WOOD BIOENERGY

WOOD BIO WAS INFO BLITZ Atlanta conference covered all the bases.

ATLANTA, Ga. T wenty-eight speakers, 46 equipment exhibitor companies, and three university exhibitors participated in the sixth Wood Bioenergy Conference & Expo held March 10-11 at the Omni Hotel at CNN Center. Attendance, including speakers, exhibitor personnel, producers, consultants and academia, hit 200. The event was hosted by Wood Bioenergy magazine and Georgia Research Institute.

In his talk Partnering for Growth, Scott Bax, chief operating officer of Pinnacle Renewable Energy, provided an over - view of Pinnacle’s aggressive expansion into industrial wood pellets, noting its nine existing pellet production facilities in North America, and two others under construction—one in High Level, Alberta, Canada and the other in Demopolis, Ala. in the Southeast U.S.

Several of these are partnership arrangements with wood products companies, including the new plant in Alberta with Tolko Industries and the new one in Demopolis with Westervelt and Two Rivers Lumber. Pinnacle, Westervelt and Two Rivers have a similar arrangement

Scott Bax

There was a lot said that was worth hearing about the state of the wood bioenergy industry.

for an existing plant in Aliceville, Ala.

Bax said upon the completion of the two new plants, Pinnacle will have an annual production capacity of 2.83 million metric tons.

Bax focused on Pinnacle’s approach to its partnerships, citing common goals, honesty and transparency, clear expectations, room to grow, “owning safety,” and the importance of leveraging each other’s strengths.

Referring to the Westervelt and Two Rivers partnership, Bax said all the parties share a strong common value of safety. Pinnacle entered that partnership in 2018 at the existing Aliceville pellet mill, which is in the middle of a $10 million capital expenditure program. The new Demopolis mill will produce 360,000 MTPA with production commissioning expected in the second quarter of 2021. The majority of the wood fiber will be delivered from the adjacent Two Rivers sawmill. Westervelt’s new sawmill under construction at Thomasville, Ala. will also provide fiber.

The partnership with Tolko on the new 200,000 MTPY facility at High Level represents an expanded relationship, stemming from the two companies’ partnership at the Lavington, BC pellet mill that started production in late 2015 with a production capacity of 300,000 MTPA.

“Discussions with strategic partners, existing and new, are ongoing,” Bax added.

HURRICANE MICHAEL

Devon Dartnell, director, market analysis and research, Georgia Forestry Commission, spoke on Hurricane Michael’s Impact on the Forest Resource. He noted several things that worked in favor of the post-storm salvage effort, including that GFC organized an immediate meeting with mills, timber producers and the Florida Forest Service. He said wet storage capacity was added at some mills such as

Rex Lumber and Canfor; producers focused on high value timber first and pulpwood tracts were postponed; log truck weights increased to 95,000 lbs. GVW and permits were issued for wet decks; logs were barged to south Alabama for additional sawmill capacity; producers came in from the north and west to add logging capacity; the wet winter made salvage difficult but extended utilization lifespan and it prevented mill quotas; and loggers gave it their all in the most difficult conditions during the salvage effort.

Dartnell said while typical conventional logging costs are $9-$12 per ton, Hurricane Michael logging costs were $15-$25 per ton due to the arrangement of wood and because trucking costs also went up. Harvesting challenges were plentiful: the cut down machines first had to access into the damaged stand; snapped off stems required the skidder to pick up individual trees; sawmills would not accept diagonal cuts at the butt or top end; splits, knots and

Devon Dartnell

stresses were worse from Michael than less powerful storms; some mills took only leaning trees because of shake, splits and loose knots.

Dartnell said future challenges are numerous: timber supply is severely depleted in the path of the storm; mills are having to truck logs farther. With 1.35 million acres severely or catastrophically damaged in Florida and 370,000 acres in Georgia, reforestation contractors and seedling nurseries will be sold out for years and require more than a billion seedlings.

IN THE WOODS

Danny Dructor, executive vice president of the American Loggers Council, spoke on the Health of the Logging Ranks and Staying Ahead of Environmental Encroachment. Dructor said ALC and its members appreciate the promotion of wood for bioenergy, whether in the form of a pellet, biochar, cogeneration or biofuels, because it pro

Danny Dructor

vides new markets to participate in.

Environmentally, he said most loggers just keep doing what they have been doing for most of their careers, practicing sustainable harvesting practices that includes caring for the land, the flora and fauna on the landscape, and taking pride in their professionalism and ability to overcome change.

He noted that environmentalists have taken well intentioned laws such as the National Environmental Policy Act, the Endangered Species Act and the Clean Water Act and have abused them in liberal courtrooms and negotiated settlements with federal agencies as a means to paralyze the industry, especially on federal lands.

“We have also seen attempts by those such as the Dogwood Alliance to stymie operations of private lands through a host of misinformation meant to stop the wood energy markets from developing,” Dructor said.

Dructor said more than 26,500 American environmental groups collected total revenues of more than $81 billion from 2000 to 2012, according to The Giving USA Institute. He said The Nature Conservancy, Greenpeace International, Wildlife Conservation Society, World

Wildlife Fund are the biggies in annual collections, followed by the Sierra Club Foundation, Environmental Defense Fund, Natural Resources Defense Council and the National Audubon Society.

Dructor recommended two books authored by Ron Arnold and Paul Driessen that “follow the money trail and corruption that exists between environmental organizations, our government, and those that benefit the most from the implementation of environmental regulations.” One is Undue Influence and the other is Cracking Big Green to Save the World from the Save-the-Earth Money Machine.

Dructor reported on the results of the ALC 2019 Logger Survey, which received 580 responses nationwide. He said (pre COVID-19) nearly 35% of the loggers indicated they were financially worse off than they were a year ago and 16% were better off. A whopping 97% said it is virtually impossible to replace or add new hires to their operations, and 73% said the wages and benefits were not sufficient to attract the right kind of workers to the industry.

Loggers ranked finding quality drivers,

trucking rates and insurance costs as the three most important impacts in being able to move wood from the landing to the mill. Insurance, equipment costs, trucking and labor ranked one through four on the list of increased operational costs.

With a choice of seven items, another question asked loggers to rank to what extent landowners or mills (or the clients they work for) valued those seven items: Low logging costs scored highest, followed by consistent production, high production, safety, environmental quality, professionalism and certification.

TIMBERLAND TRENDS

Andrew Copley, senior analyst with Forisk Consulting, spoke on North American Timberland and Forest Industry Capital Investment Trends. He noted that the rapid rise of TIMOs (Timber Investment Management Organization) and REITs (Real Estate Investment Trust) as a major component of the private corporate landowner class in North America is mirrored by the decline of the vertically integrated forest products company.

He said that Weyerhaeuser’s REIT with 11,735,000 million acres is far and away the largest owner of timberland; it is larger than the four largest U.S. TIMOs combined. He said in 2019 about 1.6 million acres changed hands.

Focusing on southern pine timberlands, Copley said the average southern yellow pine plantation accumulated 2.4 tons of volume per acre per year in the late 1980s, and by 2016 that number had more than doubled to five tons per acre per year. “As a whole, we are growing much more wood on an acre of land today than we were 30 years ago,” he said. “There is still room for improvement; a well-managed SYP plantation can produce six to eight tons per acre per year.”

Abundant grade supply is one of the factors that has led to a massive influx of sawmill investment in the South. In 2019 Copley said firms in the South completed 10 sawmill expansions and five new sawmills began operations. This added 1.7 billion BF of capacity to the region. Firms expect to build or expand 21 mills in the South in the next two years. Southern softwood sawmill capacity should approach 23 billion BF by 2024, a gain of 17% in five years. TP

Andrew Copley