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No. 537 December 2013 WHA Board of Directors
Mike Lipke President
Lee Jimerson Vice President
Kurt Landwehr Treasurer
Darrin Hastings Immediate Past President
Adam Brennan
Nils Dickmann
Jeff Marthaller
John Smith
Lindy Stallard David Sweitzer Secretary/Manager P.O. Box 1095 Camas, WA 98607 Ph: (360) 835-1600 Fax: (360) 835-1910 Web: www.westernhardwood.org Email: [email protected]
Merry
Christmas
&
Happy
New Year! Come kick off the new year with WHA!
January 15th, 2014
See inside for details.
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Two leading indicators of
domestic grade lumber
demand—new home starts and existing home sales—
slid from peak levels in late summer. Moreover, higher
mortgage interest rates and relatively low housing
inventories have sparked concerns about additional
slowing in housing sales. The National Association of
Realtors, for example, is now forecasting that existing
home sales in 2014 will be little changed from 2013. –
excerpted from Hardwood Review Express
Hardwood suppliers on the West Coast
report that demand for hardwood lumber is
rising. One California source said that
they’ve seen more movement in 2013 than in
the last two years combined. He also
commented that when housing numbers are decent, the
whole industry benefits.
In Washington, one source said his customers have
a positive outlook for 2014. They
market mostly to flooring
manufacturers, cabinet and
furniture. He said his business has
continually improved since January
2013.
A wholesaler in Oregon noted that his business has
continued about the same in 2013.
Although they’ve had a couple of little
spots month-over-month, they’ve been
steady all year and business has been good
for the majority of it.
Monthly reports since May 2013: Building
Permits up 13.9% … Building Permits up 12.4% …
Building Permits up 16.1% … Building Permits up
20.8% … Building Permits up 35.8% … Building
Permits up 17.3%...
Do you sense a pattern here? Demand for
hardwoods and hardwood products is strong, and
housing is just one part of the demand equation. Our
* Welcome New Members
* Outlook
* News in the News
* ICE
* Legislative Update
* Upcoming Events
* Get Motivated
In This Issue:
Jo in WHA First time membership is $150 the first year and for a limited time, $150 for the second year also.
The WHA is the only organization dedicated exclusively to the availability and promotion of Western Hardwoods. Membership benefits include:
online membership directory listing one free newsletter ad company profile in newsletter our monthly email newsletter important industry updates by email a free banner ad on WHA’s website cost effective newsletter advertising networking at the Annual Meeting discounts on Association meeting registration
Joining is quick and easy. Use the online membership application and simply pay by credit card, www.westernhardwood.org.
wet and stormy year in the U.S., along with other
factors, has hampered hardwood production, so demand
stayed very firm. According to the ANCHORSEAL
Index, it looks like 2013 production will only be about
the same or a bit higher than 2012’s – and the customers
all want a piece of this limited supply.
Six years ago I worried about over-producing into
rising lumber prices, ultimately driving the prices
down. Now the challenge is to increase production to
satisfy un-met demand with (current) reduced log
supply and production capacity.
The general economy should remain solid for the
next 6-9 months. The mild recession at the end of 2014
will affect the hardwood industry less than the broader
economy, and then there should be consistent economic
growth from mid-2015 to 2019. If production can meet
the increasing demands for hardwoods, the rest of this
decade should be a boom time for hardwood producers,
with both prices and profits high. –Norm Murray, U*C
Coatings, LLC
The Organisation for Economic Co-operation
and Development
(OECD) says that world
trade should rebound
next year, with growth
increasing from its annual pace of 3.7 percent in 2013 to
5.5 percent in 2014. The OECD also forecasts
improvements in real GDP for the United States (up
from 1.7 percent to 2.9 percent), Europe (up from -0.4
percent to 1.0 percent) and China (up from 7.7 percent
to 8.2 percent). Despite such gains, weaknesses persist
in emerging markets, and continued political risks could
dampen the prospects for better growth. Other points in
the report include:
North American economies have improved in the
past few months, but Mexico is still growing very
slowly.
Europe’s economy continues to rebound from its
recession, but with persistent challenges in some
countries.
The Chinese economy continues to expand, even as
the pace remains below where it was in past years.
The economic situation in emerging markets also
improved.
Growth in U.S.-manufactured goods exports
remains frustratingly slow.
The U.S. trade deficit narrowed in October. -
excerpted from Global Manufacturing Economic Update
On Wednesday, November 13,
2013 the USDA released for comment the proposed
Hardwood Lumber and Hardwood Plywood Promotion,
Research and Information Order. To review the Order
on the Federal Register website, CLICK HERE. The
USDA Open Comment period for the Order runs
through January 13, 2014. All are encouraged to review
the Order and post your comments to the USDA.
The Hardwood Check Off initiative was led by a
group of US hardwood industry individuals who came
together to develop a Commodity Check Off program
for the hardwood industry. NHLA was not involved in
the creation of the Hardwood Check Off and has no
stance on the matter. Instead, the role of NHLA is to
disseminate information to the NHLA membership (and
industry at large) and to create an open forum whereby
NHLA members can voice their opinions and/or
concerns.
As a platform for exchange, NHLA has created a
Hardwood Check Off discussion on the NHLA Blog
which is located on the homepage of the NHLA website
- www.nhla.com/nhlablog. If you have thoughts,
opinions, or concerns that you would like to air, NHLA
hopes that you will share those on the NHLA Blog.
NHLA is also accepting Letters to the Editor about
the Hardwood Check Off; please email those to Renee
Hornsby at [email protected]. They will publish the
letters in the "Check Off Corner" of upcoming editions
of the Association's monthly magazine Hardwood
Matters.
According to the International Tropical Timber
Organization, the Chinese Ministry of Industry and
Information Technology has announced the
establishment of a Timber and Wood Products Spot
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Trading Platform. This development has been jointly
sponsored by the China Timber and Wood Products
Distribution Association (CTWPDA) and the China
Forestry Property Exchange Co., Ltd. This trading
platform will be open nationally and will provide
comprehensive timber industry services integrated with
logistics and information trade flows. The platform will
encompass a trading center, an information center, and a
pricing center to promote domestic and international
market development.
It is anticipated that the new trading platform will
reduce transaction costs in the industry, though the
stated objective is to promote the rapid and orderly
development of the timber industry across the country.
At the core of the initiative—and most potentially
problematic for North American suppliers—is the
opportunity the platform will provide for Chinese timber
importers to form purchasing alliances to enhance their
negotiation position in the international timber trade.
On one hand, this could be an opportunity to promote
more hardwood use. On the other hand, buying
“cartels’ could result anti-competitive purchasing
practices that would hurt North American hardwood
suppliers and be in violation of both U.S. anti-trust laws
and World Trade Organization laws. -excerpted from
Hardwood Review Express
Implemented in March 2013, the EU Timber
Regulation (EUTR) is affecting hardwood exporters and
importers. The EUTR requires proof of timber’s origin
and legality to ensure that no illegal timber is imported
into the EU. In this first year of implementation, there
have been positive impacts, of which the most important
is awareness of the disastrous situation with illegal
logging, driven by exports of illegal timber. Another
positive development is that tropical timber exporters
are documenting the legality of their wood exports. Yet
another is establishment of due diligence systems by EU
importers.
However, there are considerable problems to
Upcoming Meetings
January 15, 2014 WHA Board Meeting & Dinner Tualatin, OR Email: [email protected]
January 17-21,2014 Western Pallet Association Annual Meeting Rancho Mirage, CA Email: [email protected]
January 23, 2014 Mapping the Course Vancouver, WA Email: [email protected]
February 4 -5, 2014 How to Use Skyline XL & LogCost/Haul Spreadsheets Grand Mound, WA Email: [email protected]
February 11 -12, 2014 How to Use Skyline XL & LogCost/Haul Spreadsheets Redding, CA Email: [email protected]
March 12, 2014 Washington Hardwoods Commission Meeting TBD Email: w hc@wahardwoodscom m .com
Have upcoming event or company news? Let us know and we’ll help you get the word out, both here and on our website. Drop us a line and let us know!
2nd Annual
OWIC Wood Innovation Days
March 6-7, 2014 In previous Oregon Wood Innovation Center at Oregon
State University newsletters, you have learned about our
change to offering a BS degree in Renewable Materials.
We are excited that at 70 + students, our undergraduate
enrollment is now higher than any time in the last two
decades. This means that we have a much higher need
for internships for our students AND that there will be
many more highly qualified people to fill your entry-
level positions in the coming years. Last year, we devel-
oped a new event called OWIC Innovation Days in an
effort to help connect our students with industry profes-
sionals and to share the state-of-the art in innovation in
our industry. WHA is a partner in the program.
ensuring legal trade. For example, China exports
primary- and secondary-processed hardwood products
to Europe, based on imported logs which most often do
not have comprehensive documentation of their origin
and legality. Certain aspects of the implementation of
the EUTR may eventually be defined by courts of law,
as has been the case with the U.S. Lacey Act
Amendment. -excerpted from Hardwood Review Express
Two thousand and thirteen is proving to be a
year of milestones for U.S. hardwood lumber exports.
May, April, June and August were the strongest
exporting months in history. Through August, exports
of Poplar, Ash, Walnut and Hickory/Pecan were all
pacing at record levels, and Red Oak was tracking at a
26-year high. All told, exports are on pace to total
1.415 billion board feet (BBF) in 2013, which would
surpass last year by 96 million board feet (MMBF) and
surpass the 2006 record by 91 MMBF (all export data is
from the U.S. International Trade Commission (ITC)).
Exports will comprise 36% of U.S. hardwood lumber
consumption by non-industrial markets this year,
according to our estimates, the largest percentage ever.
A bipartisan group of 17 Senators wrote to Energy
& Natural Resources Committee Chairman Ron Wyden
(D-OR) and Ranking Member Lisa Murkowski (R-AK)
this month calling for reform of Federal forest management laws. Ten Republicans joined seven
Democrats from 11 states in the letter: The letter cites the “need to reform the management of the National
Forest System,” saying “The status quo on our federal
forests is unacceptable.” The letter applauds the committee for “renewed focus on addressing the root
cause of these economic and social hardships through the reform of the National Forest System intended to
increase the pace and scale of forest management,
including timber harvest.” After lauding the short-term extension of county payments, the signers say, “We
look forward to legislation to restore the health of all of Federal forests and strengthening our rural
communities.”
Early in December, the President issued a
memorandum directing the Federal government to procure 20% of the power they consume from
renewable sources by 2020. The memorandum updates renewable energy procurement guidelines first outlined
in the Federal Leadership on Energy Management
Executive Order 13514 from October 2009. The Administration is not using this memorandum as a
vehicle to change the definition of renewable energy
regarding biomass or question the carbon neutrality of biomass. The memorandum defines “renewable
energy” by referring back to the Executive Order, and the EO lists “biomass” in the renewable energy
definition. Biomass also is mentioned in the
memorandum under the category of thermal renewable energy. The memo prioritizes the installation of
“renewable energy on-site at Federal facilities.” Purchasing of renewable energy credits is given the
lowest priority among the five action options.
Issue updates from the Hardwood Federation—
Farm Bill: While there is not enough time to complete the steps to pass a bill this year, four Farm
Bill “principals” met for a negotiating session trying to finalize a deal on a 5-year Farm Bill. Signals coming
out of the meeting indicate that a deal may be at hand
and a comprehensive Farm Bill could be enacted in January. The forest roads area is a problem because
Senator Boxer has asserted jurisdiction over the issue
and this had given Senate Agriculture Committee Chairman Debbie Stabenow pause. The Hardwood
Federation is reaching out to its key allies in the Senate-notably Senators Donnelly, McCaskill and Pryor-to
reach out to Chairman Stabenow and advise her that
including forest roads will actually attract votes in the Senate.
Energy Tax Reform: The Senate Finance Committee unveiled a discussion draft of energy tax
legislation as a market to begin formal discussion of the
energy tax component of comprehensive tax reform. The document is a disappointment for generators and
users of thermal energy-which we generate and use in
our hardwood operations. Thermal energy, whether it is in the form of solar, geo or biomass, is completely
omitted form the document.
Lacey Act Funding The Hardwood Federation
and its Lacey Act group associates have been at work
meeting with offices and trying to secure FY14 and, more importantly, FY 15 funding to fully implement the
2008 Lacey Act amendments.
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This event will bring together primary producers, secondary manufacturers, wholesalers, distributors, and importers and exporters for the opportunity to establish relationships and develop future business. Anyone who works with or supplies goods and services to attending companies will also benefit from the opportunity to make contact with key people.
Green Building: A key Federation issue in 2013
was the promotion of wood and wood products as sustainable and energy efficient building materials. We
ended the year on a high note, after months of meetings and negotiations, the Department of Defense issued new
guidance regarding their green building policy that
accepts multiple green building certification programs allowing for greater inclusion of wood and wood
products in DOD building projects.
Kelly, project manager for a mechanical contractor,
told Session 2 of Turbo's Leadership Lab:
"In my second year of apprenticeship while working
for Wright Shuchart and Harbor in Longview, WA, I
was given a wonderful opportunity to broaden my
skillset, which has helped advance my career. The
general foreman on the project used me from time to
time on the 'dumb end' of the measuring tape or
elevation rod when he was setting shims on the anchor
bolt chairs we set to support the 3½" diameter, 5' tall
anchor bolts used in the high density pulp tanks that
were part of the Kymer Two Digester project.
"One week at apprenticeship school, we were
trained on levels and transit. The following week, as we
were getting ready to set up for some shots, he became
distracted in conversation with a
foreman. I decided to set up the
instrument for him. When he
checked it, it was perfect, so he
decided to teach me how to do the
survey and layout. Within a couple
of months, I was the chief surveyor for a $48 million
dollar project! Weeks later, we were laying out anchor
bolts for pulp tanks on the other side of the project. It
was stressful. As we set the bolts, they were pouring;
imagine being on the inside of a double rebar matt as
the concrete is coming towards you!
"I had my state of the art Wild Theodolite
instrument, complete with optical plumb, set up in a
ribboned-off area to protect my survey hub. It was an
expensive unit, costing upwards of $10,000 dollars.
"I needed to go to the prints to confirm a
calculation. When I came back, I couldn't see through
the lens. The lens was completely shattered and laying
on the ground. The adjustment plate was bent at an odd
angle and it was apparent that the instrument had gone
down hard. I went directly to the office to let them
know what had happened.
"The PM, an old Russian fella named Val, was just
walking onto the job site. I said, 'I was setting the bolts
at the HI Tank, went to my print, and when I came
back, the Theodolite was toast, knocked over and set
back in place.' All he heard was that the Theodolite had
gone over. 'GOSH DARNIT!!!' (cleaned up), 'GOSH
DARN IT!!! NEXT TIME ONE OF THOSE GOES
DOWN, I WANT YOU UNDER IT AND I WANT
BLOOD, GOSH DARNIT!!!! I felt crushed! As he
was walking away, he stopped, took a moment to
reflect, gave me a wink and a smile, telling me it would
be alright.
"At the end of the pour, the concrete pump operator
came over to tell me what happened. He told me the
Laborer Foreman backed up a concrete truck next to my
instrument, let go of the chute, and the chute swung into
my instrument, knocking it down. When I asked him
about this, he said he didn't know what I was talking
about and the laborers under his lead didn't want to
jeopardize their jobs.
"The lesson I learned from this experience is that I
don't want to be 'that person;' I want to have integrity
and honor as I go through life; to look forward, not
backward; to own up to my actions and do what I can to
make them right. When my team members make
mistakes, I tell them, 'It is not our mistakes that define
us, it is how we respond to them. Respond to them with
honor and integrity and do all you can to make them
right.'
"The action I call you to take is to live your life 'on
the square' with honor and integrity - when you blow it,
show it. Don't allow someone else to take the
responsibility for your actions; own up to them and do
the best you can to make them right. The benefit you
will gain is an anchored sense of integrity and the deep
respect of others." Larry Dennis is the founder of Turbo Leadership Systems, an
executive team building and leadership skills development
organization. For more information about his programs, please visit
www.turbols.com.
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