

• Failure to treat international customers on an equal basis with domestic counter parts.

• Unwillingness to modify products to meet regulations or cultural preferences of other countries.

• Failure to print service, sales, and warranty messages in locally understood languages.

• Failure to consider use of an export management company or other marketing intermediary.

• Failure to consider licensing or joint-venture agreements.

• Failure to realize that it takes patience and understanding to develop the ties necessary to obtain and retain export sales.

Success or failure in exporting hinges on an exporter's willingness to allocate sufficient resources to research foreign demand, develop contacts, and produce, market, ship, and sell wood products overseas. These activities are referred to as "trade servicing.

Trade Servicing: If employed conscientiously, trade servicing helps overcome many of the disadvan- The Key to Success ^^ges and pitfalls in export marketing and helps lessen the effect of economic forces

and other factors which an exporter cannot control.

There is no substitute for a good working relationship with the overseas buyer. This is particularly important given the U.S. wood exporter's reputation overseas as an "in-and-outer" in servicing the export market. The producers who have stayed in the export market, in good times as well as bad, have proved to be the most effective. Being reliable sometimes means sacrificing short-term gains for long-term market development opportunities.

Supply Consideration: What Do You Have To Sell Overseas?

Deciding what you can sell overseas depends on a host of variables. You will have to consider what you are producing now, your access to timber resources with respect to species, qualities, and quantities; access to processing facilities; transportation; proximity to ports; and how adaptable your current operation is to cutting special orders or scheduling the mill to cut or produce for export markets. Success in the export market may even involve adapting production facilities to produce for foreign grades and specifications.

Before taking on the world, you may do best by focusing first on one or two countries where U.S. wood products are familiar to importers. Become knowledgeable about the country and develop a consistent pattern of trade contacts with importers in that country. Nurturing a commitment to marketing in one or two countries before branch- ing out will pinpoint your strengths, weaknesses, and limitations in serving export markets. Once your expertise develops you may feel confident in testing new markets and new products, and in diversifying your export market portfolio.

Pricing Products for Export

Table 2, on page 7, outlines the elements of a price quote for each stage through which products move as they pass from the mill to the port of destination overseas. The quote basis used, such as free-on-board (f.o.b.) vessel or cost, insurance, and freight (c.i.f.) named port overseas, will depend on the arrangement negotiated with the importer. A price quote that more closely reflects the cost of goods delivered to the importer's yard has a much better chance of being negotiated and accepted than a quote based on delivery to the U.S. port prior to export. Quotes should include information on shipping arrangements and dates, payment terms, weights, and total cubic volume. The actual price quote will include these elements but will be influenced by foreign import demand, freight rates, insurance costs, domestic supplies, and proximity to exporting facilities and ports.

Quotes based solely on domestic U.S. prices plus additional transportation, handling, and insurance costs may or may not be acceptable in international trade. This depends on the negotiations between the U.S. exporter and the foreign buyer. Current benchmark or average prices for specific species and grades of forest products in international trade may be obtained from the publications and newsletters outlined in this handbook.

In the United States, forest products are bought and sold according to volume designations such as 1,000 board feet, 1,000 square feet, or 1,000 linear feet. In foreign countries, common volume units in the wood trade are 1,000 cubic meters, 1,000 square meters, and metric tons.

The exporter must be familiar with converting U.S.-based volume measurements to the metric system. Forest products volume conversion ratios and methods are shown in appendix IX. Shipping weights and volumes for a number of products and species are shown in appendix X.

Table 2 Elements of pricing goods for export

Element F.o.b. F.o.b. F.o.b. C.&f. C.&f. C.i.f. (Factory) (Point of (Vessel) (Named (Named (Named

export) port) port) port)

Cost of producing wood products

Packaging

Processing/handling

Inland transportation

Unloading fees at port

Forwarder's charges

Consular fees

$ $ $ $ $ $

$ $ $ $ $ $

$ $

$

$ $ $

$

$

$ $ $

$ $ $ $ $

$ $ $ $

$ $ $ $

Ocean freight

Marine insurance

Terms used: f.o.b.—free on board; c.& f.—cost and freight; c.& i.— cost and insurance; and c.i.f.—cost, insurance, and freight.

Source: Inbound Traffic Guide, 1978.

FINANCING EXPORTS

Payment Options for Listed below are nine options for receiving payment for exported goods. The best Export Shipments method to use depends on a number of factors including the credit rating of the foreign

customer, any foreign exchange restrictions imposed by the importing country, and competitive goods and credit facilities available to overseas buyers. Your bank or financial institution should be knowledgeable about most of these payment options.

Cash In advance—This is the most desirable and safest method of receiving payment since the exporter has immediate use of the money and is not concerned with repayment schedules. The percentage of trade conducted under this method is low.

Open account—This is the riskiest method because it is merely an arrangement between the buyer and seller for payment at a later date with no legal document or recourse available to the exporter. Also, the exporter's capital is usually tied up until time of payment. This method is used by exporters who deal with longstanding customers of unquestionable integrity.

Consignment sales—Under this method, the goods are available to the foreign firm on a deferred payment basis. The exporter usually secures political and commercial risk insurance for the goods until payment is received.

Sight draft—Money is payable at sight of the completed documents. This method is used when sellers wish to retain control of the shipment either for credit reasons or for the purpose of title retention. A bank acts as an intermediary and is presented with the original bill of lading endorsed by the shipper and other documents (such as packing lists, consular invoices, and insurance certificates) which are not released to the importer until payment of the draft. The advantage of this method is that the exporter retains title to the goods until payment is made. The disadvantage is that the importer can refuse to pay the draft, and the exporter is responsible for shipping the goods back to the United States at the seller's expense or reselling to a third party in the foreign country.

Time or acceptance draft—This method is similar to a sight draft except that the importer may defer payments of the draft for 30, 60, 90, or 180 days. Although the exporter does not have any legal recourse if the importer does not pay, a foreign or U.S. bank does act as an intermediary for collection purposes.

Date draft—The date draft requires payment by a specified date regardless of the date on which the goods and the draft are accepted by the importer. Date drafts prevent the importer from extending the period of credit as a result of postponing receipt of the goods.

Delivery orders—Some countries do not recognize or permit sight draft shipments, including negotiable bills of lading. Shippers may consign the merchandise to a third party, such as an import broker, in the foreign country on a straight bill of lading. The shipper will write a letter called a "delivery order" to the third party authorizing release of the shipment to the bearer of the original delivery order. The required documents will be sent to the importer's bank with instructions to the broker to release goods to the importer only after the draft is accepted. The importer's bank is usually the third party.

Letters of Credit and Invoices

Letters of Credit—The "letter of credit" is a document issued by a bank at the importer's request in favor of the exporter obligating the importer to pay for the shipment when the bank receives the required shipping documents. There are two types of letters of credit. The first is an irrevocable letter of credit confirmed by a U.S. bank. This guarantees the seller that payment terms and conditions of the letter credit have been met. The second type is an irrevocable letter of credit confirmed by the foreign bank but not the U.S. bank; payment is guaranteed by the foreign bank. The first type is preferred because the U.S. bank accepts the responsibility to pay and the exporter receives payment as soon as the documents are presented to the bank.

Barter and Countertrade—Countertrade is an arrangement for payment or financing by a means other than a cash-for-goods basis. Barter is the easiest form of countertrade to understand: goods for goods. Bartering benefits Third World countries by offsetting the influence of other market forces that may work against their competitive position including high interest rates and a high relative strength of the U.S. dollar compared to other foreign currencies. Countertrade may be considered as an alternative payment or financing scheme and is promoted by centrally planned economies. The method is not generally used by U.S. companies because it increases costs, requires additional management time and planning, and is characterized by detailed contract requirements. In the ideal countertrade arrangement, a company receives goods that it can use internally or sell to established customers.

Selling or distributing countertraded goods which are not traditionally handled by the firm will require new marketing practices and channels. Additional costs should be anticipated when handling new products obtained in countertrading. The company may consider employing a countertrade specialist or trading company to sell the goods.

Information required in the letter of credit (L/C) must match with other shipping documents and invoices. Information from an American Express Company brochure lists some of the most common errors and oversights associated with shipping documenta-

tion:

Merchandise description not identical to that in the letter of credit (L/C). Buyer's name not identical to that shown in the L/C. Total amount not identical to that shown in the draft. Excess drawing or excess shipment. Net value in excess of L/C amount. Prices not as specified in the L/C. Incorrect extension of prices. Omission of the price basis, such as f.o.b., f.a.s., or c.i.f., specified in the L/C. Inclusion of charges not specifically permitted under the terms of the L/C, such as commission, storage, or messenger costs. Not marked "PAID" when specified in the L/C. Not certified, notarized, or visaed if required by the L/C. Absence of statements required by the L/C. Type of packing, weight, or marks omitted from invoice. Marks and numbers not consistent with other documents. Weights not consistent with those shown in other documents. Gross weight shown for net when not expressly permitted by L/C. Order and license numbers required by L/C omitted.

• Goods termed "used" or "second hand" when not allowed by L/C. • Absence of specified signature. • Insufficient number of copies.

Foreign Credit The Foreign Credit Insurance Association (FCIA) is an association of leading private /prMA^"^^ Association insurance companies which works in cooperation with the Export-Import Bank of the ^ ' United States (Eximbank). FCIA offers export credit insurance policies protecting U.S.

exporters against the risk of nonpayment by foreign debtors due to commercial (insol- vency, default) or specified political (war, revolution, currency inconvertibility) reasons.

FCIA offers a wide variety of policies for short-term sales (up to 180 days) and medium-term sales (generally, up to 5 years). Products must be of U.S. manufacture and contain no more than 49 percent foreign content (including labor, but exclusive of markup) for short-term sales, and generally no more than 15 percent foreign content is allowable for medium-term sales. Coverage is also available for services and for operating and financing lease transactions.

The widely used Multi-Buyer Export policy is generally written to cover shipments during a 1-year period and insures a reasonable spread of an exporter's eligible sales. It enables the exporter to make quick credit decisions, providing faster service to overseas buyers, and reduces paperwork. The exporter can obtain financing and can offer competitive credit terms to attract and retain buyers around the globe even in higher risk markets. The policy insures short-term sales with repayment terms generally up to 180 days and, in an alternative version, covers medium-term sales, with repayment stretching out to 5 years, or longer under certain circumstances.

At the inception and at each annual renewal of the Short-Term Multi-Buyer policy, the exporter may choose to cover 90 percent of commercial risks and 100 percent of political risks, or choose equalized coverage at 95 percent for both commercial and political risk. Certain agricultural commodities may be insured under this policy, with terms extended to 1 year, if needed, and with commercial coverage increased to 98 percent. On short-term transactions coverage applies to the gross invoice amount and, in many cases, to interest at FCIA specified rates. Since medium-term sales require a minimum 15 percent cash payment by the buyer on or before due date of first install- ment, coverage here applies to the balance—the financed portion—of the transaction plus interest at FCIA specified rates.

The Multi-Buyer Export policy has a deductible feature similar to that of major medical and other forms of insurance.

The policy is subject to limits. The aggregate limit represents the insurers' maximum liability under the policy. Exporters make their own credit decisions for shipments up to the amount of a discretionary credit limit (DCL), after checking the country limitation schedule (CLS) and documenting the credit worthiness of the buyer as specified in the DCL endorsement to the policy. For larger amounts, a special buyer credit limit (SBCL) is available upon application to FCIA.

For additional information, contact FCIA at 40 Rector Street, 11th Floor, New York, NY 10006. Tel. (212)227-7020.

10

Export-Import Bank of the United States

Overseas Private Investment Corporation (OPIC)

Small Business Administration (SBA)

The Export-Import Bank (Eximbank) of the United States is the U.S. Government agency that facilitates the export financing of U.S. goods and services. Eximbank helps U.S. exporters compete against foreign governments subsidized financing in overseas markets. Eximbank offers four major export finance support programs: loans, guarantees, working capital guarantees, and insurance.

Lending Programs—Eximbank's loans provide competitive, fixed interest rate financing for U.S. export sales of capital equipment and services. Eximbank extends loans to foreign buyers of U.S. exports and intermediary loans to fund responsible parties that extend loans to foreign buyers. These loans are made at low, fixed interest rates according to the Organization for Economic Cooperation and Development arrangement. Special features are available for small businesses.

Guarantee Program—Guarantees provide repayment protection for private sector loans to creditworthy foreign buyers of U.S. goods and services. The guarantees provide coverage for both political and commercial risks.

Working Capital Guarantee Program—Eximbank also offers guarantees to lenders to support pre-export financial needs. The Working Capital Guarantee Program can help small- and medium-sized exporters obtain the financing they need to produce and market goods for sale abroad.

Insurance—The insurance program administered by the Foreign Credit Insurance Association, offers insurance policies to protect U.S. exporters and banks against the political and commercial risk of nonpayment by foreign debtors. Special policies exist for small or new-to-export businesses.

Inquiries should be directed to Eximbank Marketing Division, 811 Vermont Avenue, NW., Washington, DC 20571. Tel. (202) 566-4490; Small Business Hotline: (800) 424- 5201.

OPIC is a U.S. Government corporation that promotes U.S. investment in less developed countries. OPIC's finance program is oriented towards medium- to long-term investments that involve significant developmental benefits. The program provides insurance coverage for U.S. investments against expropriation, inconvertibility of local currency, or losses resulting from war, revolution, or civil disorders. OPIC does not handle export financing directly but may assist in financing complementary projects, such as a distribution yard for U.S. wood products. Insurance on letters of credit may also be obtained in the absence of FCIA or other commercial insurance. The insurance covers 90 percent of the investment plus attributable earnings. For additional information, contact OPIC, 1615 M Street, NW., Washington, DC 20527. Tel. (202) 457-7010. Fax:(202)331-4234.

The mission of the Small Business Administration is to aid, counsel, assist, and protect the interests of small business; ensure that small businesses receive a fair portion of Government purchases, contracts, and subcontracts, as well as of the sales of Gov- ernment property; make loans to small business concerns, state and local development companies, and the victims of floods or other catastrophes or of certain types of economic injury. The SBA also licenses, regulates, and makes loans to small business investment companies.

11

Export Revolving Line of Credit Program (ERLCP)—The Small Business Administra- tion (SBA) can guarantee up to 90 percent of a bank line of credit to an eligible small business or Export Trading Company (ETC) to finance the acquisition of raw materials, inventory, or labor needed to produce, acquire, or market the product or service to be exported. The ERLCP may not exceed 18 months or $750,000. Funds may not be used to acquire fixed assets or retire existing debt.

The Export Trading Company must have been in business for 1 year (not necessarily in exporting) prior to applying for an ERLCP loan through its bank.

SBA Regular Business Loan Program—Under this program an eligible small business or Export Trading Company may obtain longer-term financing (depending on use of proceeds). Up to $750,000, or 90 percent of the loan, may be obtained on an SBA- guarantee basis. Up to $150,000 (depending on availability of funds) can be obtained as a direct loan under this program. Interest rates may be fixed or variable.

Regular Business Loan Program—Funds may be used to obtain plant or equipment and for working capital. However, export trading companies with any bank equity participation are not eligible for these SBA financing programs. SBA can assist only those eligible small businesses and export trading companies which have the majority of their assets in the United States. Funding through these programs cannot be used to establish joint ventures overseas.

Small Business Investment Companies (SBIC)—Equity capital or long-term financing may be obtained by eligible small businesses from SBIC's which are licensed by SBA, if these SBIC investment companies have an investment strategy that includes such activities. SBIC's may invest in export trading companies in which banks have equity participation, provided other SBIC requirements are met. For further information and a copy of a directory of SBICs, contact the Office of Investment, Small Business Admini- stration, 1441 L Street, NW., Washington, DC 20416. Tel. (202) 653-2806. Fax: (202) 254-6429.

U.S. Trade and Development Program (TDP)

The U.S. Trade and Development Program (TDP) of the U.S. International Develop- ment Cooperation Agency promotes U.S. exports to developing nations. The program provides financing for feasibility studies for public and private sector projects in developing economies which would lead to the export of U.S. products and services. Helping U.S. businesses win construction contracts overseas is one of the main objectives of the TDP. For example, an export trading company of construction, architecture, and engineering firms might approach the TDP for financing a construction, building, or housing project which could lead to an increase in U.S. wood products exports. Other studies include large-scale energy generation and conservation, infrastructure, mineral development, agribusiness, and basic industrial facilities all of which could use U.S. wood products. For additional information on country eligibility, developmental priorities, and U.S. goods procurement requirements, contact the U.S. International Development Cooperation Agency, Washington, DC 20523. Tel. (703) 875-4357.

Trade Finance Corporation (TRAFCO)

TRAFCO offers fixed and floating interest-rate financing for medium-term export loans insured by a major insurance companies. Export credit insurance covering commercial

12

and political risk is required in this financing program. TRAFCO "conduit" securities, representing a segment of a pool of export loans, are certificates that can be sold to institutional and private investors. The "pools" are held by a trustee who receives payments on behalf of the holders of the certificates. TRAFCO funds are generated through the U.S. capital market. Additionally, the program has effectively introduced export financing paper to the capital market. Principal buyers include insurance companies, fiduciaries, mutual funds, and public funds. For more information, contact TRAFCO, 2121 Ponce de Leon Blvd., Suite 920, Coral Gables, FL 33134. Tel. (305) 446-5607.

13

Export Shipping

Carriers

The development of a successful export strategy must encompass a thorough knowledge of shipping procedures, documents required, and methods. The mechanics of shipping include: (1) attention to packaging, including banding of bundles, grade stamping, labeling, and color coding; (2) proper documentation; (3) scheduling the best shipping routes and carriers; and (4) an understanding of U.S. and foreign customs, regulations, tariff rates, and plant health requirements.

Often, the details of export shipping may be handled by a "freight forwarder," who acts as an exporter agent shipping goods overseas. Freight forwarders are licensed by the Federal Maritime Administration to facilitate the movement of goods from U.S. ports. They may advise the exporter regarding freight costs, port charges, consular fees, documentation fees, insurance, and handling costs. In addition to assuring that the goods arrive overseas in good condition, they review the letter of credit and other necessary documentation and may prepare the ocean bill of lading. After shipment, the forwarder will send all documents to the paying bank to confirm the export of the commodity.

Additional information on freight forwarders may be obtained from port authorities, the International Trade Administration; the U.S. Department of Commerce; banks; or from the National Customs Brokers and Forwarders Association of America whose address is One World Trade Center, STE 1109, New York, NY 10048. Tel. (212) 432-0050.

USDA's Office of Transportation also helps exporters with problems concerning the transportation of U.S. agricultural products, including forest products. For further information, see page 27.

Three types of ocean carriers ship products overseas. The first are conference lines which consist of an association of ocean carriers providing common rates and services. Individual conference carriers may take independent action and offer shippers lower rates. Also shippers may form associations to negotiate lower rates with conferences.

The second type of carriers are the independents. Independent rates may be higher than other carriers, but they also may be lower when in direct competition with conference carriers. Both conference and independent carriers operate on regular schedules and trade routes. Independent proprietary carriers include major forest products companies with their own transportation operations. These lines specialize in forest products and other bulk commodity shipping.

The third type of carrier is the tramp vessel. These carriers generally handle only bulk cargo and are not on regular schedules or trade routes. According to the Western Wood Products Association, tramps are the most common means of shipping wood products as they are relatively economical.

A booking contract is mandatory to reserve space for the cargo on a specified vessel. The contract is binding insofar as the carrier has the right to charge for reserved space that is not used or to charge for canceled reservations without adequate notice.

14

Terminals

Packaging and Shipping

Export Documentation

The use of specialized forest products handling facilities at the ports of export and destination prove to be the most cost effective. This will be reflected in lower freight rates and landed costs. Moving lumber and other forest products through general cargo terminals can be very expensive.

Packaging products is of vital importance particularly when shipments are bound for ports with inadequate handling and storage facilities. Lumber, plywood, and veneer bundles must be securely strapped and protected from damage because of rough handling, moisture, or weathering. This is essential in foreign ports where bundles may be stored uncovered while awaiting pickup or delivery. Bundles should be clearly marked according to foreign specifications and include the company logo or color

coding.

Wood products are shipped by a variety of methods including break bulk, containers, flat racks, and lash barge. The most common methods are break bulk for lumber and plywood shipments and containers for higher valued shipments such as kiln-dried dimension stock, lumber clears, and veneer.

In general, wood shipments from U.S. Atlantic ports are containerized, whereas those from the Gulf and West Coast ports tend to be break bulk. There are exceptions depending on the destination country and the type of wood product shipped.

Freight containers are capable of holding approximately 4,000 board feet of logs or 10,000-14,000 board feet of lumber depending on the product and moisture content. Maximum cargo weights are, however, limited by carriers to comply with laws established to protect roads and bridges. A 40-foot container, therefore, can only be loaded with about 46,000 pounds of forest products when traveling over U.S. highways. Containers loaded at the port may have higher cargo weights.

The documentation of exports is just as important as the goods you are exporting. Faulty information or incomplete documentation can lead to delays in transporting goods to their destination. Forty-six separate documents are the average for one shipment of goods being sold abroad. Many countries have laws that must be followed when completing export forms. A freight forwarder, a specialist in this area of exporting, can often provide the necessary documentation for shipping your goods.

Every country varies as to the number and kind of documents that are necessary for importing different goods. The Department of Commerce's district office closest to you or your forwarder can provide you with up-to-date and specific information on export documentation.

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Table 3 Shipping documents required in exporting^

Documentation Prepared by

Export License - issued upon application to the U.S. Department of Commerce Exporter

Destination Control Statement - prevents export to unauthorized destinations Freight forwarder

Shipper's Export Declaration - for compiling U.S. statistics/enforcing U.S. export controls i(

Banking papers "

Letters of Transmittal - for items eligible for duty drawback »

Notice of Exportation - for items eligible for duty drawback

Certificates of Origin - for items eligible for duty drawback "

Export Packing List - itemizes product shipped t(

Domestic Packing List - itemizes product shipped

Insurance Certificate

Exporter

Freight forwarder

Pro Forma Invoice - a formal price quotation with a detailed account of individual costs

Letter of Credit - a promise to pay a specified amount of money upon receipt by the bank at the buyer's request in favor of the seller

Bill of Lading - a detailed description of the cargo including destinations. Two types are necessary:

Exporter

Importer

Ocean-freight forwarder

an inland and an ocean bill of lading

Phytosanitary Certificate - a certificate stating that the goods are free of disease and infestation

^ More detailed information about exporting documentation may be obtained from the international departments of major banks, freight forwarders, or the United States Council of the International Chamber of Commerce, 1212 Avenue of the Americas, New York, NY 10036.

APHIS

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Shipper Export ^ The Shipper Export Declarations (SED's) are very important documents that are used Declarations (SED's) ^^^ ^^^ly ^^ ¡dentify cargo, but to determine the official U.S. export statistics as well.

These trade statistics are used throughout the Government and industry organizations and distributed to the industry. The importance of accurate information on the export declarations can not be understated.

Forms:

The forms used for export declarations are: SED Form 7525 or 7525-V-Alternate. These forms and continuation sheet must be copied. Sample copies may be obtained from the Bureau of the Census, Washington, DC 20233. When privately printing SED's, the forms must conform in every respect to the official forms in size, wording, color (black ink on buff paper for Form 7525-V), weight of paper stock (not less than 16 nor more than 20 pounds commercial substance), and arrangement, including printing the Office of Management and Budget Approval Number in the upper right-hand corner of the face of the form. The alignment of form 7525-V corresponds with air waybills and other vertically oriented documents while form 7525-V-Alternate corresponds with the ocean bill of lading and other horizontally oriented documents. (See sample documents in appendix II.) However, either form may be used regardless of the method of transportation or destination.

The Bureau of the Census has a program. Automated Reported Program, to which exporters, carriers, or freight forwarders may submit monthly reports by computer (tape, floppy disk, or direct transmission). For further information on this program, contact the Automated Data Reporting Branch, Department of Commerce, Suitland, MD 22222. Tel. (301) 763-7700.

When Required:

SED's are required for nearly all shipments (see section 9 for exemptions) from the United States, Puerto Rico, U.S. or Puerto Rican Foreign Trade Zones (FTZ), and the U.S. Virgin Islands. SED's are not required for shipments from the United States or Puerto Rico to U.S. possessions, except to the U.S. Virgin Islands or from a U.S. possession to the United States or Puerto Rico.

Number of Copies Required:

a) One copy for shipments to Canada, Puerto Rico, and the U.S. Virgin Islands;

b) One copy for exports through the U.S. Postal Service; and

c) Two copies for all other shipments.

Additional copies may be required for export control purposes by the International Trade Administration, other government agencies (when authorized), customs directors, or the local postmaster.

Preparation:

The SED must be prepared in English in a permanent medium (ink, typewritten, etc.) with the original signed (a signature stamp is acceptable) by the exporter or an authorized agent of the exporter. The agent must be authorized by a power-of-attorney or item #23 on form 725-V (an informal power-of-attorney) must be completed.

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Requirement for Separate SED's:

Separate SED's are required for each shipment from one exporter to one importer on a single carrier (including each rail car, container, or other vehicle). However, customs directors may waive this requirement if multiple car shipments are made under a single loading document and cleared simultaneously. Also, merchandise requiring a validated export license shall not be reported on the same SED with goods moving under a general license.

Presentation:

a) Postal shipments—SED's must be delivered to the postmaster when the packages are mailed.

b) Pipeline shipments—SED's must be submitted to the customs director within 4 working days after the end of the calendar month.

c) All other shipments—SED's must be delivered to the exporting carrier before exporting.

d) Exporting carriers are required to file SED's and manifests with customs.

e) Shipments from an interior point—SED's may accompany the goods being transported to the exporting carrier or the port of exportation, or they may be delivered directly to the exporting carrier.

f) Shipments exempt from SED filing requirements—a reference to the exemption must be noted on the bill of lading, air waybill, or other loading document for verification that no SED is required.

Corrections:

Corrections, amendments, or cancellations of data may be made directly on the SED if it has not already been sent to the Bureau of the Census. If the SED has been sent to the Bureau, any corrections, cancellations, or amendments must be filed on a copy of the original SED but marked correction copy and filed with the customs director or the postmaster where the declaration was originally presented.

Retention of Siiipping Documents:

Three years is the usual length of time that the Bureau of the Census, U.S. Customs Service, and the International Trade Administration may require exporters or their agents to produce copies of shipping documents.

Exemptions:

a) Shipments (excluding postal shipments) where the value of the goods under each schedule B number or HS code is $1,500 or less and for which a validated export license is not required and when shipped to countries not prohibited by the Export Administration Regulations.

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b) Shipments through the U.S. Postal Service that do not require a validated export license: (1) when the goods are valued $500 or less, (2) if either one of the parties is not a business concern, or (3) the shipment is not for commercial consideration.

c) In-transit shipments not requiring a validated export license and leaving for a foreign destination by means other than by ocean vessel.

d) Shipments from one point in the United States to another point by routes passing through Canada or Mexico, and shipments from one point in Canada or Mexico to another point by routes passing through the United States.

Administrative Provisions:

SED's and the information that is written on them are confidential and are exempted from the Freedom of Information Act. SED's are only for official purposes authorized by the Secretary of Commerce in accordance with 13 U.S.C Section 301. Neither Commerce nor the Census Bureau will give out the information to anyone except the

exporter or his or her agent.

Information from SED's (except common information—that is, information that is on both the SED and the manifest) may not be copied from manifests; other exporters may not give SED's or their information to anyone for unofficial purposes (for example, if the customer requests a copy of the SED).

Copies of the SED's may be supplied to exporters or their agents when they are needed to comply with official requirements; for instance, authorization for export, export control requirements, or USDA requirements for proof of export in connection with subsidy payments. These copies will be stamped certified and are not for any other use and may not be reproduced in any form.

When the Secretary of Commerce or a delegated person determines that withholding information on a particular SED is contrary to "national interest," the Secretary or delegate may make the information available while taking safeguards and precautions

as deemed appropriate.

A SED presented for export is a representation by the exporter that all statements and information follow the export control regulations. The product described on the SED must be described the same on all applicable licenses.

It is unlawful to knowingly make false or misleading representations for exportation. This is a violation of the Export Administration Act 50 U.S.C App 2410. It is also a violation of export control laws and regulations to be connected in any way with an

altered SED.

Goods that have been, are being, or for which there is probable cause to believe they are intended to be exported in violation of the Export Administration Act are subject to seizure, detention, condemnation, or sale under 22 U.S.C. section 401.

To knowingly make false or misleading statements relating to information on the SED is a criminal offense subject to penalties in 18 U.S.C. section 1001.

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Violations of the Foreign Trade Statistics Regulations (FTSR) are subject to civil penalties as authorized by 13 U.S.C. section 305.

Regulations:

Detailed information about the SED and its preparation is contained in the FTSR (15 CFR Part 30). Also, the FTSR should be consulted for special provisions under particular circumstances. Copies may be purchased from the Bureau of the Census, Washington, DC 20233. Information concerning export laws and regulations of the International Trade Administration is contained in the Export Administration Regula- tions, which may be purchased from the Superintendent of Documents, Government Printing Office, Washington DC 20402.

Reference Schedules

Schedule B—Statistical Classification of Domestic and Foreign Commodities from the United States. For sale by the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402 and local U.S. Customs District Directors.

Schedule C—Classification of Country and Territory Designations for U.S. Foreign Trade. Free from the Bureau of the Census, Washington, DC 20233. Also included as part of Schedule B and USTSA.

Schedule D—Classification of Customs Districts and Ports. Free from the Bureau of the Census. Also included as part of Schedule B and USTSA.

Schedule K—Classification of Foreign Ports by Geographic Trade Area and Country. Also free from the Bureau of the Census.

Foreign Trade Statistics Regulations—For sale by the Bureau of the Census.

Exporting Checklist The following checklist is a general guide outlining the steps involved in completing an export shipment under a confirmed letter of credit (L/C). The actual procedure will vary according to the bank's financing arrangements and the services provided by the freight forwarders and steamship companies. The price basis (f.o.b., f.a.s., c.i.f., etc.) and the terms of sale agreed upon between the exporter and importer also will affect the procedures to follow in exporting. Check first with the international department of your bank and the freight forwarder to determine all financing and documentation requirements and procedures.

• U.S. exporter and foreign importer agree on the terms of the sale. • Importer applies for a letter of credit (L/C) at the foreign bank. • Foreign bank issues the L/C to the exporter's bank. • Importer sends a purchase order accompanied by a copy of the L/C to the exporter. • Exporter prepares the order for shipment, arranges for inland transportation of the

shipment to the port, and issues shipping instructions to a freight forwarder. • Exporter's freight forwarder selects a suitable vessel, contacts the outbound

steamship line office, and books space on a particular vessel. The freight forwarder also collects or prepares the exporting documents, including the inland bill of lading, ocean bill of lading (B/L), insurance, and phytosanitary certificates. (The exporter may arrange for marine insurance through a private insurance company.)

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Freight forwarder pays the due bills from the outbound steamship line and transmits to the exporter the original ocean bill of lading, together with the bill covering the inland freight, the stevedoring costs, and the freight forwarder's services. Exporter prepares a "commercial set"—a negotiable bill of lading, a copy of the L/C, an invoice, a bill for the freight forwarder's charges, insurance certificates, and, if necessary, a customs invoice. The exporter sends the commercial set to the exporter's bank. Upon receipt and acceptance of the commercial set, the bank pays the exporter covering the shipper's invoice in accordance with the L/C issued by the importer's bank. The bank transmits the commercial set and a debit notice to the importer's bank for payment. The exporter or freight forwarder sends a non-negotiable copy of the bill of lading to the importer notifying that the cargo has been shipped. After the vessel has sailed, the outbound steamship line's office sends the manifest to the inbound steamship office, together with non-negotiable copies of the bills of lading, arrival notice, delivery receipt, and container list. Outbound steamship office submits to the U.S. Customs one non-negotiable ocean bill of lading copy with the shipper's export declaration. This must be accomplished within 4 working days of the vessel's clearance from the U.S. port. Depending on the terms of the sale and financing arrangements, the exporter may be liable for the shipment after the vessel has sailed. Check with the bank, freight forwarder, and insurance company to determine your rights, responsibilities, and liabilities, as well as the proper procedures to follow in completing the export sale.

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Business Organization of Firms Involved In Exporting

"In House" The organization of the firm and how your wood products are sold overseas are related and depend on several factors including the size of the company, productive capacity, types of wood products and degree of processing, previous exporting experience, and business conditions overseas. "In-house" organization of the business involves direct selling of wood products by the U.S. producer to the foreign importer. The producer is usually responsible for shipping the product overseas.

Traditional and customary marketing and business practices in a foreign country will dictate how the products will be sold. Depending on the country, direct selling may involve working with foreign sales representatives, agents, or distributors. For example, agents are very active in the wood products trade in the United Kingdom and other European countries. In Japan, trading companies are the primary contacts.

"In-house" organization will provide the company greater control over the export marketing procedures for the firm's products. In general, there are higher start-up costs and fewer economies of scale under this organizational structure than with the others described below.

Export Management Companies (EMC's or agents)

Export Trading Companies (ETC's)

Export Merchants (EM'S)

EMC's are generally small, closely held companies which represent wood products manufacturers in export marketing. The EMC may represent a number of small, unrelated companies and provide benefits (economies of scale) relating to foreign sales, marketing missions, and scheduling or shipping products for export. The EMC often retains the identity of the manufacturer when dealing with foreign importers, whereas agents work under their own names.

The largest domestic barriers to exporting—lack of knowledge of foreign marketing, limited credit facilities, and legal restrictions in cooperating with other U.S. companies (antitrust violations)—may be hurdled by forming an export trading company (ETC). ETC's may assume the risks involved with international trade by taking title to the products and assuming responsibility for marketing and selling the products overseas.

One publication, the Export Trading Company Guidebook is available for sale from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402. Additional assistance may be obtained from the Office of Export Trading Company Affairs, International Trade Administration, U.S. Department of Commerce, Washington, DC 20230. Tel. (202) 377-5131.

Similar to an ETC, an export merchant (EM) may take title to a producer's goods and be responsible for selling to the foreign importer. The advantages of using an export merchant include:

1. Wood products are sold to an export merchant domestically. Producers do not need to be familiar with foreign business practices—this is the responsibility of the EM.

2. The EM may handle all intermediate processing and handling functions, such as pressure treatments or kiln-drying of lumber prior to export.

3. The EM may serve as a "sorter" or distribution yard for lumber and other products. This permits lumber to be regraded specifically for export and specialty markets. Lower volume, high-quality products may become more marketable as a result of using an EM.

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Foreign Sales Corporation (FSC)

4. EM'S may become familiar with the operation of small lumber mills and wood producers and may provide valuable assistance in producing wood products for the export market.

Under the Foreign Sales Corporation (FSC) Act of 1984, an FSC is a corporation established in a foreign country or U.S. possession, excluding Puerto Rico, which may obtain a tax exemption on a portion of the earnings generated by the sale or lease of export property and the performance of some services. As a general rule, 15 percent of the profits from qualifying export transactions are treated as tax-free income.

An FSC program was intended to replace the Domestic International Sales Corpora- tion (DISC) program which has been interpreted by members of the councils of the General Agreement of Tariffs and Trade (GATT) as an illegal tax subsidy for exports.

FSC's cannot provide long-term tax deferrals and retention of profits to secure tax benefits. Rather, FSC's obtain tax exemptions on approximately 30 percent of the FSC foreign trade income if the FSC buys from independent suppliers—a smaller percent is given if parent corporations are the suppliers. Special administrative pricing rules apply if the FSC purchases from related suppliers.

An FSC must be incorporated and have its main office in a foreign country or U.S. possession, including the U.S. Virgin Islands, American Samoa, Guam, and the Northern Marianas. Additionally, an FSC must have at least one director who is not a U.S. resident and maintain a set of books at its main off-shore office. It cannot have more than 25 shareholders and cannot have any "preferred" stock. An "election" to become an FSC must be filed with the Internal Revenue Service (1RS).

An FSC may be incorporated in the following countries and U.S. possessions:

American Samoa France New Zealand Austria Germany Northern Marianas Islands Barbados Grenada Norway Belgium Guam Pakistaan Canada Iceland Philippines Cyprus Ireland South Korea Denmark Jamaica Sweden Dominica Malta Trinidad and Tobago Egypt Morocco U.S. Virgin Islands Finland Netherlands

When selecting a location for the FSC you should take into account that the 1RS will not allow foreign tax credits for foreign taxes imposed on the FSC's qualified income. Because of this, most FSC's are incorporated in the U.S. Virgin Islands.

Small exporters may establish either a "small" FSC or an "interest-charge" FSC depending on the level of export income. Small FSC's, «with gross export income of $5 million or less, have less stringent rules to meet.

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FSC's can be formed by manufacturers, nonmanufacturers, and export groups. They can function as principals, buying and selling for their own account, or as commission agents. The FSC may be related to a manufacturing parent company or can be an independent merchant or broker. Commission agents are required to perform specific activities with respect to the export sale.

Other management activities must be performed at the offshore location. For further information about FSC's, jointly-owned FSC's, minimal foreign presence FSC's, small business FSC's, and export trading companies, contact: Office of Trade Finance, U.S. Department of Commerce, Room 4420, 14th and Constitution Avenue NW., Washing- ton, DC 20230. Tel. (202) 377-3277.

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Export Market Information and Assistance

U.S. Department of Agriculture

United States Government


The Foreign Agricultural Service (FAS) of the U.S. Department of Agriculture is responsible for developing, maintaining, and expanding export markets for U.S. agricultural commodities—including solid wood products. FAS provides foreign market information, works to gain foreign market access for U.S. farm, food, and forest products, and cooperates with U.S. nonprofit trade associations in conducting market development activities in overseas markets.

Overseas Offices—FAS represents U.S. agriculture overseas through a network of agricultural counselors, attaches, and trade officers in 96 foreign posts covering 110 countries. The staff supervises market development activities, reports to FAS/Wash- ington, and alerts the U.S. trade to foreign market opportunities and competition.

The U.S. agricultural counselor/attache office is in frequent contact with foreign buyers and overseas representatives of U.S. firms and associations, and helps U.S. agricultural exporters, associations, and allied groups establish contacts with government officials and the foreign trade. In addition, 15 Agricultural Trade Offices (ATO's) have been opened in Algiers, Baghdad, Beijing, Caracas, Guangzhou (Canton), Hamburg, Istanbul, Jeddah, Lagos, London, Manama, Seoul, Singapore, Tunis, and Tokyo. These trade offices serve as a one-stop service center with facilities for trade representatives, nonresident private trade groups, and others engaged in exporting and importing U.S. agricultural commodities.

Annual reports on wood products production, marketing, and trade for 30 selected foreign markets are also available on an annual subscription basis. The markets are:

Australia Austria Belgium Brazil Burma Canada Chile China Cote d'Ivoire Denmark Egypt

Finland France Germany,

Federal Republic Indonesia Italy Japan Korea, South Malaysia Mexico Netherlands

New Zealand Philippines Spain South Africa Sweden Taiwan United Kingdom U.S.S.R. Venezuela

The annual reports are prepared by FAS agricultural counselors, attaches, and trade officers overseas. To order a subscription for the scheduled reports, voluntary reports, and report updates contact the Reports Officer/FAS, USDA, Room 6078-South Build- ing, Washington, DC 20250-1000. Tel. (202) 382-8924.

Market Reports—FAS issues quarterly circulars on the world supply and demand situation for wood products on an annual subscription basis. The reports include summaries of U.S. exports of logs, lumber, plywood, veneer, wood chips, and a variety

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of other softwood and hardwood products. Foreign wood products production, supply, and distribution data are also provided.

The charge for four issues is $10.00 for domestic mailing and $15.00 for foreign mailing. For further information, contact FAS/lnformation Division, Room 4644-South Building, USDA, Washington, DC 20250-1000. Tel. (202) 382-9445.

Export Services—Through FAS services, agricultural exporters can keep abreast of foreign market development opportunities with marketing research reports, trade leads, product publicity, and listings of prospective foreign importers. FAS is working to expand its telecommunications link with its agricultural trade offices overseas in an effort to increase the volume and timeliness of trade leads available to U.S. agricultural exporters.

FAS serves as the liaison between U.S. companies and foreign importers seeking U.S. wood and other agricultural products. FAS works to help U.S. producers introduce products in new markets and further expand established markets.

FAS's agricultural counselors, attaches, and trade officers transmit market information, trade, and economic statistics electronically to FAS offices in Washington, DC. U.S. companies can subscribe to the following export services:

1. Trade Leads provide trade leads in overseas markets. They are distributed in three ways:

a) Electronic Dissemination. Electronic access to trade leads is available on a daily basis via computer information services that offer the leads on electronic bulletin boards. To access the trade inquiries you need a minicomputer with a modem and communications software. Listed below are the companies to contact directly to receive this service.

Agridata Resources, Inc. Dialcom, Inc. 330 East Kilbourn 600 Executive Blvd., Suite 150 Milwaukee, Wl 53203 Rockville, MD 20852 Tel. (800) 558-9044 Tel. (301 ) 770-4280

Master Productions Intellibanc Corporation 7300 Candletree Lane, Suite 21 2214 Torrance Blvd., Suite 101 Lincoln, NE 68506 Torrance, CA 90501 (402) 489-2183 (213) 618-9597

California Agricultural Technology Institute Maple and Shaw Avenues Fresno, CA 93470-0115 (209) 294-4872

b) Export Briefs is a weekly bulletin of all trade leads received during the previous week. Export Briefs also includes highlights of upcoming trade shows, foreign trade developments, and changes in trade policy issues, product standards, and labeling

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information. Information in each inquiry is identical to that in the electronic access. The subscription fee is $75 per year.

c) The Journal of Commerce, a daily paper, publishes export opportunities supplied by the U.S. Department of Agriculture regularly in its column "Agricultural Trade Leads." For information, contact The Journal of Commerce, 110 Wall Street, New York, NY 10005. Tel. (800) 221-3777; in New York: (212) 425-1616.

2. Foreign Buyer Listings are on a database that includes 15,000 foreign firms interested in importing agricultural (including wood) products. Each listing may be format- ted (a) by specific commodity for the entire world; (b) by specific country for all commodities; and (c) by specific commodity and country. These lists provide company and contact name, address, telephone, and telex number. The charge for each list is $15.

3. The Buyer Alert Notice uses high-speed telecommunications links, to forward specific information about the products you want to sell to foreign importers in 50 countries. This product publicity service is offered at no charge.

For further information on trade leads. Export Briefs, Foreign Buyer Lists, or the Buyer Alert contact: Foreign Agricultural Service, Room 4649-S, U.S. Department of Agricul- ture, Washington, DC 20250-1000. Tel. (202) 447-7103.

Refer to appendix III for examples of Export Briefs, Foreign Buyer Listings, and the Buyer Alert.

Office of Transportation

USDA's Office of Transportation (OT) provides the following services:

• Technical Assistance—OT publishes export handbooks, directories, and statistical news reports; sponsors export seminars; and participates in technical exchanges with other countries.

• Economic Studies—OT analyzes such topics as the future transportation needs of the U.S. agricultural export community, the impact of various cargo preference initiatives on agricultural shippers, and the feasibility of a transportation-oriented export trading company.

• Technological Research—OT works to develop better procedures for shipping agricultural commodities (including forest products), evaluates equipment needs, and analyzes and tests transportation packaging techniques.

For further information contact the USDA Office of Transportation, Washington, DC 20250-4500. Tel. (202) 653-6275.

Animal and Plant Health Inspection Service

USDA's Animal and Plant Health Inspection Service (APHIS) actively participates in international programs to protect against the spread of plant and animal pests and diseases. Many foreign countries require that shipments of wood products be accompanied by phytosanitary certificates, issued by APHIS at the request of the shipper, certifying that the products conform to foreign quarantine import requirements.

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For example, the European Community (EC) requires a phytosanitary certificate for U.S. shipments of veneer logs certifying that the logs have been fumigated with methyl bromide according to approved EC treatment schedules and procedures. (See appendix 2 for an example of a phytosanitary certificate.)

Inspection is handled by Federal and State government cooperators and the inspec- tions are normally not valid if conducted more than 14 days prior to the export of the commodity. The exporter must make written application for inspection and make the commodity available for physical inspection.

Certification is recognized by foreign plant protection services and by regional plant protection organizations.

Phytosanitary certificates are not issued to satisfy letter of credit or other commercial contract terms and are not certifications of grade or quality. Criteria on foreign country plant import requirements may be obtained by contacting: Protection and Quarantine (PPQ), APHIS, USDA, at ports of export, or by writing PPQ, APHIS, USDA, Port Operations, Room 633, Federal Building, Hyattsville, MD 20782. Tel. (301) 436-8537.

Forest Service

USDA's Forest Service conducts research and analysis of U.S. timber supply, demand, and wood products trade. The Forest Service experiment stations and the forest products laboratory can provide useful information and research on exporting.

The Southern Forest Experiment Station handles research involving exports of wood products from the southern United States and on the costs of exporting. Contact: Principal Economist, USFS/SFES, Room T-10034, 701 Loyola Avenue, New Orleans, LA 70114. Tel. (504) 589-6651 ; Fax: (504) 589-3961.

The Pacific Northwest Forest Experiment Station handles macroeconomic modeling of U.S. and international markets of wood products. Contact: Principal Economist, USES/ PNWFRES, P.O. Box 3890, Portland, OR 97208. Tel. (503) 231-2193; Fax: (503) 326- 2272 or (503) 326-3096.

The Northeastern Forest Experiment Station handles research on U.S. hardwood exports. Contact: William G. Luppold, Project Leader, Forestry Scientist Laboratory, Box 562-B, Princeton, WV 24740. Tel. (304) 425-8107.

The Northeastern Area State and Private Forestry office provides technical assistance on the exporting of forest products. Contact: Director, USFS/NA, Five Radnor Corpo- rate Center, Suite 200, 100 Madsen Ford Road, Radnor, PA 19087.

The Southern Region State and Private Forestry Office provides technical assistance on the exporting of forest products. Contact: R-8, S&PF, 1720 Peachtree Road, NW., Atlanta, GA 30367. Tel. (404) 347-7930; Fax: (404) 347-4488.

The Forest Products Laboratory conducts research and provides information on foreign and domestic woods and wood products. Contact: Information Office, Forest

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Products Laboratory, One Gifford Pinchot Drive, Madison, Wl 53705-2398. Tel. (608) 231-9200; Telex: 7400032; Fax: (608) 231-9592.

U.S. Agency for International Development (AID)

The Agency for International Development (AID) publication, Export Opportunities With Agency for International Development, explains AID'S programs. The AID Docu- ments Kit for Export Suppliers is another useful publication. Both can be obtained by writing to the Office of Business Relations, AID, Washington, DC 20523. Additional AID publications are available on a subscription basis including: AID Financial Export Opportunities (SBC), AID Procurement Information Bulletins (PIB), or AID Small Business Memo (SBM).

U.S. Department of Commerce

The International Trade Administration (ITA) of the U.S. Department of Commerce provides a wide range of services and programs to assist U.S. firms in developing export markets. The best point of contact for U.S. firms is their local Department of Commerce district office, of which there are 48 across the United States. These offices are run by the division of ITA known as the U.S. and Foreign Commercial Service. For those companies operating from foreign locations, there are 66 commercial offices, which are part of this same network, located in embassies and consulates in countries comprising more than 95 percent of the world market for U.S. products.

For information about a specific country, contact the appropriate country desk officer at the ITA. A list of ITA desk offices is provided in appendix V. U.S. and Foreign Com- mercial Service District Offices are listed in appendix VI.

The services provided by the Office of Trade Information Services, ITA, are listed below:

• Agent Distributor Service is handled through the district offices. U.S. commercial officers overseas locate interested and qualified representatives on behalf of a U.S. firm. The commercial officer prepares a report identifying up to six foreign prospects that have examined the U.S. firm's product literature and have expressed interest in representing the company. There is a charge per market or specific area.

• The Trade Opportunities Program (TOP) Notice Service offers individual messages on current foreign trade leads detailing specifications, quantities, end-use, delivery, and bid deadlines for the products requested by the foreign buyer. TOP'S are available only electronically via the Economic Bulletin Board. To subscribe, contact the National Technical Information Service (NTIS) at (307) 487-4630, or write to the NTIS at 5285 Port Royal Road, Springfield, VA 22161. The registration fee now is $25 and gives the user 2 hours of connect time. After the initial 2 hours, the user is charged 10 cents per minute of connect time.

• Customized Export Mailing Lists (EML) provide profile information which allows the subscriber to identify only the most relevant potential contacts. Gummed labels for direct mailings are also available. The cost for this service is $10 for the basic fee and 25 cents for each name.

• International Market Research (IMR) Surveys are organized under foreign country/ product categories and contain statistics and analysis of trade, information on end- users, purchasing patterns, marketing practices, trade restrictions, and key contacts in Government purchasing agencies and other organizations. IMR's cost $50 to

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Office of the United States Trade Representative

$200 and range up to 400 pages in length. These are available through the district offices via the Commercial Information Management System (CIMS).

• World Traders Data Reports (WTDR) provide background material on individual foreign firms, giving information about each firm's reputation, credit worthiness, and its overall reliability and suitability as a trade contact for U.S. exporters. WTDR's are designed to help U.S. firms locate and evaluate prospective customers overseas. Information includes: name, address, key contact, number of employees, type of business, general reputation in trade and financial circles, year established, sales territory, and products handled. The cost is $100 per report.

• Commercial News, USA (CNUSA) assists U.S. companies in advertising the availability of new U.S. products in foreign markets and provides one method for t esting new markets. Under CNUSA short descriptions of the products are published in the monthly publication Commercial News, USA. For further information on these publications contact the Information Management Division at (202) 377-4203.

• The Office of International Major Projects (OIMP) helps qualified U.S. firms develop exports by obtaining early information on upcoming engineering and construction projects valued at no less than $3 million. The office provides information to prospective U.S. bidders and special assistance to U.S. companies to enhance their ability to compete for contracts. A monthly listing of major projects is available. OIMP has a staff of project officers who will work individually with firms to assist them in competing for individual project contracts. Contact: OIMP, U.S. Department of Commerce, Room 2015B, Washington, DC 20230. Tel. (202) 377-5225.

• The Office of Forest Products and Domestic Construction offers various reports on foreign and domestic developments, and is active in export services. Contact: Director, Room 4045, ITA, U.S. Department of Commerce, Washington, DC 20230. Tel. (202) 377-0382

• The Office of Trade Finance (OTF) offers counseling and advice on countertrade only. Contact: OTF, ITA, U.S. Department of Commerce, Room 4004, Washington, DC 20230. Tel. (202) 377-3277.

The Office of the U.S. Trade Representative (USTR) is an agency of the Executive Office of the President. It is responsible for directing all formal U.S. trade negotiations and for formulating U.S. trade policy. USTR works closely with USDA and other agencies in this effort. It represents the United States in formal tariff and nontariff negotiations.

Individual exporters rarely have direct contact with this office except if they wish to file a complaint about unfair subsidized overseas competition or other trade practices which may violate the General Agreement on Tariffs and Trade (GATT). USTR may be reached at 600 17th Street NW., Washington, DC 20501. Tel. (202) 395-3230.

State Departments of Agriculture and State Export Agencies

State departments of agriculture and related agencies cooperate with USDA in promoting and marketing U.S. foods and other agricultural products abroad. Many of these State agriculture departments now have full-time international marketing specialists. Also, some State foresters have a trade specialist on their staff. The 1989 Roster of State Foresters is shown in appendix IV.

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These State departments of agriculture provide assistance to new-to-export and established exporting firms. In addition, they assist FAS in arranging itineraries and appointments for foreign buyers, agriculturalists, and government officials.

Forty-nine States, Guam, Puerto Rico, and American Samoa are members of four regional groups that work exclusively on coordinating and expanding activities for exports of food and agricultural products. The organizations and member States are:

Eastern U.S. Agricultural and Food Export Council, Inc. (EUSAFEC)

Members: Connecticut, Delaware, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont.

Headquarters: 2 World Trade Center, Suite 2717 New York, NY 10047 Tel: (212)432-0020. Telex: 420859 EUSAFEC. Fax: (212)488-205

Southern United States Trade Association (SUSTA) Members: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Puerto Rico, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia.

Headquarters: International Trade Mart 346 World Trade Center New Orleans, LA 70130 Tel: (504) 568-5986 Telex: 568598 SUSTA UR Fax: (504)568-6010

Mid-America International Agri-Trade Council (MIATCO)

Members: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin.

Headquarters: 820 Davis Street, Suite 212 Evanston, IL 60201 Tel: (312)866-7300 Telex: 880179 MIATCO CGO Fax: (312)866-7413

Western U.S. Agricultural Trade Association (WUSATA)

Members: Alaska, California, Colorado, Guam, Hawaii, Idaho, New Mexico, Oregon, Washington, Wyoming, Utah, Montana, and American Samoa.

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Headquarters: 13101 N.E. Highway 99, Suite 200 Vancouver, WA 98685-2876 Tel: (206) 574-2627 Telex: 298572 NEAUR Fax: (206) 574-7083

Private Sources A variety of private, credit-reporting, financial, and market-servicing firms target their services to the U.S. exporter. Generally, these companies provide weekly or monthly reports by world areas with special reports targeted to specific countries. Market research and studies outlining short-term trends in international markets and financing also are available.

The companies listed below provide many of these services and represent a small sample of firms providing this information. The following information was provided by the companies and citation in this publication does not represent an endorsement by the U.S. Department of Agriculture or any other U.S. Government agency. Additionally, no guarantees of commercial performance or reliability are intended nor intent of discrimination implied.

Equifax Services—Provides credit reports for countries throughout the free world through the Foreign Department of the New York Metro office. Regions and countries covered by Equifax include all of South America; all of Europe, except the Eastern Bloc countries; the Middle East, except for Iran, Iraq, Turkey, and Syria; and all of Asia, except for Thailand, the People's Republic of China, and North Korea. Equifax correspondents are generally business reporting agencies in their respective countries. They provide information about a foreign company's current directorship, ownership, annual turnover, and net worth, plus a description of its date of chartering, present size, and nature of operation. Cost of the reports is approximately $130-$140 each and varies by region or country.

Reports may be received by cable or telex for an additional charge of $15-$30. Con- tact: Equifax Services, New York Metropolitan Office, 80-15 164th Street, P.O. Box 10, Jamaica, NY 11431. Tel. (316) 466-2000; or Equifax Services Foreign Department. Tel. (718) 380-2022; Cable: RECCOM New York; Telex: 667607 RECCOM or 668365 RECCOM.

Predicasts—Compiles, organizes, and publishes information on industries, products, markets, technologies, and economics. Predicasts offers indexing services, statistical services, and abstracting services. In addition, Predicasts produces a series of industry-specific publications to keep patrons up to date with specialized ongoing information requirements on the latest international events. Additional reference tools, including a company thesaurus and a directory of source publications, exist to enhance the use of Predicasts' publications. The "F&S Index International" includes information on business developments in Latin America, the Middle East, Japan, Asia, Canada, Africa, and Oceania. The "F&S Index Europe" provides literature summaries for the European Community, Scandinavia, other countries of Western Europe, the USSR, and other countries of Eastern Europe. For further information, contact: Predicasts, Marketing Services Department, 11001 Cedar Avenue, Cleveland, OH 44106. Tel. (800) 321-6388 (outside Ohio); (216) 795-3000 (in Ohio); Telex: 985-604; Fax: (216) 229-9944.

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The Economist Intelligence Unit (ElU)—Offers a series of regular reports covering business conditions, trends, and prospects worldwide. ElU's "Country Reports" (published quarterly) provide latest facts and forecasts together with indepth analysis for

over 165 countries. In addition, a variety of monthly and quarterly publications are available on: Paper & Packaging, Commodity Forecasts, and Marketing in Europe. Other special reports recently published include "Waste Paper: Development & Forecasts to 1992" and "European Community: Economic Structure and Analysis." For a free listing of other publications contact: The Economist Intelligence Unit, 215 Park Avenue South (15th floor). New York, NY 10003. Tel. (212) 460-0671; Fax: (212) 995- 8837.

Dun's Marketing Services—Provides a source of publications about international marketing, exporting, and foreign corporations and companies. Dun & Bradstreet International's "Exporters' Encyclopedia" includes information on export shipping documentation, export market profiles, financing, laws and regulations, communications, and transportation. Other publications available from Dun & Bradstreet include "Principal International Businesses," "1984 Export Documentation Handbook," "Export Made Easy," and "Who Owns Whom" (identifies parent companies, their subsidiaries, and associates). Contact: The Dun & Bradstreet Corporation, 2700 South Quincy Street, Suite 250, Arlington, VA 22206. Tel. (703) 824-8383.

TRADEC—Offers a range of domestic and international trade promotion and marketing services. TRADEC tailors its services on an industry sector or individual firm basis. Marketing research, language translation, export and import marketing strategies, and sales contracts are some of the services offered to small- and medium-sized businesses in the international market. TRADEC has been successful in opening new markets for Pacific Northwest exporters in Europe, the Pacific Rim, and Latin America. For further information contact TRADEC, 910 Fifth Avenue, Seattle, WA 98104. Tel. (206) 447-0359.

The Business International Corporation (BIC)—Monitors and analyzes international Investment and trade. Reporting on 75 countries, BIC provides macro and microecon- omic data, information on political developments, socioeconomic trends, managerial, functional, and operational techniques. BIC's publications include "Financing Foreign Operations" (offers detailed country information), "Investing, Licensing, and Trading Conditions Abroad," and weekly "Business" newsletters covering international management/trade, international business updates, and trade outlooks for Europe, Latin America, Eastern Europe, Asia, and China. A weekly "Money Report" is also available which provides information on export financing, financial risk, and trends in exchange rates. Contact: BIC, 215 Park Avenue South, New York, NY 10003. Tel. (212) 460- 0600; Cable: "BUSYMAG NEW YORK"; Telex: 175 567.

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USDA Export Programs

Cooperator Program

American Hardboard Association

The Foreign Agricultural Service export market development program is carried out in cooperation with some 50 agriculturally oriented, nonprofit commodity associations known as foreign market development cooperators. Agreements between the cooperator and FAS authorize the cooperator, in partnership with FAS, to conduct overseas promotional activities. Cooperator projects are designed to acquaint potential foreign customers with U.S. agricultural products, to show how they might be used, and to create or stimulate demand. The Forest Products Division of FAS administers the program for solid wood products. FAS has a cooperative agreement with the National Forest Products Association (NFPA) to develop foreign markets for U.S. solid wood products. The NFPA has the responsibility for coordinating all of the export market development programs being undertaken with FAS. In turn, NFPA member trade associations conduct market development activities in cooperation with FAS. Jointly financed export promotional activities include advertising, merchandising, trade servicing, training and educational programs, seminars, demonstrations, international trade exhibits, and trade missions to and from the United States. This program is not available to individual companies.

For more information on cooperator associations, contact the U.S. Agricultural Export Development Council, 600 Maryland Avenue, SW., Suite 510, Washington, DC 20024. Tel. (202) 554-9538.

The activities of the principal associations participating in the Cooperator Program for solid wood products are summarized in the following sections.

The American Hardboard Association (AHA) is the national trade organization of manufacturers of hardboard products used for exterior siding, interior wall paneling, household and commercial furniture, and industrial and commercial products. AHA administers a quality conformance program for hardboard siding. Participation in the program is voluntary. It is open to members and nonmembers of the Association. AHA programs to promote increased use and consumption of hardboard products as well as to assist industry members, product users, and the general public include:

American Hardwood Export Council

Standards/specifications Environmental affairs Government relations Education Research and publications

For further information contact AHA, 520 N. Hicks Road, Palatine, IL 60067. Tel. (312) 934-8800; Fax: (312) 934-8803.

The American Hardwood Export Council (AHEC), formerly known as the Hardwood Export Trade Council, was created to serve the global demand for American hardwood products. AHEC, an umbrella association comprising the major U.S. hardwood product associations and hardwood exporting companies, maintains offices in Asia and Europe. These offices provide market intelligence, participation in trade fairs, technical assistance, and other trade servicing activities. AHEC services that support exporting include:

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• Market development programs • Technical information and seminars • American marketing and manufacturing systems • Promotional assistance • Market intelligence • Trade missions, fairs, and exhibitions • Trade barrier reduction • Overseas offices • Source list of supplies for retailers and consumers • AHEC membership directory

For further information contact AHEC, 1250 Connecticut Avenue NW., Suite 200, Washington, DC 20036. Tel. (202) 463-2720; Fax: (202) 463-2785.

American Plywood Association

The American Plywood Association (APA), founded in 1933, represents structural panel producers who manufacture approximately 80 percent of the structural panels made in the United States. APA represents 50 member companies who are located throughout the United States. The APA provides a variety of services for its membership. The objectives of these services are to:

Increase product demand through domestic and international product promotion and marketing. Maintain product quality through a rigorous quality inspection and testing program. Research and develop new panel applications and construction systems.

American Walnut Manufacturers Association

The American Walnut Manufacturers Association (AWMA) is a national trade group representing manufacturers of walnut lumber, gunstock blanks, and dimension. AWMA participates in trade fairs and other activities as a member of the American Hardwood Export Council. For further information contact AWMA, 5603 Raymond Street, Suite 0, Indianapolis, IN 46241. Tel. (317) 244-3311; Fax: (317) 244-3386.

Appalachian Hardwood Manufacturers Association

Appalachian Hardwood (AHMA) is a trade association of 177 members. Its members are mainly sawmillers in a 12-state Appalachian mountain region from north Georgia to southern New York. Associate members are distributors, consumers, suppliers, and producers of fine Appalachian hardwoods.

Although AHMA is interested in all the issues that impact the forest products industries, it is primarily concerned with promotion of the product. Promotion efforts include projects with cabinet producers, molding and millwork manufacturers, flooring and architectural woodwork manufacturers, and furniture producers. AHMA is active in education and information distribution through slide shows, seminars on hardwoods, and printed material. International promotion and marketing efforts are done as a member of the American Hardwood Export Council. AHMA participates in trade fairs in Europe and Asia and benefits from trade advertising by the council in major wood- consuming nations around the world. For further information contact AHMA, P.O. Box 427, High Point, NC 27261. Tel. (919) 885-8315 or (919) 885-4410.

Fine Hardwood Veneer Association

Fine Hardwood Veneer Association (FHVA) is the international trade association representing the decorative veneer industry. Membership is open to face veneer manufacturers, dealers, veneer custom cutters, rotary face and crossband manufactur-

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Hardwood Plywood Manufacturers Association

ers, hardwood industry suppliers, veneer salesman, and veneer face plants. In addition, contributors are welcomed for forestry and trade promotion. FHVA is a member of AHEC. For further information contact FHVA, 5603 Raymond Street, Suite 0, Indian- apolis, IN 46241. Tel. (317) 244-3386.

Pre-finishers of hardwood plywood, manufacturers of hardwood plywood and veneer, and suppliers to these industries are the groups that the Hardwood Plywood Manufac- turers (HPMA) represents as an international trade association. HPMA is a member of AHEC. HPMA has programs that are designed to support the interest of its members and to advance the use of hardwood plywood and veneer. Some of the programs are:

• Industry promotion—a member listing of manufacturers that includes sales, contacts, sizes, species, and speciality items Exhibits; trade opportunities program with the U.S. Department of Commerce Technical and laboratory facilities and services Standards Government representation Regional meetings

For further information contact the HPMA, P.O. Box 2789, Reston, VA 22090-2789. Tel. 703-435-2900.

National Dimension Manufacturers Association

National Dimension Manufacturers Association (NDMA) changed its name in 1985 from the Hardwood Dimension Manufacturers Association to reflect its growing membership base. NDMA currently represents more than 80 dimension manufacturers located in Canada and the United States. NDMA provides its membership with:

• U.S. trade show exhibitions • International promotional activities • Industry research and market studies • Seminars and meetings for members • Publications (newsletter and books) • Government relations • Service as a business referral clearinghouse for members

NDMA is also a member of AHEC. For further information contact NDMA, 1000 Johnson Ferry Road, Suite A-130, Marietta, GA 30068. Tel. (404) 564-6660.

National Forest Products Association

The National Forest Products Association (NFPA) is the umbrella association for the forest product industry. The NFPA works in conjunction with FAS to increase exports of American wood products. NFPA provides many services for its membership such as:

Government relations Market development Industry research and market studies Trade seminars Economics and information

For further information contact NFPA, 1250 Connecticut Avenue, NW., Washington, DC 20036. Tel. (202) 463-2724.

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National Hardwood Lumber Association

The National Hardwood Lumber Association (NHLA) is a nonprofit trade association composed of 1,200 member firms which produce, sell, and use hardwood lumber. The grading rules that NHLA developed for hardwood lumber are used by the United States, Canada, and to a certain extent, the world when trading in hardwood lumber. NHLA provides these services for members:

• Inspection school to train graders from all over the world • Continuing education—inspection short courses, seminars, and training programs • Hardwood promotion—consumer awareness and public relations • Export development—publishes monthly export newsletter and rules in a variety of

languages • Membership directory and annual report • Hardwood research • Annual convention

For further information contact NHLA, P.O. Box 34518, Memphis, TN 38184-0518. Tel. (901) 377-1818; Fax (901) 382-6419.

National Particleboard Association

The National Particleboard Association (NPA) is the trade association for the particleboard and medium density fiberboard (MDF) industry. Since NPA was established in 1960, it has been recognized by the Congress, Government agencies and non- govermental organizations as the spokesman for the particleboard and medium density fiberboard industries. NPA's 18 members represent over 80 percent of the U.S. manufacturing capacity for particleboard and MDF.

NPA carries out a broad education program aimed at furniture, cabinet, and woodworking customers to assist them in the use of particleboard and MDF. The NPA also provides coordination for standards development, and acts as a clearing house for industry statistics.

NPA actively promotes the increased use of particleboard and MDF through its promotional programs. While many of its members are actively involved in exporting their products, NPA does not provide direct export assistance and advice.

For further information on services and publications provided by NPA, contact NPA, 19828 Premiere Court, Gaithersburg, MD 20879. Tel. (301) 670-0604; Fax: (301) 840- 1252.

Northeastern Loggers Association, Inc.

The Northeastern Loggers Association (NELA) has approximately 2,500 members. It is a trade association that covers the area from Maine to Minnesota and south to Mary- land and Missouri. NELA publishes The Northern Logger and Timber Processor, a monthly magazine that covers the industry in that same area. NELA also sponsors the Northeastern Loggers Congress and Equipment Expo each year, promotes the export of American hardwoods, and publishes a directory of its members interested in exporting to world markets. NELA is a member of AHEC. For further information contact NELA, P.O. Box 69, Old Forge, NY 13420-0069. Tel. (315) 369-3078; Fax: (315) 369- 3736.

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Southeastern Lumber Manufacturers Association

Southeastern Lumber Manufacturers Association (SLMA) is comprised of 365 inde- pendently owned lumber manufacturers in 13 southern states producing in excess of 3.7 billion board feet of southern and Appalachian hardwoods and cypress lumber. SLMA exhibits at foreign lumber and furniture trade shows. The Association publishes lumber export directories in German, Italian, and Japanese. The Association invites inquiries from foreign buyers of southern pine, the various species of hardwoods, and cypress lumber. SLMA is a member of AHEC. For further information contact SLMA, P.O. Box 1788, Forest Park, GA 30051-1788. Tel. (404) 361-1445; Fax: (404) 361- 5963.

Southern Forest Products Association

Southern Forest Products Association (SFPA) is a nonprofit trade association of southern pine lumber manufacturers from the states of Virginia, North Carolina, South Carolina, Georgia, Florida, Tennessee, Alabama, Mississippi, Louisiana, Arkansas, Texas, and Oklahoma. SFPA has regional marketing managers in the South, East, and Midwest; a European marketing manager in London, and a Caribbean manager in Santo Domingo, Dominican Republic. A new office is opening in Italy to cover the Middle East. SFPA provides its membership with:

• Marketing (expansion and opening new markets for southern pine) • Public relations and advertising • Seminars for SFPA members and people in the building industry • Government affairs lobbying • Environmental issues • Publications (newsletters and books)

For further information contact SFPA, P.O. Box 52468, New Orleans, LA 70512. Tel. (504) 443-4464.

Western Wood Products Association

Western Wood Products Association (WWPA) is a nonprofit trade association that represents lumber manufacturers in the 12 western states, from the Canadian border south to Mexico and from the West Coast to the Black Hills of South Dakota. It represents an industry that produced almost 22 billion board feet of lumber in 1988.

WWPA plays a dual role in helping the western lumber distribution system serve Its markets by providing its members with:

• Engineering research related to design values • 14 professional field representatives and 29 lumber inspectors across the United

States • Promotions in export markets abroad with advertising, publicity, merchandising aids,

seminars, technical literature and training videos

Targeted Export Assistance Program (TEA)

For further information contact WWPA, Yeon Building - 4th floor, 522 SW. 5th Avenue, Portland, OR 97204. Tel. (503) 224-3930.

The Targeted Export Assistance Program (TEA) helps U.S. producers finance promotional activities for U.S. agricultural products disadvantaged by unfair foreign trade practices. The TEA program gives first consideration to agricultural products which have received a favorable decision under section 301 of the Trade Act of 1974 or whose exports have been adversely affected by retaliatory actions related to a favorable Section 301 decision.

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Under the TEA program, surplus stocks or funds from the Commodity Credit Corpora- tion (CCC) are used to partially reimburse agricultural organizations conducting specific foreign market development projects for eligible commodities in specified countries. TEA funds have gone to NFPA and APA who are the industry representatives. Proposals for TEA programs are developed by the two trade organizations and submitted to USDA by a deadline.

After a program has been approved and announced by USDA, participating organizations or firms sign a program agreement with the CCC. The TEA participants then submit activity plans to FAS describing specific activities and proposed budgets, which are partially reimbursable with CCC funds or certificates. Certificates can be redeemed for commodities from the CCC inventory or sold.

FAS may approve requests for advances of CCC resources not to exceed 40 percent of the dollar amount approved by FAS in an organization's activity plan. The advance must be fully disbursed within 90 days of receipt. No certificates are issued to reimburse expenses until the organization submits expense claims sufficient to offset any outstanding advance.

Activities financed by the programs vary from commodity to commodity. For example, a program to promote exports of U.S. wood products to Japan financed the construction of a three-story, wood demonstration building featuring advanced timber technology. The demonstration unit provided the focal point for a promotional and technical program.

Associations participating in the fiscal 1990 market development cooperator program are:

National

Forest Products Association

Hardwood Products (Managed by the American Hardwood Export Council)

Appalachian Hardwood Manufacturers, Inc. Fine Hardwoods/American Walnut Association Hardwood Manufacturers Association Hardwood Plywood Manufacturers Association Lake States Lumber Association National Dimension Manufacturers Association National Hardwood Lumber Association Northeastern Loggers Association Southeastern Lumber Manufacturers Association

Softwood Products American Plywood Association Southern Forest Products Association Western Wood Products Association

Otiier Wood Products American Hardboard Association American Institute of Timber Construction

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Export Credit Guarantee Program (GSM-102)

GSM-102 Programs for Forest Products

National Particleboard Association Wood Molding & Millwork Association

The Export Credit Guarantee (GSM-102) program, administered by FAS, is designed to facilitate financing for foreign purchases. Credit terms are generally from 180 days to 720 days for wood products. With each transaction, the foreign buyer's bank must issue an irrevocable letter of credit covering the port value (f.o.b./f.a.s. value) or, in some cases, cost and freight (c. & f. value) of the commodity exported. The U.S. exporter pays a fee and receives a payment guarantee from the CCC that will cover most of the amount owed to the U.S. bank in case the foreign bank defaults. The fee rate is equivalent to approximately one-third of 1 percent per annum on the outstanding coverage.

Usually, the exporter will assign the proceeds which may become payable under the payment guarantee to the U.S. bank financing the export sale. Thus, the foreign buyer may purchase commodities on deferred payment terms, and the exporter may never- theless receive payment immediately after shipment. The U.S. bank financing the sale is protected by the CCC's guarantee in the event the foreign bank defaults under a letter of credit or related obligation. By transferring the risk of loss from U.S. exporters and U.S. financing to the CCC, the program helps to facilitate exports and permits exporters to meet competition from other countries.

The GSM-102 program is intended for cases where credit is necessary to increase or maintain U.S. exports to a foreign market and where private financial institutions would be unwilling to provide financing without the CCC's guarantee. The GSM-102 program is not designed to displace normal commercial transactions that would have occurred in the absence of the program. The program is directed toward countries where the guarantees are necessary to secure financing of the exports and where the destination country has the financial strength to provide a reasonable expectation that foreign exchange will be available to make payments as scheduled. The CCC reviews requests on a case-by-case basis, and does not publish an eligible commodity or country list. Any U.S. agricultural commodity whose export furthers the CCC's long-range market development objectives may be considered. For additional information about the GSM-102 program contact the Director, the CCC Operations Division, Export Credits, Room 4503-S, Foreign Agricultural Service, USDA, Washington, DC 20250. Tel.(202)447-6211.

Regarding forest products, the GSM-102 program has been very successful in Ja- maica, Iraq, Algeria, South Korea, and Mexico. The CCC credit guarantee program was first used in Jamaica in FY 1981. Exports of solid wood products to Jamaica increased from $3.2 million in 1979 to over $9 million in 1989. Sales of wood products under GSM-102 to Iraq went from almost nothing to $124 million in FY 1988—this included $54 million of lumber, including $3 million of cants, $21 million of panel products, and $46 million of wood pulp. In 1989, $161 million worth was sold to Iraq— $98 million in lumber, $20 million of panel products, and $43 million of wood pulp.

Also, the GSM-102 program was utilized to finance the first U.S. lumber exports to Algeria—$20 million in FY 1988 and $29 million of lumber plus $20 million of wood pulp in FY 1989. In FY 1988 there were other smaller new sales to Turkey, Haiti, and

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Mexico as a result of this credit program. These sales to Mexico totaled $64 million (all wood pulp) in FY 1988, were restricted to $28 million in FY 1989, and are planned at $50 million in FY 1990 ($25 million lumber and $25 million wood pulp). South Korea has taken about $10 million in wood products in FY 1988 and FY 1989, and $10 million has been planned for FY 1990. All of this has been for lumber and veneer.

The GSM-102 program has opened up markets which previously were totally domi- nated by Scandinavian, Canadian, West European, and Soviet Bloc exporters.

Public Law 480 (Title I) Title I of Public Law 480 (P.L. 480) provides for U.S. Government financing of sales of U.S. agricultural commodities to friendly countries on concessional credit terms. Sales are made by private business firms, usually on a bid basis in response to tenders (invitations for bids or "IFB's") issued in the United States by the importing country.

Eligibility of Commodity Suppliers

The Food Security Act of 1985 (1985 Farm Bill, Public Law 99-198) authorized the Local Currency Initiative (section 108) under the authority of title I of P.L. 480 to generate economic growth through the private sector in recipient countries. U.S. commodity suppliers receive payment in U.S. dollars regardless of the type of P.L. 480 agreement signed.

Commodities programmed in recent years include wheat, corn, grain sorghum, rice, vegetable oil, cotton, wood products, tallow, beans, wheat flour, and blended fortified foods. Through the end of 1989, only one country (Jamaica) received wood products under the P.L. 480, title I program. This program was developed after Hurricane Gilbert devastated the island in September 1988. Another title I wood products program was negotiated with Costa Rica for FY 1990, and several more of these programs are expected to be developed in FY 1990 and beyond.

U.S. commodity suppliers interested in selling commodities under P.L. 480, title I must submit the following information to USDA, which will determine their eligibility:

• A current financial statement of the person or firm wishing to become eligible, as evidence of financial responsibility.

• A statement containing general background information about the firm, with particular reference to the firm's experience as an exporter of U.S. agricultural commodities, and any other information relating to whether the person or firm is a responsible party and able to perform the obligations of the P.L. 480 regulations and the purchase authorization.

• A statement, to be maintained on a current basis, listing the name, address, and chief executive officers for all branches, affiliates, subsidiaries, and associated companies, both foreign and domestic, in which the supplier has a controlling interest. This statement must also furnish the same information for any companies which have a controlling interest in the supplier, either directly or through subsidiaries.

Suppliers of wood products should submit statements to P.L. 480 Operations Division, Foreign Agricultural Service, U.S. Department of Agriculture, Washington, DC 20250- 1000.

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USDA reserves the right to permit a person or firm to act as a supplier only on submission of acceptable performance security, in the form of a letter of credit, which will assure that the supplier will perform the obligations of the P.L. 480, title I financing regulations and the purchase authorization. For further information about P.L. 480 programs, contact the Director, P.L. 480 Operations Division, Export Credits, Room 4079-S., Foreign Agricultural Service, USDA, Washington, DC 20250-1000. Tel. (202) 447-4274.

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Major Markets

Introduction The market summaries give a brief overview of the top export markets, examining marketing channels, practices, major end-uses for specific products, and recent developments in each market.

Small and nontraditional export markets such as the Caribbean, Africa, or South America may provide better opportunities, if your firm can provide the type of wood products needed at a profitable price.

Export markets for "specialty products," including items such as barrel staves and pencil slats, are extensive and varied. The best opportunities for foreign sales of these products may be in nontraditional U.S. solid wood markets. For example, in 1988 the largest export market for pencil slats was West Germany. However, Mexico was No. 2, and combined exports to Venezuela and Egypt exceeded U.S. exports of this product to West Germany.

An examination of other U.S. wood products exports provides insight into the diversity of U.S. markets overseas. In 1988, the Bahamas was the No. 1 importer of dowel rods ($1.1 million). The top four markets for casks, both new and used, were Venezuela, India, Japan, and Canada. Such items as coopers products, casks, and pencil slats are the types of commodities that succeed in nontraditional markets. Successful exporters will search for the niche that will give them an edge in the marketplace.

Success in exporting is a function of the ability of the company to be flexible and responsive to changes in consumer demand and the willingness to investigate new opportunities. Most important is the commitment by the U.S. exporter to studying and servicing the foreign market to assure that export marketing becomes a vital aspect of planning and profitability for the business.

The top U.S. markets and the leading products exported on a value basis for 1988 are shown in table 4; figures 1 and 2 graphically show distribution of U.S. overseas markets and wood products exported in 1989.

Information on foreign tariff and nontariff barriers, an important consideration in pricing products and preparing shipments for export, is in table 5. The reader may also contact the National Forest Products Association for information on this subject by referring to page 36 for the address.

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Table 4 — Value of U.S. exports of solid wood products by principal countries, 1989 ($000)

West Product Japan Canada S. Korea U.K. Mex Germany China Taiwan Italy

SW Logs 1,598,963 74,761 254,861 751 1,152 378 174,200 24,986 1,472 HW Logs 50,128 17,638 17,219 3,251 3,722 46,831 355 25,395 18,489 Poles,Piles, & Post 128 12,400 5 4 1,104 18 0 112 0 Wood Chips 353,033 1,241 11,441 71 7,414 5 0 14,504 0 SW Lumber 559,645 161,587 11,258 28,068 98,868 21,879 359 5,381 99,949 HW Lumber 133,414 115,555 11,988 55,678 27,022 37,107 148 58,994 37,292 Flooring 7,118 7,630 477 2,642 614 227 37 526 112 Siding 920 6,259 0 2 59 0 0 43 74 Molding 1,280 22,147 0 290 819 0 0 7 102 Treated Lumber 1,140 2,720 39 11 103 20 69 41 117 Railroad Ties 0 15,520 0 51 97 207 3,600 75 0 HW Veneer 10,770 4,737 10,435 11,211 1,821 60,611 1,020 11,704 7,462 SW Veneer 6,586 7,804 36 109 528 577 10 74 316 HW Plywood 374 28,882 171 493 6,619 623 2 166 75 SW Plywood 3,699 20,894 350 87,438 4,843 19,817 0 61 8,428 Hardboard 141 20,234 3,424 2,378 1,325 104 12 3,559 22 Particleboard 3,595 20,149 4,285 288 16,511 31 40 11,232 44 Mise Panel Products^ 32,951 35,744 15,111 6,788 4,923 2,289 608 18,384 235 Mise Wood Products' - 77,831 88,001 12,903 33,808 46,593 17,711 1,259 5,582 4,527 Total 2,841,697 645,265 354,001 233,332 224,135 208,435 181,719 180,828 178,716

Note: Totals may not add due to rounding.

includes such panel products as insulation board, and laminated boards.

^Such products as wood waste, pulpwood, building components, containers, and small industrial and household woodenware.

Source: Official statistics of the U.S. Department of Commerce.

44

Table 4 — Value of U.S. exports of solid wood products by principal countries, 1989 ($000)—Continued

Total Product Spain Belgium Iraq Neth. Algeria Denmark Jamaica Other World

SW Logs 1,786 0 0 68 0 0 41 2,133,930 2,146,155

HW Logs 5,072 8,245 0 1,124 0 179 8 198,764 227,473

Poles, Piles, & Post 10 0 0 10 0 0 2,098 15,960 25,464

Wood Chips 0 0 0 0 0 0 0 388,024 388,154

SW Lumber 61,610 10,234 53,375 4,818 36,316 1,683 11,508 1,265,361 1,391,171

HW Lumber 28,590 42,783 0 18,055 0 2,791 488 572,413 644,593

Flooring 363 14 0 184 0 0 95 20,190 22,200

Siding 0 0 0 12 0 0 20 7,389 7,880

Molding 1,058 4 0 0 0 0 5 26,378 27,072

Treated Lumber 22 0 0 36 0 0 1,455 5,794 13,012

Railroad Ties 0 0 0 0 0 0 772 21,558 10,407

HW Veneer 3,433 3,434 0 473 0 931 180 128,250 157,294

SW Veneer 4 151 0 0 0 0 88 16,482 14,874

HW Plywood 122 859 0 11 0 0 1,412 39,877 24,156

SW Plywood 274 33,560 2,055 21,796 0 25,308 939 231,721 267,892

Hardboard 434 237 0 105 0 383 90 32,637 39,710

Particleboard 4 49 1,242 241 0 171 238 58,868 63,612

Miso Panel Products^ 530 802 0 538 0 460 2,282 122,693 170,033

Mise Wood Products^ 4,439 2,920 106 3,743 294 1,067 10,851 317,537 389,247

Total 107,752 103,291 56,787 51,214 36,609 33,019 32,571 5,585,577 6,030,398

Note: Totals may not add due to rounding.

Încludes such panel products as insulation board, and laminated

boards. Încludes such products as wood waste, pulpwood, building components, containers, and small industrial and household woodenware.

Source: Official statistics of the U.S. Department of Commerce.

45

U.S. Wood Export Markets 1989

$ Thousand F.A.S. Value

Canada 10.7%

South Korea 5.9%

Mexico 3.7%

Japan 47.1%

Total Other 10.2%

-China 3.0%

-Taiwan 3.0%

-European Community 16.4%

Source: U.S. Department of Commerce

Value of U.S. Wood Products by Commodity 7989

$ Thousand F.A.S. Value

HW Plywood 0.4%

Wood Chips 4.2%

Railroad Ties 0.2%

HW Logs 3.9%

Hardboard 0.7%

SW Plywood 4.6%

Panel Products 2.9%

Misc. Wood Products 6.7%

Veneer 3.0%

Particleboard 1.1%

SW Logs 36.9%

Siding 0.1%

HW Lumber ll.io/o

Molding 0.5%

SW Lumber 23.9%


46

Table 5 — Selected Tariffs Applied to Imports From the United States

Item/Country

Logs jCo n if ero LJ s Japan ^,,^,......,,,^,,,,,,,^ Carrada ^..,..,^.,,^,.,,.^

CNna...... ...^,.. ..^v,^. -- European Community South Korea .,,.^ Taiwan .. Australia,

Nonconiferous Japaii .^,,^.,..,,_.,,. Can ad a ,.^,...... .^,,,, China.. ■ - •_■ A-• • ■ : • • • • • ■ • European Community..^... South Korea ■■^,::^- Taiwan .,,^,,, .^^...... Australia

Lumber Coniferous

Japar^,^. Canada China.... European CorpnnuriitY South Korea Taiiwan ..^...^....^.....^^^^^ Australia

Nonconiferous Japan Canada China .....^...^^^^ EuropeanCommunity South Korea Taiwan Australia,

Tariff Rate

1989 Percent

Free Free 3 Free 1.5 Free Free

Free Free 25 Free 3^1 Free Free

8 Free (untreated)-6.8 (treated)^

XÎZ_"Z^-"- Free-4.9

ASZZ Free 15

Free Free (untreatedl-6^8_(treated^^^ 9 '"""'""" 2, Free-4.9 20 2.5 15

Wood continuously shaped, along any of its edges Coniferous

Japan ....^ L--i-• i-• • ■ i^:• ■-- Canada ...^.......^^... China _ ..^.. European Community .._. South Korea ^.,.,,. -

TaiWajl^..............,,^...,..,...:..,^^.^■ • •

Australia....................^...v......vvv.v------

Continued page 48

7.2 Free (untreated)- 6.8 (treated)^ 40 „_ 3 20 Free

ll5 .

47

Table 5 — Selected Tariffs Applied to Imports From the United States- Continued

Item/Country Tariff Rate

1989 Percent

Nonconiferous Japan .^ Canada China.... European Conimunity ûth Konea^...^....^...^. Taiwan Australia,

12 Free- 4Ö7 3 Î5 Free 15

i5,5:oak)2

Veneer Cpnifefous

Japan Canada ..^................... China European Community South Korea

5 Free 30 0-6 15

Taiwan Australia..^..

Nonconifej'ous Japan Canada China...^,...................^.^ European Community South Korea ........^...... Taiwan .........^............. Australia

Free

b^Z Free 20 0-6 15 Free 5 ~

Plywood Coniferous

Canada ^. China.... European Communi^^^^^^^^ South Korea^.^.^......... Taiwan...^.........^.....^..^ AjustraHa ....^.^^^^^^^^^

Nonconiferous

Canada China European Community. South Korea Taiwan Australia

10 15 2 ~ Ï2-T7 iO 20 7.5-^5 25

Ï2.5" 87{9.2 8 10 Ï5 ' 25 25

surface covered)^

Continued on page 49

48

Table 5. Selected Tariffs Applied to Imports From the United States—Continued

Item/Country Tariff Rate

1989

Partlcleboard Japan 12

Canada China 30

European Community 10_

Soutln Korea 15 Taiwan 3.75

Australia __^ 20 FIberboard

Japan 3^ Canada 6.5^

China 30

European Community 1_0_

South Korea 20

Taiwan 3.75

Australia 20

Note: EC imports of softwood plywood are eligible for duty-free treatment on the first 650,000 cubic meters entered during the

calendar year.

^ 5 years reduction until free of duty on January 1, 1993 ^10 years reduction until free of duty on January 1, 1998.

49

^^P^" • J^Pan is the world's largest importer of forest products and the largest solid wood export market for the United States, with shipments totaling $2.8 billion in 1989, representing 47 percent of all U.S. wood product exports.

• Nonresidential and residential construction and home improvements, paper and pulp, furniture industry, and do-it-yourself and material handling products are the major uses of wood. Approximately three-quarters of the lumber consumed in Japan is used for construction, of which 60 percent is utilized in residential construction.

• In 1988, 66 percent of total Japanese roundwood consumption (67 million cubic meters) was sawn into lumber, 18 percent went to pulp and chips, and 16 percent was processed into plywood. The supply of domestic logs in 1988 equaled 31 million cubic meters. Domestic softwood logs, approximately two-thirds of the total log supply, are used primarily in construction. Seventy-five percent of domestic hardwood logs are processed into chips and pulp.

• "Ordinary" plywood is used for general purposes, concrete forming, or structural applications. Major end-users include construction, furniture cabinets for electrical equipment, decoration in exhibits, pallets, and sewing-machine tables. Plywood is classified by species (face-veneer basis), type (bonding strength), classes (surface defects), dimension, and end-use. There are four types of ordinary plywood: Special and Types 1, 2, and 3, ranked in decreasing order of the water resistance of the bonds. Japanese Agricultural Standard (JAS) specifications for plywood based on end- use include concrete-form, structural, fire-retardant (interior), slow-burning (for stage and exhibition halls), fire door, scaffolding, and pallet.

• "Special" plywood (mostly Lauan) includes panels with a sliced, natural wood face, overlaid with polyester, melamine, or polyvinyl-chlohde resin, or with printed wood grains, patterns, or coatings. Special plywood is specified by the degree of bonding, moisture content, and the finishing quality of the sides and butt ends.

• Wood product quality specifications are classified according to the JAS. These product standards are required in instances of Government-financed housing and in all Government-financed 2x4 platform housing. On July 26, 1989, the Ministry of Agriculture, Forestry, and Fisheries (MAFF) officially designated the American Plywood Association (APA) as a foreign testing organization under the auspices of JAS. This designation will allow APA to speed up the approval process for member mills which wish to become JAS-approved plants. Lumber is classified as boards, strips, or squares; and special class (for resawing), first class, or second class, according to surface quality.

• Long-term market opportunities in Japan for wood products are encouraging, particularly for both hardwood and softwood—lumber, plywood, veneer, and panels. Japan's imports from the United States have increased by nearly 120 percent from 1984 to 1988. As domestic production costs increase and tariffs decrease, more and more processed wood products are imported.

• Japan's wood products sector demand is dependent to a large extent on domestic housing starts. Although housing starts increased annually from 1984 to 1988, they were expected to decrease in 1989 due largely to soaring land prices in urban areas. It is not sure yet how severe the effect of the 3-percent consumption tax, effective April 1, 1989, will be on future starts. Even though the average size of a wooden home has increased, the percentage of wooden homes has decreased from 70 to about 40

50

percent over the last few decades. Non-wooden housing construction uses plywood for concrete forming. High material costs, extremely high land prices, a shortage of skilled labor, and more restrictive building codes are the cause for the decline in wooden housing construction. Housing surveys have shown that the Japanese still prefer wooden housing but are restricted by these obstacles.

• Demand for lumber and plywood have followed the trend of housing starts. Three- quarters of all lumber and 55 percent of all plywood is used in building construction. Domestic production of wood products has slowed due to a tighter supply of logs, especially from the Asian markets, and higher domestic production costs. Demand has been met by an increase in imports. Log imports are not, however, expected to pass their 1988 peak. Increasing lumber imports are primarily from the United States, while the increasing hardwood plywood demand is being met by Indonesia.

• The number of domestic plywood plants has been decreasing under the 5-year revitalization plan, initiated in March 1986. In order to reduce plywood tariffs of 15-20 percent, the Finance Ministry agreed to fund a Forest Agency revitalization program. Revitalization of the forest industry is primarily focused on the plywood sector as the plan entails closing inefficient mills, modernizing some existing mills, and building new state-of-the-art mills. Domestic production supplied 80 percent of the domestic consumption in 1988, down from 88 percent in 1987. Ninety-five percent of the plywood consumed is tropical hardwood plywood produced domestically from Luan logs originating in Malaysia. Plywood normally used in housing are panels measuring 3 X 6, rather than the 4 x 8 panels produced in the United States. Acceptance of U.S. 4 x 8 panels is slow but growing. One market that has been opening for U.S. products is 2 X 4 platform housing.

• Japanese particleboard consumption is centered in the furniture industry. The particleboard industry in Japan is faced with a dwindling supply of raw materials as more wood waste is being used for fuel. Additionally, competitively priced plywood has affected the demand for particleboard in the furniture industry.

• Demand for wood chips, both hardwood and softwood, has grown in Japan due to a strong demand for paper and related products. Also, one of the largest suppliers, Australia, has decreased its export of chips because logging has been restricted and chips are being processed into pulp before being exported. With the strong yen in 1987 and 1988, imported wood chips were cheaper than those produced domestically. Imports of wood chips equaled 12.8 million metric tons in 1988 compared to a domestic consumption of 21.3 million metric tons. The major suppliers are the United States, Australia, Canada, New Zealand, South Africa, and the USSR.

• Major U.S. hardwood species in demand include white and red oak, red alder, cherry, ash, and paulownia. The Japanese are interested in hardwoods exhibiting uniform color, fine grain, and no defects. A trend towards solid wood furniture and increased use of U.S. hardwoods in Japanese flooring should benefit U.S. producers.

• Japan has been identified by the United States as a Super 301 priority country, partly due to its wood product barriers. This action is provided for under the Omnibus Trade Bill Act of 1987. U.S. industry's Super 301 submission targets the identification and elimination of all barriers to trade in processed wood products. The bilateral negotiation process, involving both the private and the governmental sector, is already underway. An interagency task force has been established to support these efforts. The trade barriers discussed include tariff escalation for processed wood products,

5t

Value of U.S. Exports to Japan by Commodity 7985-7989

($000)

3,000,000

2,500,000

2,000,000

1,500,000

1,000,000

500,000

•

..••* ..••

•

..•*' /

• -■'■■'■" ^^-^

' ^^^^^^^„.^

1 1 1 1 1

1985 1986 1987 1988 Years

SW Logs SW Lumber Total


1989

52

European Community

United Kingdom

building codes, and technical standards. The laminated veneer lumber tariff misclassification issue is listed as a priority item.

• Import distribution channels—The Japanese distribution system for wood products is complex as business relations are built upon tradition, service, loyalty, personal relationships, and financing by suppliers for customer purchases. Purchases are financed by a promissory note system to large distributors who then resort and sell the products in smaller lots to smaller distributors. Wood products may pass through many distributors before finally reaching the wholesaler. At each stage, the intermediate buyer also maintains inventory and may provide other services to customers. The distribution system is slowly simplifying as regional banks are beginning to provide letters of credit to smaller buyers.

• Japan has been one of the main focus points of U.S. market promotion. TEA projects include the Summit House and Seattle Village. The Summit House, opened in May 1986, is a 5,400-square-foot, three-story building erected by the U.S. wood industry. As a direct result of this activity, the Ministry of Construction revised the national building code to include three-story, wood-frame construction. Although the building has now been turned over to the Japanese, it is still used to conduct seminars for architects, engineers, and builders. Seattle Village, now in the final stages of construction, is a 13-unit model home project in Kobe. The project has special promotional significance as it provides a major case history for a new Japanese "4 x 8 Construction Guide" so that Japan's Government Housing Loan Corporation will be able to approve loans for 4 x 8 construction. Other marketing activities include trade show participation, trade missions, trade servicing, and various seminars.

• The European Community (EC) of 12 nations is, collectively, the second largest export market for the U.S. wood product industry. In 1989, the United States exported $987 million of such products to the EC. Exports consist primarily of lumber and other processed wood products. The top five markets for U.S. wood products in the EC are the United Kingdom, West Germany, Italy, Belgium/Luxembourg, and Spain.

• The EC seeks to eliminate many of the tariff and nontariff trade barriers among the member states and create a single internal market of 320 million consumers by 1992. The EC Internal Market Program involves the adoption of 279 new regulations and policies, two of which target solid wood products: 1) the Plant Health Directive, and 2) the Directive on Construction Materials. These directives establish minimum standards to which all member states must comply. However, member states may establish more stringent regulations. The U.S. industry is concerned that standards which had previously applied to only one EC member may now apply as the minimum standard for all member states.

• The United Kingdom is the largest market for U.S. wood products within the EC, accounting for 23 percent of U.S. exports to the EC. Hardwood lumber and softwood plywood are the most popular of the U.S. products, each comprising one-third of U.S. wood exports to the United Kingdom. Since the United Kingdom is only 8-percent self sufficient, there is a strong growth potential for U.S. wood.

• The U.S. market share in temperate hardwood lumber in the U.K. market has risen substantially to 17 percent in 1988. This is primarily due to the impact of tropical forest conservation issues on manufacturers who are now more inclined to keep solid product lines (particularly in furniture) featuring temperate hardwoods. This trend is also opening new markets for lighter colored woods.

53

• The major temperate hardwood lumber species imported include red and white oak, elm, chestnut, and maple. Imported hardwood lumber must be square edged, kiln- dried, or fumigated to meet phytosanitary requirements. U.S. hardwood lumber accounts for 50 percent of such imports and 17 percent of the hardwood lumber consumed.

• The United Kingdom does not allow the import of U.S. oak logs as a phytosanitary precaution against oak wilt disease.

• The United States provides 46 percent of the U.K. demand for softwood plywood. It is used primarily in crating and concrete forming, and, to a lesser extent, in sheathing and home repairs. Extensive market development, being done by the U.S. industry in the latter two areas, is showing positive results.

• Sixty-seven percent of the softwood lumber imported originates in Sweden, Canada, and the USSR. The United States holds a marginal but growing market share. Only softwood lumber free from bark is permitted to enter the United Kingdom. The bulk of softwood lumber is used for construction, but there is increased interest in joinery (millwork) grades.

• Opportunities for southern pine lumber include molding, skirting, boards, and kitchen furniture. Lumber discoloration problems may occur because of warm and damp shipping conditions. Each piece of lumber must be grade marked.

• The British Standard (BS-5268) Code of Practice covering the structural use of timber provides additional market opportunities for U.S. softwood lumber. The standard allows machine-stress grading to the two visual grades of general structural (GS) and special structural (SS)—designated MGS and MSS—and two special grades M50 and M75. Provision is made for the following North American grades structural joists and planks and light framing, select No. 1, No. 2, and No. 3; light framing (construction); standard, utility, and stud. Design stresses are provided for southern pine, western white woods, and Douglas-fir. For example, a southern pine No. 2 visual grade would fall into the SC-3 strength class and could be stamped as such. This is important because it not only makes U.S. products more marketable in the United Kingdom but also demonstrates the willingness of the United States to provide wood products consistent with British grades.

• The importing agent plays a dominant role in arranging and financing hardwood and softwood imports. An increase in softwood lumber merchants dealing directly with large foreign wood products corporations threatens the importer's position for these products. Turning to hardwoods, the diversity of temperate and tropical species in demand assures the agent specializing in these products a strong position in the distribution chain.

• FAS sponsors, through market development and intensive promotional programs, activities to increase market awareness of U.S. wood products. Programs include trade show participation, U.S. wood-specific technical seminars, and other promotional trade servicing activities. More elaborate promotions include building on-site exhibits of homes made completely of U.S. woods. Recently, the "Street of Dreams" contest for a home of U.S. woods was held to inspire U.K. consumers to design their own homes featuring U.S. wood. Of the five designs selected and built, one design was chosen as the best and the winners were awarded the construction of this house on a plot of their choice and a 2-week trip to the United States. FAS also maintains an agricultural trade office in London to assist U.S. industry in promotional activities.

54

West Germany • West Germany is the second largest market for U.S. wood products in the EC. The United States exported 21 percent of its EC-bound wood products to West Germany in 1989. Hardwood logs and veneers are the most popular U.S. wood products. West Germany imports approximately one-third of its temperate hardwood needs from the United States.

• West Germany is the largest foreign market for U.S. hardwood veneer and logs. The United States supplies approximately 50 percent of West Germany's import requirements for oak logs, lumber, and veneer. West German supplies of veneer quality oak logs are limited. Because domestically harvested roundwood is considered medium quality, high-grade logs and lumber are in demand for furniture and paneling. Oak, mostly lumber, is the most popular furniture wood, but opportunities exist for walnut and cherry lumber and veneer. There is also a trend towards lighter colored woods as the darker tropical species decline in popularity.

• West Germany, in accordance with EC phytosanitary standards, requires that all incoming U.S. oak logs be either fumigated (barked) or heat treated (debarked). U.S. barked white oak logs are exempted from these requirements between October 15 and April 30.

• Sales contracts for hardwoods are traditionally based on National Hardwood Lumber Association grading rules. Established U.S. exporters to this market sell "company" grades or products of a specific quality or size which is in demand.

• A special housing program for 30,000 homes for German-origin immigrants from East Bloc countries is giving additional impulse to the building market. Also an increase in home improvements has stimulated demand for lumber and wood flooring.

• Imported softwood lumber is used for door or window parts, molding, and paneling. Most of imported lumber shipments are "unsorted 5ths," R-list clears, and southern pine clears. Lumber is used as profile boards (9.5 -12.5 mm) and tongue-and-groove paneling (100 mm, 4" wide).

• The United States provides a negligible amount of West Germany's sawn softwood imports. The largest suppliers are Sweden, Finland, and the USSR. Of the small amount imported from the United States, importers prefer softwood sales contracts based on the Gulf Coast Classification (1923) and the old Southern Pine Inspection Bureau grading rules (1977).

• The West German wood product industry consists mainly of small- to medium-sized companies. Brokers and agents play key roles in the distribution of wood products because individual end-users do not often purchase full container loads. Fifty to 60 percent of U.S. softwood products are imported via brokers. Brokers play a lesser role in purchasing hardwood logs. Agents generally receive a 3- to 5-percent commission on an f.o.b. price basis.

• As in most of Europe, the West German wood trade prefers to establish long-term business relationships with exporters. Importers seek quality products and reliable delivery schedules and may pay a premium for wood products of a particular origin or type.

55

• FAS sponsors, through market development and intensive promotional programs, activities to increase market awareness of U.S. wood products. Programs include trade show participation, U.S. wood-specific technical seminars, and other promotional and trade servicing activities. FAS also maintains an agricultural trade office in West Germany to assist U.S. industry in promotion activities.

• Italy is the third largest market for U.S. wood products in the EC. The United States exports 18 percent of its EC-bound wood products to Italy where imports provide 80 percent of the domestic requirements.

Italy • Italy depends entirely on imports for softwood lumber, of which the United States enjoys 6 percent of the market share. Austria provides 59 percent, mostly attributable to the quotations in European currencies, delayed payment, and capability to purchase partial shipments.

• Given the strength of the Italian furniture industry and diminishing suppliers of tropical hardwoods, Italy looks to the United States as an increasing supplier of temperate hardwood lumber, veneer, and plywood.

• The Italian furniture industry imports a wide range of hardwood species. Hardwoods are by far the most popular furniture wood in Italy. Despite the low quality of its product and the increasing unavailability of older stands, Yugoslavia remains the major supplier to Italy because of its low prices and willingness to quote in Italian lire. As supplies of tropical hardwood decrease, U.S. yellow poplar enjoys increasing popularity with the furniture and veneer industry as does alder.

• Italy, in accordance with EC phytosanitary standards, requires that all incoming U.S. oak logs be either fumigated or heat treated.

• Although Italian construction is traditionally based on concrete and masonry, wood use in residential construction is applied to roof trusses, usually spaced 24" to 32" on center. Most flat roofs consist of concrete slabs or poured concrete. Plywood or metal concrete forms are placed on 2" x 6" framing lumber spaced 32"-36" on center. Wood is also used for scaffolding to facilitate construction and renovations of the units.

• Joinery manufacturers are the major consumers of Douglas-fir and hemlock. R-list clears are popular in sizes ranging from 2 1/2" x 6" to 12" x 12." R-list clears are a set of grades developed by the Pacific Lumber Inspection Bureau and represent the most common grades of Douglas-fir and hemlock exported from the west coast of the United States. Merchantable grades may be more economical than R-list for the foreign manufacturer depending on the dimension of clear lumber required.

• Italy still faces a softwood plywood quota, as dictated by the EC. As with other EC members, excess above the quota face a 10-percent tariff.

• The wood distribution system is similar to that of other European countries. Agents perform the purchasing functions for the importers (the major wholesaling group).

• FAS marketing funds are used for a variety of promotional and trade servicing activities, including the publication and distribution of Italian technical manuals on the use of softwood species.

Belgium and * Belgium and Luxembourg comprise the fourth largest market for U.S. wood Luxembourg products in the EC. The United States exports 10 percent of its EC-bound wood

56

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SST

Value of U.S. Exports to the EC by Commodity 7985-7989

($000) 1,200,000

1,000,000

800,000

600,000

400,000

200,000

1985 1986 1987 1988 1989 Years

SW Lumber HW Lumber SW Plywood Total


58

• The utilization of softwood lumber by the building industry, for which demand is growing, is primarily for concrete forming. Timber-frame housing is only an emerging trend. FAS market development efforts, such as technical seminars and coordination of trade servicing by agricultural attaches and cooperators stationed in Madrid, are successfully increasing consumer awareness.

• Spain, in accordance with EC phytosanitary standards, requires that all incoming U.S. oak logs be either fumigated or heat treated.

• Since hardwood veneers and lumber are already processed and meet phytosanitary requirements, U.S. exports of these products have increased. Currently, the United States holds a 50-percent market share in oak. France is Spain's largest supplier of all temperate hardwood lumber, holding a 40-percent market share, compared to the U.S. share of 10 percent.

• The surge in construction has also increased the demand for plywood. Spain is emerging as a considerable market for U.S. softwood plywood in residential construction, concrete forming, packaging, and agricultural applications. Poplar accounts for much of Spain's production of temperate plywoods. Most poplar plywood is cut into strips used for packaging. Cherry and birch plywoods are used for furniture.

• Spain looks to the United States and New Zealand as main suppliers for hardboard, one of the many panel products gaining popularity in construction.

• Commercial representation, in the form of agents and importers, is a requirement in Spain to facilitate trade. Required documents include: 1) commercial invoice; 2) certificate of origin; 3) bill of lading; and 4) U.S. Shipper Report Declaration.

• FAS funds, through market development and promotional programs, activities to increase market awareness of U.S. wood products. Programs include trade show participation, U.S. wood-specific technical seminars, and other various trade servicing and promotional activities. TEA funds have been awarded to APA to participate in the 1992 World's Fair in Seville, by building a 50,000-square-foot pavilion.

Canada • Canada is both a natural market and competitor for the United States in international wood products trade. Canada is the leading supplier of U.S. wood and wood products imports, and our largest competitor in foreign softwood markets. Canada also is the second largest single export market for U.S. wood products.

• The United States suffers a wide trade gap with Canada in most of the major product groups, with the exception of logs and hardwood plywood.

• The Canadian forest products industry depends heavily on the level of construction activity and softwood lumber demand in the United States. Approximately 28 percent of U.S. softwood lumber consumption in 1988 was met by Canadian imports. These shipments totaled almost 14 billion board feet and accounted for 81 percent of Canada's softwood lumber exports to the world.

• Canada is a major competitor for U.S. producers in Europe and Japan. The Canadians are dedicated to servicing export markets and allocating generous and efficient resources for the products requested. For example, in Japan, the Council of Forest Industries of British Columbia (COFI) maintains a staff of seven professional wood products specialists to serve that market. One product of intense competition is

59

of U^BqportsiD

wnußmui

iiSDK n9Bm 1I90B

uns. dff

softwood plywood. The Canadians use their unique product standards to position their softwood plywood as superior to that of the United States. As provisioned in the Free- Trade Agreement (FTA) between the United States and Canada, efforts are under way to remove the standards distinctions.

• Canada has consistently been the largest exporter of softwood lumber to Japan. In the past, the United States provided primarily softwood logs. To compete in the softwood lumber market, U.S. exporters will need to meet the standards requirements of the Japanese market. Competition between Canada and the United States for overseas market may increase productivity efficiencies in the global market.

• In Europe, Canada has a successful niche in the European softwood plywood market by positioning the product as superior to that of the United States by virtue of Canada's unique prescriptive standards that the United States does not comply with. A research program between the United States and Canada is working towards resolving this issue.

People's Republic of * ^^^ People's Republic of China is expected to offer one of the most promising long- China term export markets for U.S. wood product producers. Consumption is now estimated

at 350 million cubic meters per year. Imported wood products accounted for 9 percent of Chinese consumption in 1988 and is expected to increase in both share and quantity. Due to a tightening of the supply of foreign exchange, the Government announced a 40-percent cut in forest product imports in 1989. However, demand for wood products is growing as income levels increase, in spite of a slowdown in construction activities. The United States supplied 52 percent of the total roundwood imports in 1988. The USSR, Malaysia, Canada, and Chile are other major trading partners.

• Forests cover 13 percent of China's area, roughly equal to 9 billion cubic meters of total timber volume. The current plan is to increase the forested area to 30 million hectares by the year 2000. Domestic production of roundwood was 128,000 cubic meters in 1988. China continues to implement a major reforestation program. However, forests under this program are plagued by such problems as survival rates of 50 percent; low use of fertilizer and pesticides; acid rain; and illegal and indiscriminate cutting of the forests for high-priced logs and firewood.

• Although the major use of wood in China is in the construction industry. State policy discourages its use and, therefore, only limited quantities are used in construction. Wood products are usually used for doorways, windows, scaffolding, and some concrete forming. Wood use is greater in rural housing, where it may be used for poles for the roof and for doors. Other uses include mining timber, railroad ties, shipping containers, and firewood. In 1988, the Government banned the use of wood in construction, electric power, railroad, road and water transport, shaft mining, fuels, and the coffin industry. Except in specified areas, materials such as steel, iron, or plastic are to be substituted for wood.

• Softwood lumber is used primarily in construction, for windows, doors, and lintels. Wood use per home is highest in the rural communities, approximately 0.15 cubic meter per square meter of floor space, and lowest in urban centers at 0.02 cubic meter per square meter. The size of the average house in China is approximately 50-60 square meters in urban areas and from 100-120 square meters in the rural areas. Due to its competitive price, Canada is the primary supplier of the small quantity of lumber imported.

61

• There is great concern in China about improving wood utilization. The Ministry of Forestry has targeted a 15-percent annual growth in panel product production which is seen as a promising avenue for providing local employment and generating revenue for local use through exports. In order to increase production in this area, particleboard and fiberboard production lines have been imported. The Chinese are also encouraging joint venture operations. The small amounts of panel products imported are supplied by Indonesia, Malaysia, Thailand, the Philippines, the United States, and North Korea.

• Although there is an official ban on the use of wood for railroad ties, concrete ties cannot be used in some areas. About 40 percent of railroad ties are imported, almost exclusively from the United States. Imports are expected to increase modestly as the Government has planned to expand the existing rail system.

• Imports of wood products are expected to increase from approximately 10 million cubic meters in 1988 to 30 million cubic meters by the year 2000 due to increased demand and limited domestic forest resources. Most forest product imports are softwood logs. Logs are more attractive since Chinese labor costs are low and available foreign exchange is tight. Although imports of logs in 1988 surpassed the record set in 1985, imports are expected to slow down in the short term. The United States supplied 63 percent of 9 million cubic meters of softwood logs imported in 1988. Malaysia supplied over 80 percent of the 1 million cubic meters of tropical hardwood logs imported. Despite the price advantage of other sources, such as Soviet logs, the demand for U.S. logs will continue. Many mills in China are set up to handle the larger U.S. logs, which have a quality reputation. Most imports of U.S. logs are from the west coast due to the lower transportation costs. China is developing a furniture industry and is experimenting with U.S. hardwoods. In order for this market to expand, China needs more familiarity with U.S. hardwoods on how to saw and season them.

• The Chinese furniture industry is growing both domestically and in the export market. Panel products are primarily used for this industry. However, the Government is encouraging increased use of rattan, bamboo, and willow in such production. Emphasis also is being placed on using other materials, such as steel and aluminum.

• One of the major constraints to expanding U.S. exports to China is a lack of knowledge of Chinese products, standards, and end-uses. U.S. industry and Government officials have found that a significant increase in U.S. value-added wood products exports to China will occur only with a long-term commitment to learning how to service this growing market.

• Log and lumber procurement from foreign suppliers is handled by a number of agencies, ministries, and corporations in the Chinese Government. The principal buyer is the China National Native Produce and Animal By-products Import and Export Corporation (China Tuhsu) of the Ministry of Foreign Economic Relations Trade. China Tuhsu maintains a purchasing office in the United States at 1010 South 336th Street, Federal Way, Auburn, WA 98003. Tel. (206) 874-4051.

• Other major participants in the wood products purchasing and distribution chain include the China Timber Corporation, Ministry of Railroads, Ministry of Forestry, and the China National Light Industrial Products Import and Export Corporation (China Light). China Light is responsible for importing plywood and other panel products. Nearly 100 percent of the plywood imported originates in Southeast Asian countries.

62

Value of U.S. Exports to China by Commodity ($000) 1985-1989

500.000

450,000

400,000

350,000

300,000

250.000

200,000

150,000

100.000 4 1985 1989

SW Logs Total


63

• The Ministry of Railroads plays a significant role in the distribution chain for wood products. Wooden ties (made from Douglas-fir, pine, and some hardwoods) are used in trunk lines and switching yards. The ministry operates its own sawmills, builds homes for ministry employees, and is involved in other major construction projects.

• Promotional activities in China under the marketing plan include the publication of educational material in Chinese and seminars on concrete forming. Under the TEA program, the Chinese market is being researched with the possibility of the construction of a demonstration project.

South Korea • South Korea's demand for wood products is increasing with imports more than doubling in 1987 and 1988. Wood products are primarily used for construction, furniture, packing materials, and for the manufacture of musical instruments. Construction for the 1988 Olympics, an increase in housing starts, and booming musical instrument and container and packing materials industries were responsible for the significant rise in demand for wood products. The growing demand was met by increased imports as domestic production is limited. These upward trends in demand are expected to continue but at a slower rate. The Government is following an ambitious plan to build 2 million new houses by 1993 and 180,000 units of high-rise apartments by 1991.

• South Korea's forest resources (6.5 million hectares) are diminishing and the quality of wood is poor. The reforestation program, aimed at controlling erosion and landscape beautification, has employed faster growing species of trees that are not necessarily economical for the timber industry.

• South Korea imports logs to support a diverse plywood and lumber production industry. Domestic sawmills processed 6.6 million cubic meters of logs in 1988. The supply of hardwood logs has declined as some Southeast Asian countries, such as Indonesia and Malaysia, have restricted or banned the export of logs. Thus, South Korea is in the process of switching from Asian hardwood to U.S. softwood. Imports of softwood logs increased 70 percent, while tropical hardwood log imports rose only 15 percent in 1988. The main suppliers of logs are now Malaysia and the United States. U.S. exports of softwood logs to South Korea totaled $255 million in 1989, consisting primarily of Douglas-fir, hemlock, and spruce. Imports of southern yellow pine and ponderosa pine are prohibited because of pine nematode.

• South Korea is no longer a major exporter of plywood for several economic reasons. The greater activity in various industries, such as construction (concrete forming), furniture, musical instruments, and packing materials, have resulted in a growing demand for plywood. With rising domestic wages, a lower tariff rate for plywood, and thinner, cheaper plywood produced in Indonesia and Malaysia, this demand is met increasingly with imports. Because of its low price, tropical hardwood plywood accounts for 98 percent of plywood imports. Logs for tropical hardwood plywood production are imported from Malaysia and Papua New Guinea. Temperate hardwood plywood is neither produced nor imported in Korea.

• South Korea produces no softwood plywood and imports small quantities from the United States, West Germany, and Japan. The increasing provision of technical information on U.S. softwood plywood and competitive prices should spur demand for this product.

• Particleboard and medium density fiberboard (MDF) demand significantly increased in 1988 in response to a greatly expanded domestic and export furniture market. This

64

Value of U^ Eipofis lo S. Korea by

100,000

1989

SWLogs Total

Soun»: U.S. Oefartment of Cammen»

65

increase is expected to continue since domestic production capabilities are limited and wood chip supplies are decreasing. MDF is a relatively new product and is replacing particleboard and plywood for many applications. However, the strong demand from the furniture and electrical industries will ensure growing markets for both particleboard and MDF. The United States is the main supplier of these imported products due to lack of competition. Hardboard is produced by only one South Korean firm whose production is sufficient for domestic consumption.

• Growth in imports of processed wood products is expected due to the increasing log export restrictions in Southeast Asia and rising South Korean wages. Some South Korean plywood manufacturers have moved their processing facilities to Malaysia and Indonesia and more are expected to follow. Imports of lumber and panel products increased 141 percent in 1988. Imported softwood lumber (primarily spruce and cedar) is used mainly in the musical instrument industry. Hardwood lumber also is used in this industry as well as in the furniture industry. The United States is South Korea's largest supplier of softwood and temperate hardwood lumber, exporting Douglas-fir, hemlock, oak, walnut, and maple. Larger quantities of tropical hardwood lumber are supplied mostly by Malaysia and Indonesia.

• Recognizing the potential for U.S. wood product exports to South Korea, the National Forest Products Association is opening an office for an overseas representative in Seoul with 1990 TEA funds. The representative will establish a strong presence for U.S. wood products through a wide range of activities. The activities include initial studies of the South Korean wood products markets, technical seminars, establishment of a joint wood products committee, development of professional relationships, curricula development in architectural institutions, public relations, and translation of technical information to be distributed.

• Import distribution channels: Most sawmills rely on logs imported by specialized traders due to inexperience and lack of collateral. Imported logs are procured by several companies that maintain their own offices in the northwest United States and distribute to domestic sawmills. Inchon and Pusan are the major ports, accounting for more than 90 percent of total log imports. Consequently, sawmills are heavily concentrated in the Pusan and Inchon area.

Taiwan • Taiwan is the eight largest market for the United States with the potential to grow even further in the 1990's. After Malaysia, the United States is Taiwan's largest source of roundwood. Domestic roundwood production is now almost nonexistent since the logging ban on most species of softwoods. North America is viewed as the only reliable long-term source of wood, and its market share is expected to increase. Restrictions on log and lumber exports, coupled with a decreasing supply, have limited imports from the other major trading area. Southeast Asia.

• Wood production in Taiwan is declining for three major reasons: (1 ) a labor shortage; (2) increasing wages; and (3) a ban on logging of domestic softwood. As incomes rise, fewer people are willing to do mill work and those who do demand higher wages. Pressing environmental concern is said to have been the cause behind the logging ban of most softwoods and limiting the harvesting of hardwoods. In addition, rough terrain and small-scale operations make local production less price competitive.

• The Taiwan furniture industry, primarily for export, accounts for 31 percent of total wood use. The plywood industry comprises 25 percent, pulp 21 percent, construction 11 percent, and the rest fir. In the face of the production problems, Taiwan furniture

66

Value of U.S. Exports to Taiwan by Commodity 7985-7989

($000)

250,000

200,000

-

150,000

4 f\r\ f\f\f\

-

100,000

50,000

0 1 1 1 1 1

1985 1986 1987 1988 198 9 Years

HW Logs HW Lumber Total


67

maä ípilpowixDxdl irrrattusörnies mm mmÁm^ to Smulltesasít âmm wMsm ílaÉamr m píterntlííy I anraa itesss ©«p©nffiiNí®.. ¡Htaxmeocen, îttris inniipcaEliicarni miW tee ipmni^ll'y iîiifestt toy arm irmDrsase m tttne muiinirtiiœrr aîff fadtoniies pîtDxrfto ftiiJTTniilun© aniîii pœaiterr üjffi© (ofl ^^^ (cnmieiiinni©rirntïaDï^ ftiumrilliuir® irntÉiistliîy is irm HornigattBam, fiïïmïwi^în^ smm/ irwD \\smhmma opoirrtt ptrawUiiidfe toworaï ínnüdl-rrairnge mmä Itiij^hhoitdi Itacalllsy ©mnsuiinnisilJ ittenrns. Htue irnuliiuslliîy is ©sparrratltmg ite espßirrtt rnmarrtete m\ú lupdisälirnig pitortfe to mmate tjttann iüntiaras tslidienft. iÄllltaiJi^ ríímafm¡y fatítomies arr© rnmtnNíirnig to S(Q)UjMtiiesQs(t yîa, TaNooorm will oMliirniue to luê lUI.S. \)ooKnmils as itfô opnirrtt îïïmaîtels (Priiitedl SMte, Jlapen., BuinpB,, and ALUisitrailÊa:) are fenniiíiar vewíftn am«jl dternmamdl US.. ItnandbioKQXDxdl spedies.

* SsifcoKQXQxiJls arre luisedl irm tte conistadforii iirnaii^y. Oenmamidl ttnadi ítseem tlrra(dillii(Q]rmalll¡y irnn^ isjf dtorTTmesüirc suppliies vooâîiîA aê rmearrilf atepileteíl. Tite oornisílíriuidíi^ iimriliUJSIliTy iis sdiill ^xery adüNíe armdl Táimmw rririiarrmiáainlujireirs ^m^m alteaß% iheguim e;^^f)eiriinTnerntiiinig îtlItD US.. stoflltoQXQxdls. Urntottuirriat^lj^,, tttnef arre rnioltHarniiEerwM^ US.. sniEammiopalfíl^,, prnossessiimg irrmelteds,, graidles,, arrnd trade ser^rcB.. HoNoxeiêr,, tneârre eage^ pmmtsSm^ am íinninmernse rnmarrlkett copporttujiniiit^ tovr U.S.. siuppliietrs..

) flue dhnrTmesOic ptrodtuctiiKQitn) cestt iimoreasiirmg amd flne HarJü ireduKcedl to zemo tor ikiiinnitDer,, TaiNooorm iis ttumirnig rnmore amdl rnmere to pooessedl wütmü pmáml ¡irrmpoirrtls,, espedialll;y pairneli prodiuclls smäk as IMIOF..

• Wood pirodydis are dustbrjibxijiedl ttnroujiglhi llarge wMlesallerrs wto Wneim iresdil m smmalller ibtls to smmalllerr wMlesallerrs oir (diirreidtll!^ to eimdküseirs.. intnese ûdDollesalieirs wiiil trernnaiirn) ttne soujirnce off wood prodiuidls far Taiieami"s ffiumüjiire anid p^ff Kwod iimidijslörii^ m SoüÉteast Asiia.

• IMIatrfeelt proinmolüiorniall adtiiîiffiies iimi Tmmam win eipanid îin fie openuiimg off aim olioe far a U..S.. wood produjidts iirmdujisltiry rrepreseinitlattirœ wffiio wiüll seirviioe fiialt inniairfcelL. Forr eiainnplle,, flue offiioe îll ooirndiuKCt mniairlkelt e^lmaltJioirDs ainid gàm senrniiirDatrs ^ün edujcaltiioirDall irimalleiriiall taimsllal^ iiimto Täiwainiese.

• lim 11989„ ttne Miiddlle Easlleinm irimairketls aoooyimled far $124 miiiliiioim off US. wood prodiUKCt expoims. Aihriica took $79 miiiioim woirttn iiim 1989..

Ahica and the • The ooyimtbriies off ffne Miiddlle Easit aimd Affiriica dUer sigimüffücairntt poteimltiiall for US. wood ■fiddle East pirodycit pirodiuiceirs. Reall soocess iiim «is iregiioim off ttne woirild Ihas beeo oomered by

compelöllöirs ffiroinni Eoirope aimd «hie Soviielt Uimiioni. US.. ifModocems lladk Ikimowlledge off local ciuisïoinnis„ markellüimg techoiiqyes, œimsftnucttiioim inniettlhiods, aimd mairket oppoirtyoues. The poteotial far US. peoetratüoo io tthiis mairket is eocoyiragiog, partiicylairlly io sypplyiog materials for housong aimd nofiraslbnuictyre develoipmeot.

• During the past 5 years« the U.S. timber iodosîtry has begoo exportiog io Middle East and African markets with the help of USDA s GSM-102 credit guarantee program. This program makes U.S. goods as competitive as the European products. Iraq and Algeria are two success stories. Iraq's imports off U.S. wood products increased from $392,000 in 1983 to $57 million in 1989, making it one of the top 20 U.S. martlets. Algeria, only recentiy included in the program, imported $37 million in wood products in 1989.

• Many of the African nations are wood-producing competitors of the United States, but heavy deforestation and desertification are beginning to be felt in their timber

68

Value of U.S. Exports to the Middle East 1985-1989

($000)

140,000

120,000

100,000

80,000

60,000

40,000

20,000

-

-

-

/

/

/ /

~'>^ ■<-

I , l- u 1 1 .. 1985 1986 1987 1988

Years

SW Lumbar Misc. Wood Products Total


1989

69

Value of U.S. Exports to Africa by Commodity 1985-1989

($000) 80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

•

•

• /A \ /

• / .' \ \ /

// / \\ /

\ '■"■•

/ \,.

1 I Í— - 1 1 1985 1986 1987

Years 1988 1989

Misc. Wood Products Total

Source: U.S. Department ot Commerce

70

industries. There will be opportunities for the timber industry throughout Africa if knowledge of U.S. wood is promoted and if the credit guarantee programs are continued. Since the growing populations of these regions will be needing housing, educational seminars and trade missions covering this need could have a positive impact.

• Barter is a principal method of selling wood products in Africa. Countertrade (barter) has been used with other African countries, China, and East European nations.

• Marketing in some African and Middle Eastern countries involves direct negotiating and contracting with either the government or private individuals, but direct negotiating is the key. Exporters must develop ties with the importers. Personal contact is a key trade servicing feature in these countries.

• There are market opportunities with wood products that have not been fully explored in Africa. The products that are most sought after in this region are not always traditional products but those like pencil slats, staves, and casks. Africa is generally ignored as a market place, but with good market research and stronger economies some of these countries can be as profitable as European markets.

• End-users of wood products for furniture and construction do not know available types, sizes, and uses of U.S. hard and soft woods. In the Middle East these end- users may be coming from India and Pakistan where they have been working with lower quality hardwood.

• Restrictions to trade in these regions generally consist of tariff duties which can run as high as 70 percent.

• The U.S. forest products industry and FAS have begun to commit to long-term programs to develop some markets (for example, Algeria, Turkey, and Iraq) for lumber and plywood products. These types of programs, consisting of seminars, trade missions, and the like, will be necessary in Africa and the Middle East to counter the bias against wood housing. Education of professionals in timber technology and the quality and grade of U.S. woods can help U.S. exporters obtain a larger share of these developing markets. GSM-102 programs are currently available for Iraq, Algeria, Tunisia, and Morocco.

Oceania • Of the 27 island nations that make up the Oceania region, only 10 import wood products from the United States. Australia is the largest with New Zealand second ($2.4 million) and the Marshall Islands third ($1.7 million). Softwood lumber, softwood plywood, and miscellaneous wood products were the three top sellers in this market. Although lumber and plywood are the top products, the category of miscellaneous wood products—such as dimension and pencil slats—shows that they have the possibility of being top-selling items.

• Papua New Guinea (71 percent forest), Australia (14 percent forest), New Zealand (38 percent forest), Fiji (65 percent forest), and New Caledonia (51 percent forest) are all producers of wood products and, with the exceptions of Australia and New Zealand, import very little wood from the United States. However, this situation may not last long unless the approach to forest management is changed.

• The current restructuring of the New Zealand forest industry also may affect the timber industry of Oceania. During the summer of 1989, New Zealand put 500,000 hectares of forest lands up for sale, and has been in the process of restructuring the

71

Australia

Latín America

state-owned enterprises that controlled most of the forest land. New Zealand has had a good policy of replanting and has the potential to become a major international player in forest products. However, labor problems, high interest rates, uncertain wood quality, and poorly managed companies that have been protected by high tariffs may hinder future production if the current restructuring does not solve these problems.

• Australia is the 10th largest U.S. export market and the largest in Oceania. In 1989, the United States exported $116 million of forest products to this market.

• Australia's forest industry ownership is changing. Currently all expansion of new softwood plantations is a private sector initiative. Hardwood plantations have nearly doubled in the public sector with an eightfold increase in the private sector. These trends indicate the growing importance both sectors are placing on the development of domestic hardwood production and highlight the degree of confidence the private investor holds in the future of Australia's forest industry.

• Sawn timber maintains a strong position in the construction industry and that industry utilizes 40 percent of the sawn timber available in the market.

• Softwood structural lumber is becoming more popular for use in wall frames. Concrete slabs are preferred over timber flooring, and an increase in the use of flooring grade particleboard and plywood has cut into the "timber strip" flooring market.

• The demand for wood-based panel products has continued to increase, but local production has not kept pace. Most imports have traditionally come from Asia, so U.S. suppliers will face increased competition from Southeast Asian countries as their hardwood plywood productive capacity and export promotion efforts expand.

• U.S. exports of softwood lumber to Australia totaled $99 million in 1989, with most U.S. softwoods shipped as "rough."

• TEA funds are being utilized to promote U.S. hardwoods in Australia and several Southeast Asian countries. Proposed activities include technical seminars and machining demonstrations, design seminars, regional trade exhibitions/conferences, public relations campaigns, and distribution of promotional material.

• The Latin American region took 7 percent of U.S. exports of solid wood products in 1989, representing a 22-percent increase over 1988. Mexico is the largest U.S. market, accounting for about half of U.S. exports to this region. Jamaica, the Leeward Windward islands, the Bahamas, and the Dominican Republic account for an additional one-quarter of U.S. exports to the region.

• Softwood lumber, hardwood lumber, and softwood plywood are three of the top products exported to this region. The uses of these products vary. In Jamaica, for example, softwood lumber is primarily used for constructing roofing systems, while in Mexico its uses range from house building to furniture construction to concrete forming.

• Hardwood lumber is mostly used for decorative purposes in furniture and construction, and softwood plywood is often used for concrete forming and building houses.

72

Value of U.S. Exports to Auslud hf Conim^HÜf

«wwpi 140,000

120.000

100.000

80,000

60.000

40.000

20.000 1985 1986 1967

Years

Smr Lumbw- Total

1988 1989


73

• In some countries, such as Venezuela, lumber price hikes have encouraged furniture manufacturers to search for cheaper alternatives, such as plastic, aluminum, and less expensive wood types. Import restrictions, large debts, high inflation, and poor infrastructures for the transportation of resources are some of the reasons for the higher prices.

• The United States, Chile, Brazil, and Guatemala are some of the top sources of solid wood products for this region. Location, policies, prices, and preferences are some of the factors that make these import markets attractive.

• Latin America is a large undeveloped market for wood products. Due to preference and a general lack of knowledge about the use of wood in construction, this region is inclined to build with concrete and masonry materials. Historically, most markets hold a bias against wood and timber frame construction because of the effects of weathering and termites on untreated softwood lumber. In an effort to expand U.S. exports in this region, the U.S. industry has embarked on an aggressive market development and educational program which focuses on training carpenters and establishing wood- based demonstration homes.

• Some of the main target customers include furniture companies, the tourist industry, wood-product dealers, and highway construction companies. But many of these prospective importers lack knowledge and expertise to import U.S. products and need training and assistance. In some countries such as Jamaica, distribution is highly centralized with all imports being purchased by one authority—the Jamaican Commodity Trading Company. This company purchases lumber based on Government-controlled allocations which is then sold to distributors who, in turn, sell to retailers or directly to users.

• The most successful U.S. exporters in this region visit and service importers, builders, and lumber dealers frequently.

• The most common grade of southern pine marketed in the Caribbean islands is "#2 common & better."

• Most countries in this portion of the world have high population growth rates and are in great need of additional housing. Mexico, for example, has a chronic and growing housing shortage. It is estimated by Mexican Government housing agencies that Mexico has a current deficit of 6 million houses nationwide. Beginning in 1990, an estimated 1-1.3 million new houses will need to be constructed annually to meet minimal population requirements.

• The United States wood products industry is promoting U.S. timber frame construction for low-cost, affordable, and attractive housing in the region. The attributes of this type of construction are shorter construction cycles (compared to that for concrete and masonry), high insulative values, promotion of construction materials produced from renewable resources, and superior performance under adverse weather conditions. Such attributes should fit well into these markets. In addition, the potential for diversifying employment opportunities, through expansion of wood-based construction, is encouraging.

• As a direct result of the Inter-American Housing Conference, the Southern Forest Products Association (SFPA), and the American Plywood Association (APA) erected several low-income homes in Jamaica in the spring of 1986. These demonstration

74

homes were still intact after Hurricane Gilbert (1988), unlike many of the surrounding buildings. The favorable response to this development has created an opportunity in Jamaica for U.S. lumber and plywood producers to expand markets for home construction, in addition to resort and hotel construction. Similar projects have taken place in other parts of this region and have favorably influenced the use of wood construction. TEA funds will be used to research potential wood products markets in Mexico.

• The GSM-102 program has proven to be successful in aiding sales of wood products in Latin America. Both Mexico and Jamaica currently participate in this program, while some other countries in this region have unused GSM-102 credits available. Jamaica has primarily used these credits for softwood lumber, while Mexico has used them to purchase wood pulp. For FY 1990, Mexican participants are being encouraged to also use allotted GSM-102 credit for solid wood products.

• TEA funds are being utilized to promote U.S. wood products in several Latin American countries. For example, in the Dominican Republic SFPA and APA are working together on a promotional activity which involves the construction of a major tourist facility made of wood using U.S. wood frame building techniques. Complementing this construction project, seminars to educate Dominican architects, engineers, the building products trade, building code officials, and insurance and financial executives on the advantages of building with wood will be held and Dominican carpenters will be trained in modern, U.S. wood frame building techniques. TEA funds will be also used by SFPA, APA, and the American Hardwood Export Council to promote U.S. wood products in Mexico. Promotional plans include holding training seminars similar to the educational and training seminars planned in the Dominican Republic and the translation and distribution of appropriate publications on forest products.

• In FY 1989, the United States signed a first-time P.L. 480, Title I agreement with Jamaica to provide $5 million for the purchase of U.S. solid wood products. This transpired primarily because of the Hurricane Gilbert catastrophe.

• Programs such as these represent the commitment which the United States has to this growing market. However, tariffs of 20 percent on panel products, 15 percent on veneer, and 10 percent on finished lumber in Mexico, and other tariffs throughout the region, represent obstacles that deter the export of U.S. wood products.

75

Value of U^. andfhe

by

90OßBO

Exports to Lalin

4ßojaoo

300^000

200,000

100.000

0 JL JL JL JL 19B5 1986 1987 1988

Yeais 1989

SW LifiRilMr Wood Piroifeichi Totol

Soufiœ: U.S. Itepaitment of Cùmmerœ

76

APPENDIX I Selected Publications

Key Publications Keeping up to date on foreign and domestic economic developments and trends is on Exporting essential to marketing wood products overseas. A variety of major U.S. and foreign

daily and weekly newspapers and magazines provide information on economic conditions and trends. Listed below are a small sample of the types of publications available from private and Government sources.

1. Background Notes—Provides a survey of a nation's people, geography, economy, government, and foreign policy, trade information (imports and exports), official exchange rates, major trading partners, and the nation's membership in international organizations. Contact: U.S. Government Printing Office, Washington, DC 20402. Tel. (202) 783-3238.

2. The Commercial Bulletin—Weekly newsletter reporting on domestic and foreign markets for wool, leather, building materials (wood products), energy, and recycling trades. Contact: Curtis Guild & Co. Publishers, Inc., 89 Broad Street, Boston, MA 02110. Tel. (617)357-9450.

3. Foreign Economic Trends and Their Implications for the United States—Reports providing indepth review of business conditions and current and near-term outlook for U.S. exports and business opportunities in specific countries. Contact: U.S. Govern- ment Printing Office (address above).

4. Hardwood Market Report—Weekly reports on U.S. domestic hardwood lumber prices. Contact: HMR, 1418 Madison Avenue, P.O. Box 40042, Memphis, TN 38174- 0042. Tel. (901)726-1555.

5. Key Officers of Foreign Service Posts—Pocket-sized reference of key contacts in U.S. embassies and consulates around the world. Contact: Superintendent of Docu- ments, U.S. Government Printing Office (address above).

6. International Trade Report—A bimonthly newsletter of the National Forest Products Association (NFPA) on foreign market opportunities and worldwide issues and developments affecting U.S. wood products trade. Included are foreign market reviews, updates on U.S. trade policy initiatives, summaries of pending U.S. legislation affecting trade, references outlining export-related publications and information, and a listing of upcoming meetings, seminars, and foreign wood products trade shows.

7. Random Lengths Export Market Report—A biweekly report on world markets for forest products. Included are recent trends in U.S. wood products trade in major markets, price reports for selected products, and other domestic and foreign market information. Contact: Random Lengths Publications, Inc., P.O. Box 867, Eugene, OR 97440-0867. Tel. (503) 686-9925.

8. Timber Trades Journal & Wood Processing—A weekly U.K.-based magazine that provides information on U.K. wood products production, trade, and woodworking. International trade issues and recent developments are covered in the softwood and hardwood "Market Reports" and the "International News" section. The Timber Trades Journal also reports on trends in major European wood products markets and factors

77

affecting supplier nations. Contact: Benn Publications Ltd., Sovereign House, Sover- eign Way, Tonbridge, Kent, England. Tel. 0732 364422; Telex: 95132.

9. Trends in Trade: The United States in World Markets—Provides U.S. wood products trade data and information on U.S. wood consumption and world wood trade. A bibliography and glossary are also provided. Contact NFPA, International Trade Division, National Forest Products Association, 1619 Massachusetts Avenue, NW., Washington, DC 20036. Tel. (202) 797-5820; Telex: 140950 NFPADC.

10. The World Factbook, 1989—Produced annually by the Directorate of Intelligence of the Central Intelligence Agency. Provides statistical information on foreign countries including population, land area, nationalities, religion, languages, labor force, government, government leaders, political parties, GNP, major industries, imports, exports, and exchange rates. Contact: U.S. Government Printing Office (address above), Stock #:041-015-00157-4.

11. World Wood—Magazine issued bimonthly by Miller Freeman Publication, Inc. It includes articles on wood products industries and trade for all major wood markets and producing regions of the world.

"World Wood Review"—Annual report with summaries of wood products production, consumption, and trade by country for North America, Latin America, Europe, Africa, Asia, and Oceania. Contact: Miller Freeman Publications, Inc., Circulation Department, 500 Howard Street, San Francisco, CA 94105. Tel. (415) 397-1881 ; Telex: 278273.

12. UNIPUB—Source of forestry and forest products publications issued by 20 international organizations and publishers including the Food and Agricultural Organization (FAO), Organization for Economic Cooperation and Development (OECD), General Agreement on Tariffs and Trade (GATT), and the Tycooly International Publishing Company, Ltd. Contact: UNIPUB, 205 East 42nd Street, New York, NY 10017. Tel. (212)916-1650.

13. Foreign Agricultural Trade of the United States—A bimonthly statistical and analytical review of U.S. agricultural trade available by subscription ($19 per year U.S.; $23.75 foreign) from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402.

14. Ocean Liner Cargo Service Directory—A reference of available ocean liner cargo services. It is free from the Office of Transportation, Room 1405 Auditors Building, U.S. Department of Agriculture, Washington, DC 20250.

15. AgExporter—Magazine issued monthly by FAS which features articles and news items on market opportunities for U.S. agricultural products in foreign markets. Topics covered regularly include overseas markets and buying trends, new competitors and products, trade policy developments, and overseas promotional activities. It is available by subscription ($11 per year, U.S., $14, foreign) from the Foreign Agricultural Service, Information Division, Room 4642-S., Washington, DC 20250-1000.

78

The following publications are available from the Foreign Agricultural Service (FAS), Information Division, Room 5918-S, U.S. Department of Agriculture, Washington, DC

20250-1000. Tel. (202) 447-3448.

16. The U.S. Farmer's Export Arm describes the export services and programs of the Foreign Agricultural Service. (Free)

17. Partners in Trade Promotion provides a directory and description of the FAS market development cooperator program. (Free).

18. Agriculture's Emissaries Overseas is a directory and description of U.S. Agricul- tural counselor/attache offices overseas. (Free).

19. Food and Agricultural Export Directory lists export services and key contacts in the export business. (Free).

20. FAS Commodity Circulars are reports on production, trade, and other specialized export information for major commodity groups, including wood products, issued at regular intervals during the year. (Subscription fees) Write to the above address for an order blank.

21. Exporting - Small & Growing Business, Deloitte Haskins & Sells, Small Business Services Department, 114 Avenue of the Americas, New York, NY 10036.

22. Export Marketing for Small Firms, Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402.

23. Foreign Commerce Handbook, 17th Edition by Ann Dwyer Moffry, U.S. Chamber of Commerce, Washington, DC 20230.

24. Business America magazine provides information on overseas business opportunities, country profile summaries, and other useful articles on foreign trade, international business, and economics. It is available by subscription from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402.

25. Uniform Customs and Practices for Documentary Credits, United States Council of the International Chamber of Commerce, 1212 Avenue of the Americas, New York, NY

10036.

79

APPENDIX II Samples of Shipper's Export Declaration and Aphis Phytosanitary Certificate

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f0í»M7B2S-V n-^M» SHIPPER'S EXPORT DECLARATION OM0 Wo, 0607-0018

la. IXPOüTEfl (Nêm9 ënd Mddtêuê lñ<h»díng ZIP eodcl Lié LogRlng International

3 Route Spartanaburg» PA

b. tXf>0ñTEA'8 EIN UR8I NO.

97-0124609

ZIP CQOÍ 16434

a, PATI or EXPORTATION 4/1/89

«. PARTIES TO TRANSACTION

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252 South Ridge Road QueJ?§L<Lf_Canada_ . _

"VÎNtERMEDIATE COÑSlCKlft

475 Industrial Park Pittaburg, PA

É. LOADING PIER iVêMMtonlyi

10. EXPORTING CARRIER

Benâ Trucking 12. PORT Of UNLOAOINQ {Vêêêêi ênd êk onfyt

0, MODI Of TRANSPORT (Specify)

Truck 11. PORT OF EXPORT

Buffalo, NY It. CONTAINERIZED iVëtMclonlyf

Dvt. GNC

t, »iU OF UAQINQ/AIR WAVfilU. NO. B-00976

6. FOINTI8TATE) OF ORIGIN OR FTZ NO PA

7. COUNTRY OF ULTIMATl DESTINATION Canada

14. SCHEDULE B DESCRIPTION OF COMMOOlTtCS.

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APPENDIX III Samples of "Export Briefs," "Buyer Alert," and Foreign Importers Listing

85

These export opportunities for U.S. food & agriculturai products have been gathered by aoricultural and other U.S. government officers serving abroad. The USDA does not guarantee the reliability of the overseas inquirer. For further information, contact the foreign firm originating the inquiry.

United States Department of Agricultura


Products Sought by Foreign Buyers

August 13, 1990

FOREST PRODUCTS

LUMBER AND FOREST PRODUCTS (TAIWAN). WANTS HICKORY SAWN-TIMBERS/LUMBER. QUANITY: MINIMUM 5 CONTAINERS/SHIPMENT. QUALITY: NO. 1 COMMON AND BETTER; THICKNESS - 5/A", 6/4" PACKAGING AND DELIVERY: TO BE NEGOTIATED. QUOTE: CIF TAICHUNG, TAIWAN. BANK REF: THE CHANG HWA COMMERCIAL BANK, TAIPEI WORLD TRiDE CENTER BRANCH TAIWAN. CONTACT: MR. QUINCY S WU, GEN. MGR., OOF LONG CORPORATION, TAIPEI WORLD TRADE CENTER 4D16, 5 HSIN YI RD. SEC. 5, TAIPEI, TAIWAN. PHONE: 886-2725-1046. TELEX: 22654 FOREBOOM.

ROUNDWOOD (LOGS, PULP, POLES, PILING) (TAIWAN). WANTS HICKORY LOGS. QUANTITY: APPROXIMATELY 20,000 DOYLE FEET/SHIPMENT. QUALITY: HANDLE GRADE; 3SC AND BETTER, DIA 12"+, LENGTH 8'+. PACKAGINING AND DELIVERY: TO BE NEGOTIATED. QUOTE: C&F TAIWAN. BANK REF: THE CHANG HWA COMMERCIAL BANK, TAIPEI WORLD TRADE CENTER BRANCH, TAIPEI, CONTACT: MR. QUINCY S. WU, GEN. MGR., OOF LONG CORPORATION, TAIPEI WORLD TRADE CENTER 4D16 5 HSIN YI RD. SEC. 5, TAIPEI, TAIWAN. PHONE: 886-2725-1046. TELEX:22654 FOREBOOM.

LUMBER AND FOREST PRODUCTS (BELGIUM). WANTS OAK - RED AND WHITE, QUANTITY: UPPER GRADES 'PRIME' AND 'CLEARS'. QUALITY: UNLIMITED BY THE CONTAINERLOAD. PACKAGINING: CONTAINER. DELIVERY: ASAP AFTER PLACEMENT OF ORDER. OTHER: COMPANY WORKS AS AN AGENT AND HAS A MAJOR MARKET WITH MANUFACTURERS. QUOTE: CIF OR FOB. BANK REF: GENERALE BANK - KEERBERGEN. CONTACT: MR. ARDOULLIE, PAUL ARDOULLIE SPRL, D. LIEKENSLANN 21 A, B-2850 KEERBERGEN, BELGIUM. PHONE: 32 (15) 518065. TELEX: 65169. FAX: 32 (15) 518066.

LUMBER AND FOREST PRODUCTS (SPAIN). QUANTITY: BY CONTAINERLOADS. QUALITY: SOUTHERN YELLOW PINE AND DOUGLAS FIR. PACKAGING: BUNDLES. DELIVERRY: EIGHT TO TEN WEEKS. OTHER: COMPANY ACTS AS AGENT. QUOTE: CIF TENERRIFE/LAS PALMAS. BANK REF: BANCO DE SANTANDER - SAN FRANCISCO, 1 - 38001 SANTA CRUZ DE TENERIFE. CONTACT: MESSRS. MANUEL-FERNANDO, MANUEL DE LOS RIOS HERNANDEZ, GONZALEA COVIELLA, 1 - 2-DCHA, 38004 SANTA CRUZ DE TENERIFE, CANARY ISLANDS/SPAIN. PHONE: (22) 27-2287. FAX: (22) 22-4247.

Issued weekly by the Agricultural Information and Marketing Services, Foreign Agricultural Service, USDA, Room 4645-S, Washington, D.C., telephone (202) 447-7103.

86

The followina announcements and specifications are provided by U.S. commercial Firms. USDA does not endorse the products or guarantee the reliability of the firms. Importation of the products is subject to the regulations and label clearance procedures of your government.

For U.S. Agricultural Products

United States Department of Agriculture


Products Offered by U.S. Exporters

DECEMBER 1989

SAMPLE BUYER ALERT ANNOUNCEMENTS

HARDWOOD-- Appalachian and Southern. Red Oak, Red Elm, White Ash, Hackberry, and Poplar. Rough sawn, cut to size. Dimensioned. Kiln dried. FOB Port: Savannah, Georgia or New Orleans, Louisiana, For pricing information, please contact the firm. Seeking agents and distributors. Bank Reference: Southeast Bank N.A., Miami, Florida 33156. CONTACT: John Exporte?^, Lumber International, 123 Southeast 83rd Street, Mytown, State 45678. Phone: (001) 211-4444. Fax: (001) 211-4445.

DOUGLAS FIR— Green or KD, rough or S4S. No. 2 clear or better. FOB Port: Portland, Oregon, For pricing information, please contact the fi^m. Seeking agents and distributors. Bank Reference: Commerce Bank, 1900 Market Street., Philadelphia, Pennsylvania 19103. CONTACT: Harry Trader, I Export Inc., 456 East South Street, Anywhere, State 91011. Phone: (030) 112-3333. Fax: (030) 112-3334.

ELM-- Hard and soft. Packaging: export packed. FOB Port: New Orleans, Louisiana, For pricing information, please contact the firm. Seeking agents and distributors. Bank Refe?"ence: Commerce Bank, 1900 Market Street, Philadelphia, Pennsylvania 19103. CONTACT: Rodney Expórtese, American Wood Inc., 4545 Centers Rd. Anytown, State 12345, Phone: (321) 321-4231. Fax: 321-321-4322. Telex: 68687 WUAB

HARDWOOD LUMBER— Kiln Dried furniture grade. White Oak, Red Oak, Walnut, and Maple. Packaging: Bunks and Containers. FOB Plant: St. Louis, Missouri, Indicator Price: $1,000.00 to $1, 450.00 per thousand board foot. Seeking agents and distributors. Bank Reference: Southwest Bank, Kinshighway and Southwest Blvd., St. Louis, Missouri 63110. CONTACT: Joan Exporter, Exporter Associates Inc., P.O. Fax: (321) 321-4333.

Box 123, Anytown, State Telex: 86867 BUAW

12345. Phone: (321)321-4321.

Issued weekly by Agricultural Information and Marketing Services (AIMS), Foreign Agricultural Service, U.S. Department of Agriculture. For further information contact the Agricultural officer at the American Embassy or the Agricultural Trade Office.

87

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APPENDIX IV Adresses of State Foresters

ALABAMA State Forester Alabama Forestry

Commission 513 Madison Avenue Montgomery, AL 36130

ALASKA State Forester Division of Forestry 400 Willoughbury Avenue Juneau, AK 99801

ARIZONA State Forester State Land Department 1616 West Adams Phoenix, AZ 85007

ARKANSAS State Forester Arkansas Forestry

Commission P.O. Box 4523 Asher Station Little Rock, AR 72214

CALIFORNIA Director Department of Forestry Resources Building P.O. Box 94246 Sacramento, CA 94244-2460

COLORADO State Forester Colorado State Forest

Service 203 Forestry Building Colorado State University Fort Collins, CO 80523

CONNECTICUT State Forester Bureau of Forestry Dept. of Environ. Protection 165 Capitol Avenue Hartford, CT 06115

DELAWARE State Forester Department of Agriculture 2320 South Dupont

Highway Dover, DE 19901

FLORIDA Director Division of Forestry 3125 Conner Blvd. Tallahassee, FL 32399- 1650

GEORGIA Director Georgia Forestry

Commission P.O. Box 819 Macon,GA 31298-4599

GUAM Territorial Forester Forestry and Soil Resources Div. P.O. Box 2950 Agana, Guam 96910

HAWAII Administrator Division of Forestry and

Wildlife 1151 Punchbowl Street Honolulu, HI 96813

IDAHO Director Department of Lands State Capitol Building,

Rm. 121 Boise, ID 83720

ILLINOIS State Forester Division of Forest

Resources and Natural Heritage

Northwest Office Plaza 600 N. Grand Avenue,

West Springfield, IL 62706

INDIANA State Forester Division of Forestry 613 State Office Building Indianapolis, IN 46204

IOWA State Forester Iowa Department of Natural Resources Wallace State Office Building Des Moines, IA50319

KANSAS State and Extension Forester Department of Forestry 2610Clafin Road Manhattan, KS 66502

KENTUCKY Director Division of Forestry Natural Resources

and Environmental Protection Cabinet 627 Conamche Trail Frankfort, KY 40601

LOUISIANA Assistant Commissiioner Office of Forestry Depart of Agriculture P.O. Box 1628 Baton Rouge, LA 70821

MAINE State Forester Department of Conservation State House Station #2 Augusta, ME 04333

MARYLAND State Forester Forest, Park and Wildlife

Services Tawes State Office

Building 580 Taylor Avenue Annapolis, MD 21401

89

MASSACHUSETTS Chief Forester Division of Forests and

Parks 100 Cambridge Street Boston, MA 02202

MICHIGAN Chief and State Forester Forest Management

Division Michigan Department of

. Natural Resources Stevens T. Mason Building Box 30028 Lansing, MI 48909

MINNESOTA Director Division of Forestry 500 Lafayette Road St. Paul, MN 55155

MISSISSIPPI State Forester Mississippi Forestry

Commission Suite 300, 301 Building Jackson, MS 39201

MISSOURI State Forester Missouri Department of

Conservation 2901 West Truman Blvd. P.O. Box 180 Jefferson City, MO 65102

MONTANA State Forester Division of Forestry Department of State Lands 2705 Spurgin Road Missoula, MT 59801

NEBRASKA Head and State Forester Department of Forestry, Fisheries and Wildlife Plant Industries Building, Room 101 Lincoln, NE 68583

NEVADA State Forester Division of Forestry 201 South Fall Street Carson City, NV 89701

NEW HAMPSHIRE Director Division of Forests and

Lands 105 Loudon Road Concord, NH 03301

NEW JERSEY State Forester State Forestry Cn 404, 501 E. State

Street Station Plaza #5 Trenton, NJ 08625

NEW MEXICO State Forester Division of State Forestry P.O. Box 2167 Santa Fe, NM 87503

NEW YORK Director Division of Lands and

Forests Dept. of Environ.

Conservation 50 Wolf Road Albany, NY 12233

NORTH CAROLINA Director Division of Forest

Resources P.O. Box 27687 Raleigh, NC 27611-7687

NORTH DAKOTA State Forester North Dakota Forest

Service First and Brander Bottineu, ND 58318

OHIO State Forester Division of Forestry Fountain Square Columbus, OH 43224

OKLAHOMA Director Forestry Division Oklahoma State Dept. of

Agriculture 280 N. Lincoln Road Oklahoma City, OK 73105

OREGON State Forester Oregon Department of

Forestry 2600 State Street Salem, OR 97310

PENNSYLVANIA Director Bureau of Forestry P.O. Box 1467 I Harrisburg, PA 17120

PUERTO RICO State Forester Department of Natural

Resources P.O. Box 5887 Puerta de Tierra San Juan, PR 00906

RHODE ISLAND State Forester Division of Forest

Environment 1037 Hartford Pike North Scituate, Rl 02857

SOUTH CAROLINA State Forester South Carolina Forestry

Commission P.O. Box 21707 Columbia, SC 29221

90

SOUTH DAKOTA State Forester Division of Forestry 445 East Capitol Sigurd Anderson Building Pierre, SD 57501

TENNESSEE State Forester Tennessee Dept. of

Conservation Division of Forestry 701 Broadway Nashville, TN 37219-5237

TEXAS Director Texas Forest Service College Station, TX 77843-2136

UTAH State Forester Division of State Lands

and Forests 3 Tria Center, Suite 400 Salt Lake City, UT 84180-1204

VERMONT Director of Forests Dept. of Forests, Parks

and Recreation Agency of Environ.

Conservation 103 S. Main Street, 10 South Waterbury, VT 05676

VIRGIN ISLANDS Director Virgin Islands Forestry

Program King Field Post Office St. Croix, VI 00851

VIRGINIA State Forester Virginia Division of

Forestry P.O. Box 3758 Charlottesville, VA 22903

WASHINGTON Supervisor Department of Natural

Resources 201 John A. Cherberg

Building Mail Stop QW-21 Olympia, WA 98504

WEST VIRGINIA State Forester Department of Agriculture Forestry Division State Capitol Charleston, WV 25305

WISCONSIN Chief State Forester Department of Natural

Resources P.O. Box 7921 Madison, Wl 53707

WYOMING State Forester Wyoming State Forestry

Division 1100 West 22nd Street Cheyenne, WY 82002

NATIONAL ASSOCIATION OF STATE FORESTERS Washington

Representative 444 North Capitol Street Suite 526 Washington, DC 20000

91

APPENDIX V Sesk Offices of the International Trade Administration (ITA), U.S. Department of Commerce

The following is a listing of selected desk offices of the ITA, U.S. Department of Commerce. The area code for telephoning these desk offices long distance is 202. Letters should be addressed to the (Country) Desk Officer, U.S. Department of Com- merce, Herbert C. Hoover Building, Washington, DC 20230.

Country Telephone Country Telephone Country Telephone

Afghanistan 377-2954 Ghana 377-4388 Paraguay 377-1548 Algeria 377-4652 Greece 377-3945 People's Republic Argentina 377-1548 Grenada 377-2527 of China 377-3583 ASEAN 377-3875 Guatemal 377-2527 Peru 377-2521 Australia 377-3647 Guinea 377-4388 Philippines 377-3875 Austria 377-2920 Guinea-Bissau 377-4388 Poland 377-2645 Bahamas 377-2527 Guyana 377-2527 Portugal 377-3945 Bahrain 377-5545 Haiti 377-2527 Puerto Rico 377-2527 Bangladesh 377-2954 Honduras 377-2527 Romania 377-2645 Barbados 377-2527 Hong kong 377-2462 Rwanda 377-0357 Belgium 377-5401 Hungary 377-2645 Saudi Arabia 377-4652 Belize 377-2527 Iceland 377-3254 Seychelles 377-4564 Bermuda 377-2527 India 377-2954 Singapore 377-3875 Bolivia 377-2521 Indonesia 377-3875 South Africa 377-5148 Brazil 377-1744 Iran 377-5545 South Korea 377-4958 Brunei 377-0357 Iraq 377-5767 Spain 377-4508 Burkina Faso 377-4388 Ireland 377-4104 Sri Lanka 377-2954 Burma 377-5334 Israel 377-4652 Sudan 377-4564 Canada 377-3101 Italy 377-2177 Sweden 377-4414 Cape Verde 377-4388 Jamaica 377-2527 Switzerland 377-2920 Caymans 377-2527 Japan 377-4527 Syria 377-5767 Chile 377-1495 Jordan 377-5767 Taiwan 377-4957 Colombia 377-1659 Kenya 377-4564 Tanzania 377-4564 Costa Rica 377-2527 Kuwait 377-5767 Thailand 377-3875 Cuba 377-2527 Laos 377-2462 Trinidad & Cyprus 377-3945 Lebanon 377-5767 Tobago 377-2527 Czechoslovakia 377-2645 Libya 377-5737 Tunisia 377-4652 Denmark 377-3254 Luxembourg 377-5401 Turkey 377-3945 D'Jibouti 377-4564 Malaysia 377-3875 United Arab Dominican Malawi 377-5148 Emirates 377-5545

Republic 377-2527 Malta 377-3748 United Kingdom377-3748 Ecuador 377-4303 Mauritania 377-4388 USSR 377-4655 Egypt 377-4652 Mauritius 377-0357 Uruguay 377-1495 El Salvador 377-7527 Mexico 377-4464 Venezuela 377-1659 Ethiopia 377-4564 Morocco 377-5737 Virginia Islands European Economic Mozambique 377-5148 (U.K., U.S.) 377-2527

Community Nepal 377-2954 Yemen 377-4652 (EEC) 377-5276 Netherlands 377-5401 Yugoslavia 377-5373

Finland 377-3254 New Zealand 377-3647 Zaire 377-0357 France 377-8008 Nicaraqua 377-2527 French Guyana 377-2527 Norway 377-4414 Gabon 377-0357 Oceania 377-3646 Gambia 377-4388 Oman 377-5545 German Democratic Pacific Islands 377-2308

Republic 377-2645 Pakistan 377-2954 Germany (West 377-2434 Panama 377-2527

92

APPENDIX VI U.S. and Foreign Commercial Service District Offices

Northeastern Region I Mid-Atlantic Region II Appalachian Region III

Connecticut Hartford, 06103, Room610-B, Fed. BIdg. 450 Main St. (203) 204-3530

Maine Serviced by the Boston District Office

Massachusetts Boston, 02210, Suite 307, World Trade Center, Commomnwealth Pier Area (617)223-2312

New Hampshire Serviced by the Boston Office

New York Buffalo, 14202, 1312 Federal BIdg. 111 W. Huron St. (716)846-4191

New York, 10278, Rm. 3718, Federal BIdg. 26 Federal Plaza, Foley Sq. (212)264-0634

Delaware Serviced by the Philadelphia District Office

District of Columbia Serviced by the Baltimore District Office

Maryland Baltimore, 21202, 413 U.S. Customhouse, 40 South Gay St. (301)962-3560

New Jersey Trenton, 08608, Princeton Pike BIdg. #6, Suite 100 (609)989-2100

Pennsylvania King of Prussia Suite 202 Allendaalle Rd (215)962-4980

Pittsburg, 15222 2002 Fed. BIdg 1000 Liberty Avenue (412)644-2850

Rhode Island Serviced by the Boston District Office

Vermont Serviced by the Boston District Office

Kentucky Louisville, 40202, Rm. 636B, U.S. Post Office and Courthouse BIdg., 601 West Broadway (502) 582-5066

North Carolina Greensboro, 27402, 203 Federal BIdg. 324 W. Market St., P.O. Box 1950 (919)378-5345

South Carolina Columbia, 29201, Strom Thurmond Fed. BIdg., Suite 172, 1835 Assembly St. (803) 765-5345

Tennessee Nashville, 37219-1505, Suite 1114 Parkway Towers, 404 J.R. Parkway

Virginia Richmond, 23240, 8010 Federal BIdg. 400 N. 8th Street (804)771-2246

West Virginia Charleston, 25301, 3042 Federal BIdg. 500 Quarrier Street (304)347-5123

93

Southeastern Region IV Great Lakes Region V Plains Region VI

Alabama Birmingham, 35205, Suite 200-201, 908 S. 20th St. (205)254-1331

Florida Miami, 33130, Suite 224 Fed. BIdg., 51 S.W. First Ave. (305) 350-5267

Georgia Atlanta, 30309, Suite 504 Fed. BIdg., 1365 Peachtree St., N.E. (404)881-7000

Georgia Savannah, 31401, 27 East Bay P.O. Box 9746 (615)736-5161

Mississippi Jackson, 39213, Suite 3230, Woodrow Wilson Blvd. (601)960-4388

Puerto Rico San Juan, (Hato Rey), 00918, Room 659 Federal BIdg. Chardon Ave. (809) 753-4555 Ext. 555

llinois Chicago, 60603, Room 1406, Mid-Continental Plaza BIdg., 55 E. Monroe St. (312)353-4450

Indiana Indianapolis, 46204,

Suite 520 One North Capitol (317)226-6214

Michigan Detroit, 48226, 1140 McNamara BIdg., 477 Michigan Avenue (313)226-3650

Minnesota Minneapolis, 55401, 108 Federal BIdg. nos. 4th Street (612)348-1638

Ohio Cincinnati, 45202, 9504 Fed. BIdg., 550 Main St. (513)684-2944

Cleveland, 44114, Room 600, 666 Euclid Ave., (216)522-4750

Wisconsin Milwaukee, 53202 Room 606 Federal BIdg. 517 E. Wisconsin Ave. (414)291-3473

Iowa Des Moines, 50309 817 Fed. BIdg., 210 Walnut St. (515)284-4222

Kansas Serviced by the Kansas City, Missouri, District Office

Missouri Kansas City, 64106, Rm. 635, 601 E. 12th St. (816)426-3141

St. Louis, 63105, Forsyth Blvd. Suite 610 (314)425-3302

Nebraska Omaha, 68137, O Street (402)221-3664

North Dakota Serviced by the Omaha District Office

South Dakota Serviced by the Omaha District Office

94

Central Region VII Rocky Mt. Region VIII Pacific Region IX

Arkansas Little Rock, 72201, Suite 811 320 W. Capitol Ave. (501)378-5794

Louisiana New Orleans, 70130, 432 World Trade Center, 2 Canal St. (504) 589-6546

New Mexico Albuquerque, 87102, 517 Gold S.W. Suite 4303 (505) 766-2386

Oklahoma Oklahoma City, 73116,, 6601 Broadway Extension (405)231-5302

Texas Dallas, 75242, Room 7A5, 1100 Commerce St. (214)767-0542

Houston, 77002, 2625 Federal BIdg. Courthouse, 515 Rusk St. (713)229-2578

Arizona Phoenix, 85025, U.S. Courthouse Rm. 3412, 230 N. First Ave. (602)261-3285

Colorado Denver, 80202, Suite 600 1625 Broadway (303) 837-3246

Idaho Boise, 83720, 2nd floor Hall of Mirrors, 700 W. State St. (208) 334-3857

Montana Serviced by the Denver District Office

Nevada Reno, 89502, 1755 East Plumb Lane, Rm. 152 (702)784-5203

Utah Salt Lake City, 84101, Rm. 340 U.S. Courthouse, 350 S. Main St. (801)524-5116

Wyoming Serviced by Denver District Office

Alaska Anchorage, 99513, P.O. Box 32 701 C St. (907)271-5041

California Los Angeles, 90049, Rm. 800, 11777 San Vicente Blvd. (213)209-6707

San Francisco, 94102, Box 36013, 450 Golden Gate Ave. (415)556-5860

Hawaii Honolulu, 96850, 4106 Federal BIdg. 300 Ala Moana Blvd., P.O. Box 50026 (808) 546-8694

Oregon Portland, 97204, Room 618, 1220S.W. 3rd Ave. (503)221-3001

Washington Seattle, 98109, 706 Lake Union BIdg. 1700 Westlake Ave. North (206)442-5615

95

APPENDIX Vil Small Business Administration District Offices

ALABAMA 2121 8th Avenue North Suite 200 Birmingham, AL 35203-2398 (205)731-1344

ALASKA 222 West 8th Street #67 Anchorage, AK 99513-7559 (907)271-4022

ARIZONA 2005 North Central Ave. Fifth Floor Phoenix, AZ 85004 (602)261-3732

ARKANSAS 320 West Capitol Avenue Room 601 Little Rock, AR 72201 (501)378-5871

CALIFORNIA 2202 Monterey Street Suite 108 Fresno, CA 93721 (209)487-5189

350 S. Figueroa Street Sixth Floor Los Angeles, CA 90071 (213)894-2956

211 Main Street Fourth Floor San Francisco, CA 94105-1988 (415)974-0642

880 Front Street Room 4-S-29 San Diego, CA 92188 (619)557-5440

COLORADO 721 19th Street Room 407 Denver, CO 80202-2599 (303) 844-2607

CONNECTICUT 330 Main Street Second Floor Hartford, CT 06106 (203) 240-4700

DISTRICT OF COLUMBIA 1111 18th Street, N.W. Suite 108,6th Floor Washington, DC 20036 (202) 634-4950

FLORIDA 400 West Bay Street Room 261 Jacksonville, FL 32202 (904)791-3782

1320 South Dixie Highway Suite 501 r Coral Gables, FL 33146 (305) 536-5521

GEORGIA 1720 Peachtree Road, N.W. Sixth Floor Atlanta, GA 30309 (404) 347-2441

HAWAII 300 Ala Moana Room 2213 Honolulu, HI 96850 (808)541-2990

IDAHO 1020 Main Street Suite 290 Boise, ID 83702 (208)334-1696

ILLINOIS 219 S. Dearborn Street Room 437 Chicago, IL 60604-1779 (312)353-4528

IOWA 373 Collins Road, N.E. Room 100 Cedar Rapids, lA 52402-3118 (319)399-2571

210 Walnut Street Room 749 Des Moines, lA 50309

INDIANA 575 North Pennsylvania St. Room 578 Indianapolis, IN 46204- 1584 (317)269-7272

KANSAS 110 E. Waterman Street First Floor Wichita, KS 67202 (316)269-6571

KENTUCKY 600 Federal Place Room 188 Louisville, KY 40202 (502) 582-5976

LOUISIANA 1661 Canal Street Suite 2000 New Orleans, LA 73102 (504) 589-6685

MAINE 40 Western Avenue Room 512 Augusta, ME 04330 (207) 622-8378

MARYLAND 10 North Calvert Street Third Floor Baltimore, MD 21202 (301)962-4392

MASSACHUSETTS 10 Causeway Street Room 265 Boston, MA 02114 (617)565-5590

96

MICHIGAN 477 Michigan Avenue Room 515 Detroit, MI 48226 (313)226-6075

MINNESOTA 100 North 6th Street Suite 610 Minneapolis, MN 55403- 1563 (612)370-2324

MISSISSIPPI 100 West Capitol Street Suite 322 Jackson, MS 39269-0396 (601)965-4378

MISSOURI 1103 Grand Avenue Sixth Floor Kansas City, MO 64106 (816)374-3419

815 Olive Street Room 242 St. Louis, MO 63101 (314)425-6600

MONTANA 301 South Park Avenue Room 528 Helena, MT 59626 (406) 449-5381

NEBRASKA 11145 Mill Valley Road Second Floor Omaha, NE 68154 (402)221-4691

NEVADA 301 E. Stewar Street Room 301 Las Vegas, NV 89125 (702)388-661

NEW HAMPSHIRE 55 Pleasant Street Second Floor Concord, NH 03301-1257 (603)225-1400

NEW JERSEY 60 Park Place Fourth Floor Newark, NJ 07102

(201)645-2434

NEW MEXICO 5000 Marble Avenue, N.E. Room 320 Albuquerque, NM 87100 (505)262-6171

NEW YORK 26 Federal Plaza Room 3100 New York, NY 10278 (212)264-4355

100 South Clinton Street Room 1071 Syracuse, NY 13260 (315)423-5383

NORTH CAROLINA 222 South Church Street Room 300 Charlotte, NC 28202 (704) 371 -6563

NORTH DAKOTA 657 Second Avenue North Room 218 Fargo, ND 58108-3086 (701)239-5131

OHIO 1240 East 9th Street Room 317 Cleveland, OH 44199 (216)522-4180

85 Marconi Boulevard Room 512 Columbus, OH 43215 (614)469-6860

OKLAHOMA 200 Northwest 5th Street Room 670 Oklahoma City, OK 73102 (405)231-4301

OREGON 1220 Southwest 3rd Ave. Room 676 Portland, OR 97204-28824 (503)221-2682

PENNSYLVANIA 475 Allendale Road Suite 201 King of Prussia, PA 19406 (215)962-3846

960 Pennsylvania Avenue Fifth Floor Pittsburgh, PA 15222 (412)644-2780

PUERTO RICO Carlos Chardon Avenue Room 691 Hato Rey, PR 00918 (809) 753-4002

RHODE ISLAND 380 Westminister Mall Fifth Floor Providence, Rl 02903 (401)528-4586

SOUTH CAROLINA 1835 Assembly Street Room 358 Columbia, SC 29202 (803) 765-5376

SOUTH DAKOTA 101 South Main Avenue Suite 101 Sioux Falls, SD 57102- 0527 (605) 336-2980

TENNESSEE 404 James Robertson Parkway Suite 1012 Nashville, IN 37219 (615)736-5881

97

TEXAS 1100 Commerce Street Room 3C-36 Dallas, TX 75242 (214)767-0605

222 East Van Buren Street Room 500 Harlingen, TX 78550 (512)427-8533

2525 Murworth 915 Suite 112 Houston, TX 77054 (713)660-4401

1611 Tenth Street Suite 200 Lubbock, TX 79401 (806) 743-7462

7400 Blanco Road Suite 200 San Antonio, TX 78216 (512)229-4535

10737 Gateway West Suite 320 El Paso, Tx 79902 (915)541-7586

UTAH 125 South State Street Room 2237 Salt Lake City, UT 84138- 1195 (314)524-5800

VERMONT 87 State Street Room 205 Montpelier, VT 05602 (802) 828-4474

VIRGINIA 400 North 8th Street Room 3015 Richmond, VA 23240 (804)771-2617

WASHINGTON 915 Second Avenue Room 1792 Seattle, WA 98174-1088 (202) 442-5534

W 920 Riverside Avenue Room 651 Spokane, WA 99210 (509) 456-3783

WEST VIRGINIA 168 West Main Street Fifth Floor Clarksburg, WV 26301 (304) 623-5631

WISCONSIN 212 East Washington Ave. Room 213 Madison, Wl 53703 (608) 264-5261

WYOMING 100 Bast "B" Street Casper, WY 82602-2839 (307)261-5761

98

APPENDIX VIII Glossary of Forest Products and Exporting Terms

ACCEPTANCE: (1) A time draft (or bill of exchange) which the drawee (the payer) has accepted and is unconditionally obligated to pay at maturity. The draft must be presented first for acceptance—the drawee becomes the "acceptor"—then for payment. The word "accepted" and the date and place of payment must be written on the face of the draft. (2) The drawee's act in receiving a draft and thus entering into the obligation to pay its value at maturity. (3) Broadly speaking, any agreement to purchase goods under specified terms.

ALONGSIDE: A phrase referring to the side of a ship. Goods to be delivered "alongside" are to be placed on the dock or lighter within reach of the transport ship's tackle so that they can be loaded aboard the ship.

BALK: Sawn or hewn wood ranging from 3x3 inches to 16 x 16 inches and up to 28 feet long.

BATTENS: Lumber 2-3 inches thick (50-75 mm), 4-8 inches wide (10-20 cm), 9 feet (2.75m) and up, used to cover joints of boards or plywood in siding applications.

BILL OF LADING: A document that establishes the terms of a contract between a shipper and a transportation company under which freight is to be moved between specified points for a specified charge. Usually prepared by the shipper on forms issued by the carrier, it serves as a document of title, a contract of carriage, and a receipt for goods.

BLOCKBOARD: Panels consisting of a wood strip core glued together and surfaced with veneers having grain direction perpendicular to that of the core.

BONDED WAREHOUSE: A warehouse authorized by customs authorities for storage of goods on which payment of duties is deferred until the goods are removed.

BOOKING: An arrangement with a steamship company for the acceptance and carriage of freight.

BOULES: Flitches sawn from bottom logs which are classified and measured as one unit.

C. & F.: A pricing term indicating that "cost and freight changes" are included in the quoted price.

C. & I.: A pricing term indicating that "cost and insurance" charges are included in the quoted price.

C.I.F.: A pricing term indicating that "cost, insurance, freight" charges are included in the quoted price.

C.I.F. & C: A pricing term indicating that "cost, insurance, freight, and commission" charges are included in the quoted price.

99

C.I.F. & E.: A pricing term indicating that "cost, insurance, freight, and (currency) exchange" charges are included in the quoted price.

CANT: Large sawn timbers to be processed further.

CHECK: A lengthwise crack in wood across or through the annual growth rings caused by rapid drying.

CONFIRMED LETTER OF CREDIT: A letter of credit, issued by a foreign bank, with validity confirmed by a U.S. bank. An exporter whose payment terms are a confirmed letter of credit is assured of payment even if the foreign buyer or the foreign bank defaults. See LETTER OF CREDIT.

CONIFEROUS (softwoods): Wood obtained from trees classified botanically as "gymnospermae" or "softwoods" such as pines, spruces, and firs.

CONSIGNMENT: Delivery of merchandise from an exporter (the consignor) to an agent (the consignee) under agreement that the agent sell the merchandise for the account of the exporter. The consignor retains title to the goods until the consignee has sold them. The consignee sells the goods for commission and remits the net proceeds to the consignor.

CONSULAR DECLARATION: A formal statement, made to the consul of a foreign country, describing goods to be shipped.

CONSULAR INVOICE: A document, required by some foreign countries, describing a shipment of goods and showing information such as the consignor, consignee, and value of the shipment. Certified by a consular official of the foreign country, the invoice is used by the country's Customs officials to verify the value, quantity, and nature of the shipment.

CORD: Measurement term used for pulpwood volume. One cord measures 4x4 feet = 128 cubic feet, stacked.

COUNTERTRADE: International trade in which the seller is required to accept goods or other instruments of trade in partial or whole payment for its products.

COUNTERVAILING DUTY: An extra duty imposed by the Secretary of Commerce to offset export grants, bounties, or subsidies paid to foreign suppliers In certain countries by the government of those countries as an incentive to export.

CREDIT RISK INSURANCE: Insurance designed to cover risks of nonpayment for delivered goods. Compare MARINE INSURANCE.

CROSSING: Switch ties, lengths from 9-24 feet and 6x12 inches in size.

CURLY GRAIN: Wavy grained.

100

CUSTOMHOUSE BROKER: An individual or firm licensed to enter and clear goods through Customs.

DEAL: A board or plank usually 2-4 inches (50-100 mm) thick; 9 inches (23 cm) and more, wide; and 9 feet (2.75 m) and up, long.

DEMURRAGE: Excess time taken for loading or unloading a vessel. Demurrage refers only to situations in which the charterer or shipper, rather than the vessel's operator, is at fault.

DRAFT (OR BILL OF EXCHANGE): An unconditional order in writing from one person (the drawer) to another (the drawee), directing the drawee to pay a specified amount to a named payee at a fixed or determinable future date.

DRAWEE: The individual or firm on whom a draft is drawn and who owes the indicated amount. Compare DRAWER. Also see DRAFT.

DRAWER: The individual or firm that issues or signs a draft and thus stands to receive payment of the indicated amount from the drawee. Compare DRAWEE. Also see DRAFT.

DUTY: A tax imposed on imports by the Customs authority of a country. Duties are generally based on the value of the goods (ad valorem duties), but may be based on some other factor such as weight or quantity (specific duties), or combination of value and other factors (compound duties).

EXPORT-IMPORT BANK: An independent U.S. Government Agency created to facilitate U.S. trade relations primarily through providing financing, insurance, and feasibility studies.

F.A.S.: "Free Alongside (vessel)" is a pricing term indicating that the quoted price includes the cost of delivering the goods alongside a designated vessel.

F.I.: "Free In" is a pricing term indicating that the charterer of a vessel is responsible for the cost of loading goods onto the vessel.

F.I.O.: "Free In and Out" is a pricing term indicating that the charterer of a vessel is responsible for the cost of loading and unloading goods from the vessel.

F.O.: "Free Out" is a pricing term indicating that the charterer of a vessel is responsible for the cost of loading goods from the vessel.

F.O.B.: "Free On Board" is a pricing term indicating that the quoted price includes the cost of loading the goods into transport vessels at the specified place.

FIBERBOARD: A panel of wood or other ligneous materials, whether or not bonded with resins or other organic substances. This category includes hardboard, medium density fiberboard, and insulation board.

101

FOREIGN CREDIT INSURANCE ASSOCIATION (FCIA): An association of 50 insurance companies which operate in conjunction with the EXIMBANK to provide comprehensive insurance for exporters against nonpayment. FCIA underwrites the commercial credit risks. EXIMBANK covers the political risk and any excessive commercial risks.

FOREIGN SALES AGENT: An individual or firm that serves as the foreign representative of a domestic supplier and seeks sales abroad for the supplier.

FREE TRADE ZONE: A port designated by the government of a country for entry of any nonprohibited goods. Merchandise may be stored, displayed, used for manufacturing, etc., within the zone and re-exported without duties being paid. Duties are imposed on the merchandise (or items manufactured from the merchandise) only when the goods pass from the zone into an area of the country subject to Customs.

GENERAL EXPORT LICENSE: Any of various export licenses covering export commodities for which validated export licenses are not required. No formal application or written authorization is needed to ship under a general export license. Compare VALIDATED EXPORT LICENSES.

HARDBOARD: A panel manufactured primarily from interfelted wood fibers consoli- dated under heat and pressure. The inter-fiber bond is primarily achieved through the wood's natural lignin and interfelting bonding. Other materials may be added during manufacture to improve certain properties. Hardboard density is greater than 0.5 g/ cm3 (31 Ibs/fts^) and typically 0.65 - 0.95 g/cm^ (40 - 60 lbs/ft^).

INDUSTRIAL WOOD: Roundwood including sawlogs, veneer logs, pulpwood, pitprops, poles, pilings, posts, and railroad ties or sleepers.

INLAND BILL OF LADING: A bill of lading used in transporting goods overland to the exporter's international carrier. Although a through bill of lading can sometimes be used, it is usually necessary to prepare both an inland bill of lading and an ocean bill of lading for export shipments.

IRREVOCABLE LETTER OF CREDIT: A letter of credit in which the specified payment is guaranteed by the bank if all terms and conditions are met by the drawee (buyer).

LETTER OF CREDIT (L/C): A document, issued by a bank under instructions from a buyer of goods, authorizing the seller to draw a specified sum of money under specified terms, usually the receipt by the bank of certain documents within a given time.

LOAD: Measurement term for log and lumber volume: 40 cubic feet of logs equals 1.13 cubic meters and 50 cubic feet of lumber equals 1.416 cubic meters.

LUMBER: Wood sawn lengthwise from logs.

102

MARINE INSURANCE: Broadly, insurance covering loss or damage of goods at sea. Marine insurance will typically compensate the owner of merchandise for losses sustained from fire, shipwreck, piracy, and various other causes; but it excludes losses which can be legally recovered from the carrier. Compare CREDIT RISK INSUR- ANCE.

MEDIUM DENSITY FIBERBOARD (MDF): A panel product manufactured from wood fibers combined with a synthetic resin or other suitable binder. The panels are manufactured by the application of heat and pressure by a process in which the inter-fiber bond is substantially created by the added binder. The typical density range for MDF is 31-50 lbs/ftM0.5-0.8g/cm3).

NON-CONIFEROUS (hardwoods): Wood obtained from trees classified botanically as "angiospermae" or "hardwood" such as oak, maple, ash, and poplar.

OCEAN BILL OF LADING: A bill of lading indicating that the exporter consigns a shipment to an international carrier for transportation to a specified foreign market. Unlike the inland type, the ocean bill of lading also serves as a collection document. If it is a straight bill of lading, the foreign buyer can obtain the shipment from the carrier by simply showing proof of identity. If a negotiable bill of lading is used, the buyer must first pay for the goods, post a bond, or meet other conditions agreeable to the seller. Compare INLAND BILL OF LADING, THROUGH BILL OF LADING.

OFFSET: A variation of countertrade in which the seller is required to assist in or to arrange for the marketing of locally produced goods.

OPEN ACCOUNT: A trade arrangement in which goods are shipped to a foreign buyer without guarantee of payment. The obvious risk this method poses to the supplier makes it essential that the buyer's integrity be unquestionable.

PARTICLEBOARD: A panel manufactured from wood particles or combinations of wood particles and fibers, bonded together with synthetic resins under heat and pressure. The inter-particle bond is created almost entirely by the bonding system. Thickness ranges from 1/4 -2" (6-50 mm) and density from 27-55 lbs ft^ (.43 - .88 g/

PETROGRAD STANDARD: Measurement unit for softwood lumber volume equal to 165 cubic meters, 1.980 thousand board feet, or 4.672 cubic meters.

PHYTOSANITARY INSPECTION CERTIFICATE: A certificate, issued by the USDA to satisfy import regulations of foreign countries, indicating that a U.S. shipment has been inspected and is free from harmful pests and plant diseases.

PILING: Long straight logs used for supporting docks, bridges, and buildings.

PITPROPS: Round wood used as supports in mining operations which are 3-6 inches in diameter and 3-1/2 feet and up in length.

103

PLYWOOD: Consists of three or more veneer sheets of wood glued and bonded by heat and pressure with the grain in each sheet at an angle to adjacent layers.

POLES: Roundwood used to support telephone, telegraph, and electrical transmission wires or scaffolding.

PRO FORMA INVOICE: An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and important specifications (weight, size, etc.).

PULPWOOD: Wood used for pulping and producing wood chips or particles to manufacture wood fiber-based panels. Actual solid wood content in the stacked wood volume varies according to diameter, straightness, and method of piling. In Europe, bolts are 3.3 feet (1 meter) long and 2-5 inches in diameter.

REVOCABLE LETTER OF CREDIT: A letter of credit which can be canceled or altered by the drawee (buyer) after it has been issued by the drawee's bank. Compare IRREVOCABLE LETTER OF CREDIT.

RICKERS: Small coniferous logs measuring 1 1/2-3 inches (31/2-8 centimeters) in diameter and 16 - 50 feet (5-15 meters) long. Rickers are generally used for scaffolding.

SCANTLING: Lumber size 2 inches thick, less than 8 inches wide, and from 9 feet (2.75 meters) long.

SHAKES: A separation of the wood along an annual ring (ring shake) or cracks radiating from the heart (heart shake). Shakes may occur in a standing tree and are caused by frost, wind, or when the tree is felled.

SLEEPERS: Railroad ties.

STAVES: Narrow pieces of wood—1-2 inches thick and 3-5 inches wide—used to manufacture barrels and casks.

STEAMSHIP CONFERENCE: A group of steamship operators that operate under agreed upon freight rates.

SURFACE MEASURE: A method of determining lumber and plywood volume based on surface area—thickness is not taken into account.

SWAP ARRANGEMENTS: A form of trade in which title to similar or identical products from different locations is traded to save transportation costs.

SWITCH ARRANGEMENTS: A form of countertrade in which the seller sells on credit and then transfers the credit to a third party.

THROUGH BILL OF LADING: A single bill of lading covering both the domestic and international carriage of an export shipment. An air waybill, for instance, is essentially

104

a through bill of lading used for air shipments. Ocean shipments, on the other hand, usually require two separate documents, an inland bill of lading for domestic carriage and an ocean bill of lading for international carriage; through bills of lading, therefore, cannot be used. Compare INLAND BILL OF LADING, OCEAN BILL OF LADING.

TRAMP STEAMER: A ship not operating on regular routes or schedules.

VALIDATED EXPORT LICENSE: A document issued by the U.S. Government authorizing the export of commodities for which written export authorization is required by law. Compare GENERAL EXPORT LICENSE.

VENEER SHEETS: Thin sheets of wood of a specified thickness, peeled, sliced, or sawn for use in plywood, paneling, and furniture.

W.A.: "With Average" is a marine insurance term meaning that a shipment is protected from partial damage whenever the damage exceeds 3 percent (or some other percentage).

WOODPULP: Wood that has been mechanically and/or chemically processed for use in the manufacture of paper, paperboard, or other cellulose products.

105

APPENDIX IX Forest Products Volume Conversion Units

In North America, the most common way to describe a volume of round wood is in terms of units of 1,000 board feet. The term "Mfbm" is best understood as a volume of lumber, not round wood. Historically, however, there was a desire to measure a volume of round wood in terms of the volume of lumber which could be sawed from the round wood. This resulted in the development of the unit of 1,000 bf for logs, which actually defines the amount of round wood which would produce, after all sawing operations, 1,000 bf of lumber. This approach required estimation of the yield of sawing operations. Naturally such estimates are difficult and never very accurate. Consequently, there exist many log rules which claim to define the amount of round wood which would give 1,000 fbm of lumber. Comparisons of actual cubic content of logs defined by these various log rules indicate that there are differences which depend on the assumptions made at the time the rules were proposed.

Of the many log rules several which are considered more important are shown in subsequent tables. These are: International 1/4", Scribner, and Doyle Log Rules.

The tables presented here are printed with permission from Binek, A., Forest Products in Terms of Metric Units.

106

Comparsíon of Various Log Rules

Comparisons of the volumes of 16 ft. logs expressed in board feet according to Doyle, Scribner, and International 1/4" Log Rules, with the volumes of the same logs expressed in ft^ and m^.

Dia. (Inch)

Board Feet Cubic Volume

Doyle Scribner Int.-Nat. 1/4" ft^ m'

8 16 32 40 5.59 0.158

9 25 42 50 7.07 0.200

10 36 54 65 8.73 0.247

11 49 64 80 10.56 0.299

12 64 79 95 12.57 0.356

13 81 97 115 14.75 0.418

14 100 114 135 17.10 0.484

15 121 142 160 19.63 0.556

16 144 159 180 22.34 0.633

17 169 185 205 25.22 0.714

18 196 213 230 28.27 0.800

19 225 240 260 31.50 0.892

20 256 280 290 34.91 0.989

21 289 304 320 38.48 1.090

22 324 334 355 42.24 1.196

23 361 377 390 46.16 1.307

24 400 404 425 50.26 1.423

25 441 459 460 54.54 1.544

26 484 500 500 58.99 1.671

27 529 548 540 63.62 1.802

28 576 582 585 68.42 1.938

29 625

676

609 630 73.39 2.078

30 657 675 78.54 2.224

Volume equivalents

Logs Without Bark

MBP^' 140ft3 3.96 m^ based on "60 % factor

yield"

MBF<2> 160 ft3 4.53 m3 based on FAO conversion factor

MBP3) 123ft3 3.48 m^ based on International 1/4" Log Rule

MBP3) 138 tt3 3.90 m^ based on Scribner Log Rule

MBP3) 162 «3 4.59 m3 based on Doyle Log Rule

107

Comparison of Various Log Rules

Selected units of volume of roundwood without bark accepted in international trade

MBP^' ft^ m^ load

MBP" 1.000 140 3.96 3.50 cunit 0.714 100 2.83 2.50 m3 0.253 35.31 1.00 0.88 load 0.283 40.00 1.13 1.00

MBP^' m:" ft^ load

1 3.96 140 3.50 10 39.60 1400 35.00 100 396.00 14000 350.00 1000 3960.00 140000 3500.00

ft^ m' MBP') load

100 2.83 0.714 2.50 1000 28.30 7.140 25.00 10000 283.00 71.400 250.00 100000 2830.00 714.000 2500.00

m^ ft^ MBPi> load

1 35.31 0.253 0.88 10 353.10 2.530 8.80 100 3531.00 25.300 88.00 1000 35310.00 253.000 880.00

load m^ ft^ MBP^>

1 1.13 40 0.283 10 11.30 400 2.830 100 113.00 4000 28.300 1000 1130.00 40000 283.000

<^> "60% yield" factor assumes average yield of sawing operations to be 60%.

<2' FAO conversion factor applies to ail saw and veneer logs.

'^' Figures based on cubic volume of a log 16 ft. long and 15 in. diameter under bark at top end. Could be used for average comparisons when accuracy of + 10% is acceptable. More precise comparisons require computation of volume for each using individual log rules.

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Volume Conversion Factors for Lumber

Cubic feet ft^ X ( 3.03703 = yd^ X 0.02832 = m^ X 0.01200 = Mfbm X 0.0200 = load X 0.00606 = Pstd. X 12 = boardfeet

Cubic meter m^ X 35.314 = ff X 1.3079 = yd^ X 0.424 = Mfbm X 0.706 = load X 0.214 = Pstd.

load X 50 = ft^ X 1.416 = m= X 0.600 = Mfbm X 0.303 = Pstd.

Mfbm X 83.33 = ft^ X 2.358 = m^ X 1.667 = load X 0.505 = Pstd.

Pstd. X 165 = ft^ X 4.670 = m^ X 3.300 = load X 1.980 = Mfbm

Volume equivalents for lumber

Mfbm ft^ m^ load Pstd.

Mfbm 1.000 83.33 2.358 1.667 0.505

Cunit 1.200 100.00 2.832 2.00 0.606

m3 0.424 35.31 1.000 0.706 0.214

load 0.600 50.00 1.416 1.000 0.303

Pstd. 1980.000 165.00 4.670 3.300 1.000

109

Conversion of 1 m^ Mfbm, and Load into m^ and ft^ for various thicknesses of lumber.

Thickness 1 m^ iVIfbm 1 Load

in. mm m^ ft^ m^ ft21 m^ ft'

10.00 100.0 1076 236.0 2539 141.60 1524

1/2 = 12.70 78.7 847 185.7 2002 111.44 1199

5/8 = 15.87 63.0 677 148.7 1603 89.21 960 16.00 62.5 672 147.5 1590 88.50 952 18.00 55.5 597 131.0 1412 78.73 845

3/4 = 19.05 52.5 565 123.9 1333 74.34 800 20.00 50.0 538 118.0 1269 70.80 762 22.00 45.5 489 107.4 1158 64.43 693

7/8 = 22.22 45.0 484 106.2 1143 63.72 686 24.00 41.7 448 98.2 1059 59.04 635

25.00 40.0 430 94.4 1016 54.64 609 4/4 = 25.40 39.4 424 93.0 1000 55.79 600

30.00 33.3 358 78.6 846 47.15 507 5/4 = 31.75 31.5 339 74.3 800 44.60 480 6/4 = 38.10 26.2 282 61.8 665 37.10 399

40.00 25.0 269 59.0 635 35.40 381 7/4 = 44.45 22.5 242 53.1 571 31.86 343

50.00 20.0 215 47.2 508 28.32 305 2 = 50.80 19.7 212 46.5 500 27.90 300 2 1/2 = 63.50 15.7 169 37.1 400 22.23 239

65.00 15.4 166 36.3 391 21.80 235 3 = 76.20 13.1 141 31.0 333 18.55 200

80.00 12.5 135 29.5 317 17.70 190 100.00 10.0 108 23.6 254 14.16 152

4 = 101.60 9.8 105 23.1 249 13.88 149

'■' NOTE: In North America all lumber less than 1" (4/4) thick is scaled as if it were actually 1" thick, i.e.,

board measure equals surface measure for these thicknesses.

110

Conversón of Mfbm and mMo ftând m^ for panel products

Thickness IVIfbm = 2.36 m^ m^ = 35.31 ft'

in. mm ft^ m^ ft^ m^

2.00 12696 1180 5380 500.00

1/10 2.54 10000 929 4237 393.90

3.00 8468 787 3588 333.33

1/8 3.18 7985 742 3385 314.47

1/7 3.63 6995 650 2965 275.48

5/32 3.97 6396 594 2711 251.89

4.00 6348 590 2691 250.00

1/6 4.23 6003 558 2545 236.41

3/16 4.76 5336 496 2261 210.08

5.00 5078 472 2153 200.00

6.00 4232 393 1794 166.67

1/4 6.35 4000 372 1695 157.48

8.00 3174 295 1345 125.00

9.00 2821 262 1196 111.11

3/8 9.53 2664 248 1129 104.93

10.00 2539 236 1076 100.01

12.00 2116 197 897 83.33

1/2 12.70 2000 186 848 78.74

13.00 1953 182 828 76.92

14.00 1813 169 769 71.43

5/8 15.88 1599 149 678 62.97

16.00 1592 148 673 62.50

11/16 17.40 1459 136 619 57.47

18.00 1410 131 598 55.56

3/4 19.05 1333 124 565 52.49

20.00 1269 118 538 50.00

7/8 22.22 1142 106 484 45.00

23.00 1104 103 468 43.48

24.00 1058 98 448 41.67

25.00 1016 94 430 40.00

4/4 25.40 1000 93 424 39.37

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Average Conversion Factors For Wood Products (English to Metric)

Std Ind To Convert Product Unit To Convert To: Multiply from Metric

(English) By: Multiply By: Logs MBF Cubic Meters 4.530 0.2208 Softwood Lumber MBF Cubic Meters 2.360 0.423729 Hardwood Lumber MBF Cubic Meters 2.360 0.423729 Softwood Flooring MBF Cubic Meters 2.360 0.423729

MSF(1") Square Meters (25.4 MM Thickness) 92.900 0.0108

Hardwood Flooring MBF MSF(1")

Cubic Meters Square Meters

2.360 0.423729

(25.4 MM Thickness) 92.900 0.0108 Softwood Siding MBF

MSF(1") Cubic Meters Square Meters

2.360 0.423729

(25.4 MM Thickness) 92.900 0.0108 Hardwood Siding MBF

MSF(1") Cubic Meters Square Meters

2.360 0.423729

(25.4 MM Thickness) 92.900 0.0108 Railroad Ties MBF Cubic Meters 2.360 0.423729 Softwood Veneer

MSF (3/8") Cubic Meters 0.885 1.132 Square Meters

(9.53 MM Thickness) 92.900 0.0108 Hardwood Veneer


(.0907 MM Thickness) 92.900 0.0108 Softwood Plywood


(9.53 MM Thickness) 92.900 0.0108 Hardwood Plywooc 1


(6.35 MM Thickness) 92.900 0.0108 Particleboard MSF (3/4") Cubic Meters 1.770 0.565

Square Meters (19.05 MM Thickness) 92.900 0.0108

Wood Chips STN Metric Tons 0.907 1.102 Molding M FT Meters 304.8 0.0033 Other

To Convert From: To: Multiply By: Square Meters

(25.4 MM Thickness) Cubic Meters 0.0254

112

Important Shipping Parameters

Weight

APPENDIX X Forest Products Shipping Weights and Volumes

The cost of transportation is based on: weight, volume, and stowage factor.

Wood products originate fronn living fibers and as such are more difficult to measure than other raw materials.

The weight of wood depends on species and moisture content. It also depends to a lesser degree on rate of growth, growing site, proportion of sapwood to heartwood, thickness of the bark, and stowing methods.

Bottom logs usually are heavier than second- or third-cut logs.

To reduce damage through handling and season checking during transportation, veneer logs are often delivered with the bark on.

Fresh-cut roundwood can be grouped into four density categories:

1. Very heavy; 65 lbs/ft^ up = 1040 kg/m^ up

2. Heavy; 55-64 lbs/ft^ = 880-1024 kg/m^

3. Moderate; 45-54 lbs/ft^ = 720-864 kg/m^

4. Light; 35-44 lbs/ft^ = 560-704 kg/m^

The weight of any given species depends very strongly on moisture content.

Weight * Moisture Content

Fresh-cut roundwood 65 lbs/ft^ (100%) Approx. 40-60%

After 6 months approx 56 lbs/ft^ ( 86%) Approx. 30%

"Shipping dry" lumber 52 lbs/ft^ ( 80%) Approx. 20%

"Kiln-dry" lumber for the production of flooring 48 lbs/ft^ = ( 74%) Approx. 10%

The production of furniture parts 47 lbs/ft^ ( 72%) Approx. 8%

* With no allowance for shrinkage of the wood.

The information presented here is printed with permission from Binek, A., Forest Products in Terms of Metric Units.

This means, for example, that a very heavy species of wood in a "fresh-cut" state would weigh 65 lbs/ft^ = 1040 kg/m^. The same log would weigh approx. 56 lbs/ft^ = 897 kg/m^ after 6 months if left in round state. For this species:

Shipping dry lumber would weigh approx. 52 lbs/ft^ = 833 kg/m^ Kiln-dry lumber for flooring would weigh approx. 48 lbs/ft^ = 769 kg/m^ Kiln-dry lumber for furniture parts would weigh approx. 47 lbs/ft^ = 753 kg/m^

The specific gravity is 1.0 at 4° C. at normal pressure. One cubic foot of water weighs 62.4 lbs.

113

Approximate shipping weight of logs and lumber of coniferous North American species

North American Species

ib/ft^ I(g/m3 (a)

kg/m^ (b)

t/chord (a)

t/Mfbm (a)

t/Mfbm (b)

Fir Douglas (Oregon Pine) 47 750 600 1.810 2.980 1.430

Fir Balsam 39 625 500 1.350 2.500 1.200

Fir White 38 610 490 1.465 2.410 1.160

Fir Silver 40 640 510 1.540 2.540 1.210

Fir Grand 42 670 540 1.620 2.670 1.280

Hemlock Eastern 45 720 580 1.735 2.860 1.370

Hemlock Western 48 770 620 1.850 3.050 1.460

Larch Eastern 47 750 600 1.810 2.980 1.430

Larch Western 50 800 640 1.930 3.180 1.520

Pine Jack 44 700 560 1.700 2.800 1.340

Pine Pitch 50 800 640 1.930 3.180 1.520

Pine Ponderosa 42 670 510 1.620 2.670 1.210

Pine Red 44 700 560 1.700 2.800 1.340

Pine White Eastern 40 640 510 1.540 2.540 1.210

Pine White Western 42 670 540 1.620 2.670 1.280

Pine Sugar 42 670 540 1.620 2.670 1.280

Pine Southern Yellow Longleaf 55 880 700 2.120 3.490 1.650

Shortleaf 50 800 640 1.930 3.180 1.520

Slash 58 930 750 2.240 3.680 1.770

Spruce Black 45 720 580 1.735 2.860 1.370

Spruce Engelmann 38 610 490 1.465 2.410 1.160

Spruce Red 42 670 540 1.620 2.670 1.280

Spruce Sitka 40 640 510 1.540 2.540 1.210

Spruce White 40 640 510 1.540 2.540 1.210

Cedar Red 37 590 413 2.350 0.990

Cedar White 32 510 351 2.030 0.850

Redwood California 45 720 510 2.860 1.210 Note: mâ = 35.31 ft^ of logs, Mfbm a = 140 iWS.

m^b = 35.31 ft^ of lumber, Mfbm b = 83.33 96 m^ of logs fe/2.36 m3 of lumber

cord: 90 ft^ = 2.55 m^ solid wood

(a) Roundwood (b) Lumber

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Weight conversion factors

Unit of weight Equivalents

Pounds X 0.45359 = kg lbs X 0.0004536 ) = t (metric ton)

X 0.0004464 Ï = tn (long ton) X 0.000500C ) = shtn (short ton)

Kilograms X 2.2046 = lbs

kg X 0.001 = t (metric ton) X 0.000984 = tn (long ton) X 0.001102 = shtn (short ton)

Ton metric X 2204.622 = lbs t X 1000 = kg

X 0.9842 = tn X 1.1023 = shtn

ton long X 2242 = lbs tn X 1016.04 = kg

X 1.01604 = t X 1.12 = shtn

Ton short X 2000 _ lbs shtn X 907.184 = kg

X 0.907184 = t X 0.892857 = tn

Equivalents for weiglits and voiumes for conventional shipping units

Weight Estimate Volume Assumed 1 Specific Weight lUletric Tons ft^ m^ Ib/ft^" kg/m^

1 loading ton of round wood 40 1.132 55 883 1 loading ton of lumber 50 1.416 44 706 1 ton of plywood conif. 63 1.784 35 560 1 ton of plywood non-conif. 55 1.560 40 640 1 ton of plywood particleboard 55 1.560 40 640 1 ton of plywood hardboard 37 1.050 59 950 1 ton of plywood softboard 118 3.330 19 300

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International Container Standards

Freight containers are a popular method of shipping lumber and wood products. These containers can be packed and sealed at the manufacturer and not reopened until the product reaches the final customer. During shipment, the products such as veneer logs, lumber, dimension stock, flooring, mouldings, panel products, furniture and veneer are protected from pilferage and the environment. These containers come in standardized sizes and can be transported by ship, truck and rail.

The majority of containers used today come in one of five lengths: 20 ft, 40 ft, 45 ft, 48 ft, or recently 53 ft. Most containers are 8' wide and 8'-6" tall. Although some containers, called high-cube, are 9'-6" tall. In the table below, the average internal dimensions and capacity for each type of container is shown. These dimensions may vary from one model to another, and carriers should be consulted well in advance of shipping for specifications, availability, and rates. Many carriers provide valuable assistance and information on loading and operating their equipment.

At present, the 48-ft and 53-ft containers, which have an outside width of 8' -6", are only used in domestic rail and truck transportation. This may change as new ocean vessels which are capable of handling the wider containers are developed.

Maximum cargo weights are limited by carriers to comply with restrictions on particular transport and handling equipment or limits enforced by Government agencies to protect roads and bridges. Due to low product density or load limits, many loads do no utilize the maximum rated weight capacity of the container. If the container is shipped to the port by rail, or loaded at the port, more cargo may be loaded. Some states provide overweight permits for highway travel.

Container type Interior Dimensions Capacity Length Height Width Volume Weight

20 foot 19'4" 7'9" 7'8" 1186ft3 410001b

40 foot 39" 6" 7'10" 7'8" 2387 ft^ 58867 lb

40 foot, high-cube 39' 6" 8'4" 7'8" 2548 ft= 60400 lb

45 foot, high-cube 44' 6" 8' 10" 7'8" 3050 ft= 64250 lb

48 foot, high-cube 47' 6" 8'10" 8'2" 3450 ft^ 59100 lb

53 foot, high-cube 52" 6" 8'10" 8'2" 3830 ft= 56920 lb

20 foot 589 cm 236 cm 234 cm 33.5 m3 18598 kg

40 foot 1204 cm 239 cm 234 cm 67.6 m3 26702 kg

40 foot, high-cube 1204 cm 254 cm 234 cm 72.2 m^ 27397 kg

45 foot, high-cube 1356 cm 269 cm 234 cm 86.4 m3 29144 kg

48 foot, high-cube 1448 cm 269 cm 249 cm 97.7 m3 26808 kg

53 foot, high-cube 1600 cm 269 cm 249 cm 109m3 25819 kg

Source: Example specifications from the Official Intermodal Equipment Register.

March 1989

116 *U3.COVB(NMENTPIUhrnNCOmCE:l9 91 -ei7-SS<>Allo*