developing infrastructure for growth in trade de la roche.pdfus wood furniture imports other canada...

Developing Infrastructure Developing Infrastructure

for Growth in Tradefor Growth in Trade

Ian de la Roche

Doing Business with ChinaMay 23-24, 2006

Vancouver, Canada

“Research for the Wood Products Industry”

•• Global TrendsGlobal Trends•• Research Needs and OpportunitiesResearch Needs and Opportunities•• Growing the PieGrowing the Pie•• Developing InfrastructureDeveloping Infrastructure

Outline of PresentationOutline of Presentation

ForintekCanada Corp.


The Changing WorldThe Changing World

““New Rules & New Business ModelsNew Rules & New Business Models””


Courtesy of A. G. Raymond & Company

China as a CompetitorChina as a Competitor

US Wood Furniture Imports

Source: Global Trade Atlas

0

2

4

6

8

10

12

14

16

US Dollars

Billions

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

US Wood Furniture Imports

OtherCanadaChina

ChineseChinese--Russian BorderRussian Border

Source: Kent Weiler

RussiaRussia’’s Timber Industrys Timber IndustryAllowable vs. Actual Timber HarvestAllowable vs. Actual Timber Harvest

0100200300400500600700

85 90 92 94 96 9820

0020

02

Harvest AAC

Million cubic meters

Source: R. Taylor, WMM Feb 2003; UN/ECE

potential for production & export


Global Plantation TrendsGlobal Plantation Trends

Summary of Plantation Trends (million mSummary of Plantation Trends (million m33) ) 20002000--2050 (Source, Brown 2000)2050 (Source, Brown 2000)

CountryCountry 20002000 20102010 20202020 20502050

30301818101025251010

001251251515

40402828181825252727

001501505555

62625050303042424646

33223223

??

929271716868646425253333

330330??

BrazilBrazilChileChile

IndonesiaIndonesiaNew ZealandNew Zealand

RussiaRussiaSwedenSweden

USAUSAChinaChina


INFORMATION & INFORMATION & COMMUNICATIONSCOMMUNICATIONS

REVOLUTIONREVOLUTION




1. Inventory1. Inventory

2. Cash Cycle2. Cash Cycle

3. Growing the Brain3. Growing the Brain•• LearningLearning•• Data salesData sales

SupplierSupplierBankBank

Technology and Supply Chain

Store


... ... Business has ChangedBusiness has Changed

•• It is global.It is global.•• It is knowledgeIt is knowledge--based.based.•• It requires products with attributesIt requires products with attributes

valued by the customer.valued by the customer.

Adding Knowledge is Adding ValueAdding Knowledge is Adding Value


Increasing Value Added

Compete on raw material,Compete on raw material,energy, labor, marketenergy, labor, market

access.access.

Cost MinimizingCost MinimizingR&D < 1%R&D < 1%

Compete on promotion, Compete on promotion, brandingbranding

and distribution.and distribution.

Sales MaximizingSales MaximizingR&D > 2%R&D > 2%

Performance MaximizingPerformance MaximizingR&D R&D << 10% (of Sales)10% (of Sales) Compete on R&D, Compete on R&D,

knowledge andknowledge andpeople.people.

BusinessStrategies & R&D Investment

BusinessStrategies & R&D Investment

Adapted from Binkley and Forgacs


TIME

RESOURCES

GLOBAL NATURAL

IndustrialRevolution

ElectronicRevolution

Agriculture &Domestication

Hunter &Gatherer

KnowledgeRevolution

GLOBALPOPULATION

GROW

TH


If you want one year of prosperity, grow If you want one year of prosperity, grow GRAIN.GRAIN.If you want ten years of prosperity, grow If you want ten years of prosperity, grow TREES.TREES.If you want 100 years of prosperity, If you want 100 years of prosperity, grow PEOPLE.grow PEOPLE.

Old Chinese ProverbOld Chinese Proverb

ForintekCanada Corp.


The Power of PartnershipsThe Power of Partnerships

Winner: Veneer Drying TechniquesWinner: Veneer Drying Techniques

Forintek Canada Corp. Research TeamForintek Canada Corp. Research Team




http://www.cobalt.chem.ucalgary.ca/group/IMAGES/Earth.Day.jpg

Buildings are responsible for:Buildings are responsible for:40% of the world’s consumption of energy and materials

34% of the world’s CO2 emissions

40% of the world’s solid wastein landfills

17% of the fresh waterconsumption


Steel-frameSteel-frame Insulated concrete formInsulated concrete form

Wood-frameWood-frame

How Do These Materials Compare?How Do These Materials Compare?


xxxxEmbodied Embodied

EnergyEnergyGlobalGlobal

warmingwarmingPotentialPotential

AirAirToxicityToxicity

WaterWaterToxicityToxicity

WeightedWeightedResourceResource

UseUse

SolidSolidwastewaste

Wood DesignSteel DesignConcrete Design

Comparing Comparing wood, steel wood, steel and concrete and concrete in a typical in a typical house design:house design:

The Real Measure of The Real Measure of Environmental ImpactEnvironmental Impact


•• Softest environmental footprint.Softest environmental footprint.

•• Renewable Renewable -- a cut tree can be grown again.a cut tree can be grown again.

•• Grown with solar energy.Grown with solar energy.

•• Absorbs carbon dioxide while growing.Absorbs carbon dioxide while growing.

•• Traps carbon dioxide until burned or decays.Traps carbon dioxide until burned or decays.

•• Recyclable and biodegradable.Recyclable and biodegradable.

•• Minimally and cleanly processed into lumber.Minimally and cleanly processed into lumber.

•• Better insulator than concrete and steel.Better insulator than concrete and steel.

The Wood Environmental ScorecardThe Wood Environmental Scorecard


To a Sustainable FutureTo a Sustainable Future

Sustainable Forestry

Environmentally Friendly Construction

Energy Self Sufficient Manufacturing

Renewal Energy


http://www.cobalt.chem.ucalgary.ca/group/IMAGES/Earth.Day.jpg

Increasing Demand for WoodIncreasing Demand for Wood

Maintaining existing markets and growing new markets


A lot of eggs in one basket: US residential constructionA lot of eggs in one basket: US residential construction

90% of all lumber exports

US and Canada Residential:

Already saturated. Nowhere to go but down.

Termites, rot, fire, hurricanes, insurance, volatile lumber prices = more concrete. Steel also nudging up.

Non-Residential Buildings:

Almost as big a market as residential, but hardly tapped by wood.

Sources: US Census Bureau, Statistics Canada, WPC/FS 2005

New Construction, 2003 - US and Canada

0

0.2

0.4

0.6

0.8

1

1.2

Construction value

Wood volume

ResidentialNon- Residential

Target growth

Up to 6 billion board feet more lumber

Population Growth by 2030: an additional 3 billion people will need shelter. This translates into 96,150 units per day.

If 20% were wood frame and extremely modest in size, this would translate into 18 billion BF of lumber and 7 billion ft² of panel products.

Population Growth by 2030: an additional 3 billion people will need shelter. This translates into 96,150 units per day.

If 20% were wood frame and extremely modest in size, this would translate into 18 billion BF of lumber and 7 billion ft² of panel products.

Sustainable Shelter Solutions

Source: Global Report on Human Settlements 2005

Sustainable Shelter SolutionsSustainable Shelter Solutions

The Old China The New ChinaThe Old China The New China

The New ChinaThe New China

• Housing investments to grow by 7% annually

• China will build ~ 500M m2 of residential housing each year over the next 20 years

• Potential for wood in single and multi-family construction???


“““Research for the Wood Products Industry”

Platform Frame Technology Platform Frame Technology

Evolution Toward Mixed Systems(Steel / Concrete / Wood)

Evolution Toward Mixed Systems(Steel / Concrete / Wood)


8 1992

2-level under groundparking

4-storey steel-concretecommercial & retail

4-storey wood frameliving units withsprinkler and fire-retardant exterior walls

142 apartmentsAMC 16 theater37400 SF retail shops & restaurantsSimilar project across the street


Pine Square/Pacific CourtPine Square/Pacific CourtLong Beach CALong Beach CA

Vancouver:Roof in Multi-Storey Building

Shanghai: Attic Storey

Stockholm: Wood Top-Storey on Concrete Building

Scotland: Roof of an old church. It made sense then, it makes sense now.

WoodWood’’s high strength to weight ratio makess high strength to weight ratio makesit very suitable for roof applicationsit very suitable for roof applications

Research to Ensure Performanceof Building Systems and Assemblies

Research to Ensure PerformanceResearch to Ensure Performanceof Building Systems and Assembliesof Building Systems and Assemblies

Attribute AnalysisAttribute Analysis

Structural Performance Fire SafetyDurability



Alaskan EarthquakeAlaskan Earthquake

Performance - SeismicPerformance - Seismic



Global Disasters Attract Our AttentionGlobal Disasters Attract Our Attention

August 17, 1999 Earthquake

- Turkey: 120,000+ homes



September 21, 1999Earthquake

- Taiwan: 13,000+ homes



October 8, 2005 Earthquake

- Pakistan: 500,000+ homes



December 26, 2004 Earthquakes & Tsunami

- Indonesia: 100,000+ homes- Sri Lanka: 50,000 +- Thailand: 3,800

A ready client with funds and motivation:International aid agencies.

Big market demand: 1 million homes each year lost to natural disasters.

September 2005 Wood SeminarsSeptember 2005 Wood Seminars

Seminar in Banda Aceh“Research for the Wood Products Industry”

September 2005 Wood SeminarsSeptember 2005 Wood Seminars


Seminar in Jakarta


Meeting with President &

Residents of Labui Village

Dialogue at Village LevelDialogue at Village Level

• Security of supply• Sustainable forestry• Engineering expertise• Proven safety and durability• Quick and easy to build• Easy to modify

Ready-to-assemble, Canadian-branded house kits.

Pre-cut, pre-treat and possibly panelize in Canada. Ship as a ready-to-assemble kit.

Demonstration ConstructionDemonstration Construction


Indonesia: springboard to a huge global market.

Vision

“Meeting a global need for shelters that are safe, affordable,

attractive, healthy and environmentally friendly.”

“Growing the Pie in Wood Growing the Pie in Wood ConstructionConstruction””


A Balanced, Multi-path Strategy


But how?But how?

Industry-led promotionMarket intelligence Applied research Regulatory advocacyEnd-user assistance


Thank you for your attentionQUESTIONS?

Thank you for your attentionQUESTIONS?

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