U.S. lumber group criticizes tariffs

ITC also examines dispute's impact

A FTER nine months of studying la,the impact of a 2l .2Vo tariff on Canadian softwood lumber, some U.S. lumber producers are saying the tariffs may have been a mistake.

The Coalition for Fair Lumber Imports, which originally supported a tariff on Canadian imports. is now suggesting alternative proposals.

"The Coalition is changing its attitude," said western region vice-chair Dick Bennett. "At this time, we are looking for a volume restraint. The old Softwood Lumber Agreement, or a renewed version of it. is starting to look pretty good right now."

Under the old agreement from 1996 to 2001, Canada imported 14.7 bd. l-t. of lumber before incurring a duty.

"We have to do something to keep our industry alive and right now we are getting killed," said Bennett.

On the Canadian side, the duties have been "a catalyst for dramatic change in our industry," according to John Brink. owner. Brink Forest Products, Prince George, B.C.

Brink said the tariffs have forced his firm be more efficient. Brink's Prince George plant recently underwent a $2 million expansion so that it can produce 2x4s 24 hours a day, seven days a week.

It is precisely this kind ofenergetic production, particularly from British Columbia, that has U.S. producers looking to put a cap on the volume of Canadian softwood imports.

Canadian forestry minister Mike de Jong has said that he is open to a new lumber deal. but he will not consider the idea of a quota as suggested by American producers.

Steve Crombie, International Forest Products, Vancouver, B.C., reiterated that quotas were unacceptable. "We've been saying all along that the U.S. wasn't really interested in policy reform in Canada," he said. "They simply wanted to restrict supply coming into the U.S."

The U.S International Trade Commission also weighed in on the dispute last month by holding hearings on the impact Canadian softwood lumber tariffs have had on lumber dealers, builders and home buyers.

The ITC, whose hearings focused on the competitiveness of the U.S. structural building components industry, surveyed homebuilders, lumber dealers, and other interested parties from the structural building components industry.

The domestic anti-tariff coalition, American Consumers for Affordable Housing, whose members include Home Depot and the National Lumber & Building Material Dealers, among others. told the commission that the 27Vo duty on Canadian imports is hurting consumers.

"The imports are not just on lumber users; the current duties amount to a federally imposed sales tax on new home construction, remodeling and other applications for lumber," said ACAH spokesperson Susan Petniunas. "It is a tax on homebuvers and homeowners."

CANADIAN lumber imports belween May and November ol last year increased 1.86%, while produclion was up 6.7% over the previous year

To date, over 100 members of the U.S. House and Senate have written to President Bush asking his administration to drop the tariffs and open up free trade.

This past summer, the World Trade Organization found that the U.S. Department of Commerce's countervailing duty was contrary to from January to September. Instead of tariffs, U.S. producers now suggest quotas on Canadian imoorts are needed.

U.S. trade rules. and should be amended.

The ITC is expected to submit its findings to the Senate Finance Committee in April.

Despite the tensions, both Canadian and American officials have hinted that negotiations are expected to begin again soon.

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Kerr-McAgee Exits Treating

Kerr-McGee Chemical plans to exit the forest products business and close four of its five creosote treating plants.

The Oklahoma City, Ok.-based firm will close its Columbus. Ms.. plant by the end of 2003 and its Texarkana, Tx., operation by the end of 2004. A plant in Illinois and another in Missouri will be closed over the next year.

Kerr McGee leases a fifth plant to Union Pacific Corp. in Oregon, and its disposition is the subject of ongoing discussions.

"Exiting the forest products business is consistent with Ken-McGee's strategic plan to profitably grow our two core businesses, oil and gas exploration," said Kerr-McGee's Pete Woodward.

The company estimates that the closing of all four plants will cost approximately $13 million (after taxes).

Arson Strikes Florida Dealer

Local fire officials have determined that a fire last month at Frank's Cash and Carry, Freeport, Fl., was arson.

The Dec. 8 blaze destroyed Frank's warehouse. but soared the retail build- ing, which opened the following day.

Fire officials say an arson detection dog discovered an accelerant used to start the fire.

"It's a set fire," said fire marshal Tommy Barron. "Definitely arson."

The warehouse contained lumber, plywood, insulation and several gallons of latex paint.

Store owner Frank Schissler said he will rebuild the warehouse.

Bush Proposes Thinning Plan

The Bush Administration is pushing a new national forest thinning plan that seeks to change the manner in which environmental oversight is handled by the U.S. Forest Service.

Areas designated for thinning will still have a mandatory initial environmental analysis, but it will not be as comprehensive as cuffent Clinton-era regulations call for.

In addition, the plan seeks to narrow the timeframe for environmental impact statements, restrict administrative appeals to only those people or groups that raised objections at early hearings on thinning projects, and eliminate specific standards and procedures for maintaining and monitoring wildlife populations.

Bush Administration officials say the measures are necessary to counter groups who use the appeal process to delay timber projects they are opposed to.

Environmentalists contend that the Bush plan is an effort to eliminate citizen oversight of forest decisions.

"(The measures) are nothing more than the Administration's typical desire to cut the public out of forest decisions," said the Wilderness Society's Mike Francis.

Arkansas Yard May Expand

Pine Creek Lumber, Clifty, Ar., may add a lumberyard on a former illegal solid waste transfer station near Farmington, Ar.

Pine Creek owner Don Anderson acquired the 6-acre site and has since begun cleaning refuse from the property as required by a district court ruling.

In May, Anderson bought the property from Mel Romine, who pleaded "no contest" to county charges that he had used the site as an illegal waste transfer station.

Anderson, who also operates a propane distribution facility east of the new property, said that if he does open

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Fax a new lumberyard, it would most likely be a couple of years from now.

Despite the caution, Anderson adds that a lumberyard would ideally suit the area.

"We have lots of friends and customers (in western Washington County)," said Anderson. "And the location is great-in the middle of Prairie Grove. Lincoln and Farmington."

Depot Adds Self-Checkout

Home Depot stores are now installing self-checkout stations as part of an overhaul of the chain's front-end checkout technology.

The most innovative aspect of FAST (Front-end Accuracy and Service Transformation) involves the installation of four self-checkout stations at 300 of Depot's highest volume stores by year end.

Next year the Atlanta, Ga.-based retailer is expected to install the stations at 500 more stores.

"FAST will significantly improve the speed, accuracy and service levels at the checkout counters for millions of Home Depot customers," said Depot's Troy Rice.

In addition to the self-checkout sta- tions, Home Depot has partnered with NCR Corp. and Microsoft to reduce time, improve accuracy and enhance cashier performance at its traditional checkout counters.

Features of the new technology include:

. point-of-sale terminals with touch-screens featuring graphics to speed-up cashier efficiency,

. performance software to evaluate a cashier's skill against company standards, a new operating system to manage all point-of-sale devices, and streamlining media capabilities for training employees.

Company spokesperson Don Harrison said the move was not an attempt to eliminate staff.

"Nobody is losing a job or being displaced as a result of this," he said. "Will it mean a shift toward more part-time work? I don't know."

Approximately 60Eo of Home Depot employees are full time.

EPA Sued To Expand CCA Ban

Environmentalists have filed suit against the Environmental Protection Agency to increase the scope and speed of the wood treating chemical phase-out.

In the U.S. District Court of Washington, D.C. suit, Beyond Pesticides and the Communication Workers of America claim that the EPA has sufficient evidence to ban the use of CCA, pentachlorophenol, and creosote.

Last February, the nation's largest wood preservative manufacturers agreed to discontinue selling CCA for non-industrial wood products by the end of 2003.

Gibson's Closing Tx. Stores

Gibson's Discount Centers plans to shutter its Texas hardware stores this month as part of the closure of l7 stores in six states.

The Kansas-based retailer will close its Texas locations in Perryton, Weatherford, Kerrville and Vernon.

Chaffin Acquisitions, which acquired the chain in 1999, said the stores were not meeting sales expectations.

"Most of the communities that we operate in are ag-based communities, and with the drought and the stock market, the stores have not been able to meet out business plan," said Gibson's Ron White.

Hankins Shuts Down Ms. Mill

Hankins Lumber Co., Elliott, Ms., has closed its Quitman, Ms., sawmill, but had hoped to sell the venerable facility.

The layoffs began in late November, and the facility shut down in mid-December.

The sale, to an as-yet-unnamed buyer, was expected to close Dec.27, according to Jerry Pegg.

Hankins continues to operate its Grenada sawmill and planer in Elliott and a planer mill in Winona, Ms.

ABC Buys 29 Cameron DCs

ABC Supply Co. has acqtired 29 distribution centers in the MidAtlantic and Western regions from Cameron Ashley Building Products, Greenville, S.C.

The locations are all "one-step" distribution centers that sell roofing, siding and related exterior building products directly to contractors.

"This acquisition is a significant step within our current growth plans. We will continue to add stores in select markets while expanding product lines," says David Luck, president and chief operating officer of ABC Supply. "The new locations enhance our ability to provide contractors with thorough and consistent distribution coverage throughout the country."

New Mid-Atlantic markets include Cheverly, Frederick and Waldorf, Md.; Manassas and Richmond, Va., and Washington, D.C.

Thirteen of the new facilities will be consolidated with exisiting ABC locations, giving ABC 16 new sites for a total of 239 locations in 44 states.

The Cameron location in Alexandria. Va.. will be consolidated into the local ABC facility, while the Linthicum, Md., unit will merge with ABC's Baltimore, Md., DC.

ABC locations in Fredericksburg, Va., and Rockville, Md., will be consolidated into local Cameron Ashley facilities.

Based in Beloit, Wi., ABC Supply reportedly is the largest wholesale distributor of roofing and siding in North America, with annual sales exceeding $1.5 billion.

New Lumber Pricing Service

Bloch Lumber has introduced a new free service that provides fixedforward pricing information for forest products producers, distributors and manufacturers.

The new program, B loch Benchmarks, is designed to indicate the "fair value" pricing of key lumber and OSB items for periods of three months, six months and one year into the future.

"The benchmarks are not forecasts, nor are they offers to buy and sell," said Bloch Lumber's Gregg Riley. "They are estimates based on a quantitative analysis of current market conditions and prices."

Riley went on to add that the service indicates "the price at which one might reasonably want to buy or sell a particular item for the next three, six, or l2 months."

Bloch hopes that the service will assist companies when developing long-term budgets or trying to manage the risk of volatile lumber prices.

Bloch Benchmarks is located on the company's Web site at www. blochlumber.com.

Wheeler's Buys Competitor

Wheeler's, Inc., Rome, Ga., has purchased LBM dealer General Supply Co., Marietta, Ga., from longtime owner Gary Wigington.

The l7-unit chain has since closed General Supply's Canton Highway location and will serve its customers from its other metro Atlanta stores.

Wigington has joined Wheeler's as North Metro regional manager.

USG Enlarges Md. Plant

United States Gypsum Co. has expanded its cement board manufacturing plant in Baltimore, Md.

U.S. Gypsum expanded its cement board line by 90,000 sq. ft. to manufacture Durock, its new brand of cement board.

"The new line at the Baltimore plant will help U.S. Gypsum serve the needs of our East Coast cement board customers well into the future," said USG Corp.'s James Metcalf.

U.S. Gypsum operates other cement lines in New Orleans. La.. Michigan and California.

United States Gypsum Co. is a subsidiary of the USG Corp.

Court Upholds Roadless Ban

Last month a federal appeals court overturned a preliminary injunction by Boise that effectively reinstates the Clinton-era ban on new road building in remote U.S. forest areas.

The Dec. l2 decision by a San Francisco, Ca., appeals court overturned an Idaho court ruling in favor of Boise, which needs to build roads for its heavy logging equipment.

In its ruling, the court found that timber removal and road construction in designated remote forests would damage "some of the last unspoiled wilderness in our country."

Idaho Governor Dirk Kempthorne said he will ask the U.S. Justice Department to review the decision "to make sure this ill-advised roadless rule is not implemented."

The Clinton plan covers 58.5 million acres of federal land and prevents road construction and the removal of timber and oil except for environmental reasons or to reduce wildfire risk.

Future Hardwood Trees

Scientists in Indiana are hoping that classical breeding and biotechnology will soon lead to a superior hardwood tree for use by the flooring and furniture industry.

The goal ofresearchers at Indiana's Purdue University is to breed superior black walnut, black cherry and northern red oak trees that are faster growing, richer-grained and more disease resistant than their unmodified peers.

"If we can domesticate hardwood trees, that means you can eventually leave the wild ones where they are because you've made something that is better," said molecular biologist Keith Woeste.

Using grafted limbs from 400 different trees, researchers are now crossbreeding the most desirable black walnut trees at Purdue's experimental tree farm. In addition to grafting, scientists are genetically modifying select trees by inserting genes into embryonic trees with desirable qualities like insect resistance.

Another goal is to develop a tree that is resistant to the herbicides foresters spread over tree fanns to kill competing plant and tree vegetation.

The ultimate aim of the program is to increase the yield of hardwood timber in the U.S. It is estimated that there is an annual shortfall of 55 million hardwood seedlings a year.

Ninety percent of the U.S.'s hardwood production now comes from pri- vate forests that are less than 100 acres in size. In these forests, the biggest and healthiest trees are harvested first, leaving behind a stock of smaller, sicker trees.

"The overall picture has been that the trees that are being harvested now are smaller that they were 50 years ago," said National Hardwood Lumber Association's Paul Houghland Jr. "And smaller trees mean you need more of them to get the same amount of lumber." lf you ore o deoler or distributor of Southern Pine lumber products, odd your compony to our directory so thot interested buyers con find you! The listing is FREE, ond signup is eosy. Just go to www.southernpine.com/signup. htm.

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Dan Carver has been promoted to v.p.-purchasing at Builders FirstSource. Dallas. Tx. He succeeds John Gunn, who has resigned. Greg Bolig, ex-Bird Vinyl Products and CertainTeed Corp., has been named v.p.-sales for the company's Southeast Group.

Joe Flemming, ex-Birmingham International, has opened MadWood Lumber, Birmingham, Al. Shane Dobbs has joined the company.

Alan Thielmann is the new v.p.-marketing at Georgia-Pacific Corp., Atlanta, Ga. Mike Cousin has been named v.p.-planning and technology-building products.

Burton M. Judson III is the new Matthews International Corp. sales representative for Virginia, North Carolina and Maryland.

Harry Finney, lumber buyer, Foxworth-Galbraith Lumber Co., Dallas. Tx.. retired Dec. 31 after 11 years with the company and 55 years in the industry.

David Allen has joined Bill Roberts Sales, Dallas, Tx. He will be opening a new sales office in Monroe, La., to serve Arkansas, Louisiana and Oklahoma.

Ryan M. Puckett has been appointed mgr.-media relations at the Ponland Cement Association.

Jack Peddy has retired from International Paper's engineered wood products division and formed Peddy & Associates, Concord, N.C.

Joe Izganics has been promoted to president of Home Depot's Services division, Atlanta, Ga.

Donald Scheibenreif has been named director of field marketing and sales promotion at TruServ Corp.

W. Lee Nutter, chairman, president and c.e.o., Rayonier Inc., Jacksonville. Fl.. received the Marco Polo Award from the Chinese government for the firm's 25-year business relationship with the country.