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No. 538 January 2014 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]
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 form the opportunity to
make contact with key people.
Online registration is available for sponsors, partners, exhibitors, and attendees.
www.westernhardwood.org
Our Sponsors & Partners
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Western Hardwood Association – 2014 and
Beyond
Oh! For the good old days, just half a decade or so
ago. When Western hardwood supply was good and
demand was great! The economy was doing better and
people had money to spend for housing, remodeling,
vacations, and recreation. Little or no thought was
given to lowering the nation’s credit rating, increasing
the nation’s debt, subjugating countless millions to
government handouts, and severely curtailing the
harvest of trees, a renewable resource, based on
insufficient, or at best, inconclusive science.
Now we are obliged to think about the economy and
the forest products industry if we are to survive. A
modest increase in demand in 2013 has continued and
consequential sales that began with the ever-so-slight
rebound in 2010-11. Each year the growth was a bit
better. 2014 should be a year that perpetuates the
modest gain. But if we don’t get our country’s debt and
spending habits under control, we might well see 2008
or even worse.
The Pacific Northwest is truly the wood basket of
the world. We have more growing stock today than we
had a century ago. But the problem is that while we
were harvesting, replanting, and managing our
timberlands for a sustainable yield, the preservationists
were equally aggressive passing rules and regulations
that restricted cutting trees for the sake of the
environment. We know this outcome was based on
flimsy science. We are suffering from restrictions on
public lands that would have us leave burned, downed,
and diseased trees to accumulate fodder creating some
of the worst fire seasons we have seen in the last 5
years. Just think, if the forest floor was clear of debris
* Welcome New Members
* Editorial
* Outlook
* Legislative Update
* Upcoming Events
* Get Motivated
* ICE
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.
we could supply the growing biomass industry and open
the forests to more recreation. All this, while keeping
the fish and wildlife propagating abundantly.
Also damaged by the onerous rules and regulations
are the industrial and private landowners, both large and
small. Between endangered species and outlandish
stream buffers in riparian zones, much of the timber is
not allowed to be harvested, and thus allowed to be
susceptible to rot, disease, and fire. We need to employ
good management regimes, something the landowners
know very well. So, if we allow the land to be managed
by those who know and care, we can supply the timber
demand and be good stewards of the land.
The WHA, along with the rest of the forest products
industry, will do its part to be efficient stewards of the
land into 2014 and beyond. We need a public climate
that is conducive to and amenable to a reasonable
amelioration of industry, economy and society. With
this we see a brighter outlook for the future.
We also see the necessity to work more closely with
the constituents of the forest products industry. We
need to provide more outlets for the sales of lumber and
value added products on a global basis. For this
purpose, the WHA and its numerous partners will
present the 2nd Annual Western Hardwood International
Convention & Exposition May 19-22, 2014 in Portland,
Oregon. 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.
Dave Sweitzer, Secretary/Manager
Western Hardwood Association
P.O. Box 1095, Camas, WA 98607
Hardwood suppliers
on the West Coast report upward trends. A
California source repor ted that the
general uptick in the economy is helping.
As a progressive company, they continue to
go after business which is another plus
factor for them.
A Washington contact said regarding availability
issues, “Whether you’re buying
domestically or internationally, we
have to buy out further now.” Lead
times have lengthened and you
can’t just call and expect product to
be shipped the following day.
Another supplier on the West Coast
commented, “The lumber market was
better overall in 2013 than in 2012. New
construction has been the primary factor.”
Market activity in Quebec was reported as robust
through late fall for most species.
Domestic grade lumber markets provided
for improved business results, noted
hardwood manufacturer contacts. In most
regions, the onset of winter has impacted
the log inventory. Some sawmills have
found it difficult to find supplies with the increased
export of logs overseas. Along with winter and the
holidays, and with year-end activities, it was expected
that log supplies to sawmills would be restricted.
In Ontario, business activity
continued to be stronger for hardwood
producers. According to contacts there,
mostly all major market sectors
experienced growth in 2013. Sales of
Canadian interior hardwood products such as kitchen
cabinets, mouldings, and furniture have increased with
the U.S. housing construction market improving.
China’s growing demand for hardwood logs, lumber
and products is fueling sales of hardwoods for many
producers and hardwood finished products
manufacturers. The hardwood sector is also getting
business from the industrial sector increasing demand
for pallet lumber and cants. Moving forward on
projects, the oil industry has increased its demand for
board road materials and other related products. It is
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expected, however, that these activities will slow
slightly through the holiday and winter season.
Strong industrial and low-grade markets have
been in the news since long before the grade lumber
market began to pull out of its recession. While much
of the hardwood lumber industry’s focus has turned to
grade lumber shortages and run-away prices,
competition for raw materials in the low-grade sector
has only intensified. And, just as rising grade lumber
prices are forcing manufacturers and end-users to
consider substitute species, some pallet manufacturers
may be reaching similar “tipping points.” –excerpted from
Hardwood Review Express
Manufacturing remains quite strong in the
United States, with output continuing to expand and
recovering from the falloff during the recession.
Chinese manufacturing activity contracted slightly for
the first time since July. Two indicators released in mid
-January support a more upbeat assessment of the U.S.
economy’s health. The Conference Board’s Leading
Economic Index (LEI) continued to expand in
December, rising 3.4 percent in the second half of 2013.
One of the stronger elements in this index was the new
orders component, particularly as measured by the
Institute for Supply Management’s (ISM) PMI reports.
Similarly, manufacturing was a significant positive
contributor to the Chicago Federal Reserve Bank’s
National Activity Index (NAI). This measure has
shown strong improvement in the past few months, with
overall growth now above its historical trend.—excerpted
from NAM Monday Economic Report.
Many forecasters predict U.S. GDP growth of at
least 3.0%this year. Housing market analysts don’t
expect existing home sales to show much improvement
in 2014, but most do expect new home starts to increase
by at least 25%. The Harvard Joint Center for Housing
Studies is forecasting double-digit year-on-year growth
in home improvement spending through mid-year.
Finally, the American Institute of Architects predicts a
15% increase in hotel construction this year, as well as
solid gains in office and retail construction.
Selected species outlook:
Alder - The stage is set for robust alder sales for the
foreseeable future.
Ash - Ash producers can expect brisk business in
the months ahead, especially to overseas markets.
Beech - Some manufacturers of wood components
and furniture may take a fresh look at beech as a
low-cost substitute.
Upcoming Meetings
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]
February 26, 2014 State of the States -Regional Assessment of Forest Health in Oregon & Washington Vancouver, WA Email: [email protected]
March 5, 2014 WHA Board Meeting Beaverton,OR Email: [email protected]
March 12, 2014 Washington Hardwoods Commission Meeting TBD Email: [email protected]
April 16, 2014 Access, Easements, Rights -of-Way and Timbre Trespass Springfield, OR Email: [email protected]
April 17 -18, 2014 Pacific Northwest Timberlands Management Portland, OR Email: [email protected]
May 19-22, 2014 2nd Annual Western Hardwood International Convention & Exposition Portland, OR Email: [email protected]
June 9 -13, 2014 The Basics of Forest Land and Timber Appraisal Corvallis, OR Email: [email protected]
September 25, 2014 Access, Easements, Rights -of-Way and Timbre Trespass Grand Mound, WA Email: [email protected]
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!
Cottonwood - The expanding economy won’t
provide cottonwood with as much of a demand
bump as other species because so much of it goes
into casket production.
Poplar - Domestic demand for poplar steadily
expanded in 2013, and exports were up 10% year-to
-date through November to set an annual record for
the fourth straight year. -excerpted from Hardwood Review
Express
The labor market was disappointing in
December, with just 74,000 nonfarm payroll workers
added in the month. This was well below the consensus
estimates of around 200,000 that was expected, and it
somewhat undercuts the storyline that the U.S.
economy was beginning to gain some momentum.
However, it is important to not make too much of one
month’s data, which might have been influenced by
weather and other factors. Nonfarm payrolls growth
averaged 214,000 in the prior four months (August to
November), and there is some thinking that December’s
hiring figures were a bit of an outlier. Indeed, the
participation rate fell once again to 62.8 percent,
matching what was seen in October, which was the
lowest level since February 1978. As a result, the
unemployment rate fell to a five-year low of 6.7
percent.
Meanwhile, manufacturers added 9,000 net new
workers in December, its fifth month of positive gains.
From August to December, the sector has averaged
16,000 additional hires each month. In contrast, the
average from March to July was a net decline of 8,000
per month. This is generally consistent with the pickup
in manufacturing activity that we have seen in other
economic indicators, even if the net job growth in
December was down from October and November.
The other big news of last week was the narrowing
of the U.S. trade deficit from $39.33 billion in October
to $34.25 billion in November. On the surface, this is a
positive development, with the decline in the deficit
coming largely from reduced petroleum imports. This
decrease corresponded to lower petroleum costs, as the
cost of West Texas Intermediate crude fell sharply
during that time frame. In addition, goods exports rose
to an all-time high, up from $135.61 billion to $137.01
billion.
More than 200 legislators, legislative aides,
and forest industry representatives gathered in Olympia
on January 28th to foster relationships. Several
Washington members of the forest products industry
sponsored the event, including the Washington
Hardwoods Commission. WHC’s purpose was to focus
on the recently completed Western Washington
Hardwood Inventory Assessment. The full report is
available on the WHC website,
www.wahardwoodscomm.com.
On January 29th, the House passed a long
awaited 5-year extension of the Farm Bill on a strongly
bipartisan vote of 251-166. The Bill will move on to
the Senate where it is expected to be passed as well and
on to the President’s desk for final approval.
Five Issues to Watch in 2014
1. Extending Expired Tax Provisions: Many
business tax provisions, such as the research and
experimentation tax credit, the active financing
exceptions under Subpart F, and expensing and
bonus depreciation expired on Dec. 31. The
business community will continue to press for
enactment of tax extenders early in 2014, but a bill
covering most of the extenders may not occur until
later in the year-possibly after the midterm
elections.
2. Leadership Change: Sen. Ron Wyden, (D-OR)
is expected to replace Baucus at Finance, while
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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.
Rep. Paul Ryan (R-WI) would replace Dave Camp
at Ways and Means when Camp’s chairmanship
ends this year, if the Republicans maintain control
of the House after the midterms. The political
landscape for tax-code revision will change to
reflect the goals of the new leaders.
3. Piecemeal Tax Legislation: Wyden's history of
proposing grand tax-overhaul plans suggests that
once the dust settles over the leadership change,
comprehensive revision will be back on the table
after the midterm elections.
4. Focus on Energy: Master Limited Par tnerships
(MLPs): The Joint Committee on Taxation
estimated that extending MLPs to renewable energy
investments would cost $1.3 billion over 10 years,
and $307 million over five years. Republicans say
that this MLP change would have to be paid for
with a reduction in other tax credits, namely the
renewable energy production tax credit -- a deal that
would likely be unacceptable to the renewable
energy industry.
5. Inflection Point at the Internal Revenue
Service: Newly appointed IRS Commissioner John
Koskinen has the opportunity to help repair the
IRS's damaged reputation over its management of
tax-exempt entities. Koskinen could usher the IRS
into an era of bolder business-tax oversight, which
could pose risks for companies in the form of
harsher enforcement, but could also benefit them
through improved legal certainty and a more
efficient regulatory process.
Mark, pipefitter superintendent for a Northwest
mechanical contracting company, told Session 9 of
Turbo's Leadership Development Lab (LDL):
"When we were given the 5X assignment at Session
3 of the LDL and asked to apply five times more
enthusiasm to a difficult or stalled, languishing project,
I decided to apply 5X more enthusiasm to the Lloyd
700 building design. I am working on this redesign
project with Glumac Engineering. In the past it has
seemed to me that some engineering firms have had a
difficult time hitting expected design delivery
dates. When these delivery dates are missed, it throws
the whole project off. We get the project contract late,
and the work is delayed. This affects our cash flow and
can affect the building's occupancy; no one is happy. In
the past when these delays have occurred, we have been
implicated as the party who caused the delay.
"This Lloyd 700 building project requires
demolition and then replacing most of the mechanical
equipment on the 17th floor of this
downtown Portland building. I went
to work with '5X more' enthusiasm
with the engineers to create as-built
drawings for the existing building's
layout, as well as all of the existing
equipment housekeeping pads. In
the ideal world, these drawings would have already
existed and been available to us. It isn't easy to go back
and recreate drawings of what is already in
place. These drawings of the existing equipment are
quite important. They will help us coordinate the
design and install of new equipment, and make the
install easier and faster. The building will have heat and
air conditioning restored for tenant comfort much
faster,and we will use these drawings to help in the
creation of 'as-builts' of the new system when we
complete the install. This will make future use and
maintenance of the new equipment much easier. In
addition to creating the drawings, I took it upon myself
to put these new drawing plans into an Auto CAD
design format and sent them to the Glumac design team
in an effort to speed up the process so we can get the
final engineering package back in a timely
manner. This will speed up the negotiation of our final
proposal.
"The lesson I have learned from using 5X more
enthusiasm on this project is that I need to go above
what is expected of me to achieve the results I expect
from others. The action I call you to take is don't settle
for just doing enough; instead strive to do more. Don't
be afraid to go above what is required of you to achieve
the results you are looking for. The benefit you will
gain is being in the driver's seat. You will get your
desired results and more. You will bring more business
to your firm, and earn the respect and cooperation of the
professional firms whose help you need to be
successful. You will strengthen your team's reputation
and your own." 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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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.