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Timber Talk 12/14/15

Posted By Gayla Fleming, Tuesday, December 15, 2015

Export Alert on Ash!
No doubt some have heard already, but AHEC announced a Trade Alerton the export of ash to the European Union. The European Union has imposed new rules on the import of ash from the United States and regions of Emerald Ash Borer occurrence. AHEC advises that the rules will be burdensome on U.S. industry. Briefly, new requirements indicate that ash will be accepted if it meets one of 3 requirements: (1) originates from a "recognized” EAB-free area; or (2) bark and at least 2.4 cm (1 inch) of sapwood is removed from an APHIS-approved facility; or (3) the wood has undergone ionizing irradiation to appropriate levels. Rules take effect January 1, 2016. AHEC advises that option 2 is the only realistic option to export ash to the EU. To comply with option 2, U.S. mills will have to sign a compliance agreement and have their compliance process with APHIS approved. It appears that the 2.5 cm sapwood rule will be strictly enforced by EU inspectors. AHEC is expressing strong displeasure with the rules and believes that APHIS did not adequately present evidence or make arguments for the benefits of kiln drying with control of EAB as well as concerns with the 2.5 cm rule on sapwood. AHEC believes there is opportunity to argue for a "systems” approach to controlling EAB on exported lumber with the EU and is working towards accomplishing that result. Stay tuned for further information.

Maintain Good Employee Training Records
OFA received an inquiry last week from a logging company involving an OSHA claim on training for employees following an accident. There was a serious accident involving a skidder and OSHA wanted evidence of appropriate training. One of the "take-away” messages from the review concerns the importance for owners to adequately document training that is provided to employees. Without appropriate documentation to verify that an employee had been trained, it is very difficult to claim training took place, even if it has and the operator was very good. A helpful documentto review concerning logging requirements is one developed by the Forest Resource Association (FRA) which is a companion guide to logger safety training designed to meet OSHA safety standards. To be certain that a company complies with the OSHA stated "content” requirements in training, training must meet the following (page 1 of document):

  • Safe performance of assigned work tasks;
  • Recognition, prevention, and control of hazards associated with the employee's specific work tasks;
  • Safe use, operation, and maintenance of tools, machines, and vehicles the employee uses or operates (including following manufacturers' instructions;
  • Recognition, prevention, and control of other logging hazards;
  • Procedures, practices, and requirements of the employer's work site;
  • The requirements in the OSHA Logging Operations standards (29 CFR 1910.266).

Moody’s Investors Service – Stable 2016 Outlook for Global Paper and Forest Products Sector on Increasing Home Construction
Moody’s Investors Service is predicting a growth of 1% - 3% in 2016 for the global paper and forest products industry, as summarized in this December News Release. This growth falls within its "stable” range. Moody’s expects a 0% - 4% growth in the Paper Packaging and Tissue segment while US housing starts will help increase demand for timber, lumber, oriented strand board and engineered wood products, with a stable outlook for the Wood Products/Timberland segment. Moody’s expects lower Chinese infrastructure spending to pressure lumber and log exports, with growth from 0% - 4%.

US Forest Products in the Global Economy
The US Forest Service Southern Research Station recently published the report, US Forest Products in the Global Economy, an analysis of the change in the US share of the global forest products market since 1990. As summarized in this articlefrom PHYS.ORG, although the US leads the world in both production and consumption of forest products, its global market share has dropped significantly since 1990. Declines in US construction and paper manufacturing have fueled the changes in market share. From a peak global roundwood share of 28% in 1999, the US share dropped to 17% in 2013. Changes in the US housing market have played a large role in the decline, but the report indicates if housing once again reaches prerecession levels, the US market share could expand to 22-24%.

October 2015 Housing Commentary from Virginia Tech
You can see the latest Housing Commentary from Virginia Tech at the link. The commentary has information on U.S. housing construction and remodeling activities and is intended to help view future activity. It contains information on housing starts, permits and completions, as well as sales information on new and existing home sales. There is also U.S. and global economic information.

JobsOhio Report to Board: 2015 to Finish "Very Strong”
In a report to JobsOhio Board members last week, Chief John Minor reported that the economic development group will track stronger results than the previous year. Without final numbers for the year, JobsOhio reported 421 projects this year with total investments of $254 million, with 54% funding from grants and 46% from loans. Another 413 projects involving 96,000 jobs and $20 billion in capital investments are in the pipeline. Many may remember that funding for JobsObio investments comes from taxes on liquor sales, and liquor revenues last quarter increased 7%. A recent economic development project expected to reap huge rewards for Ohio is one with the Italian company Sofidel, a "forest products” company that manufactures tissue paper. Sofidel is locating in Circleville on the site of the former RCA plant and is expected to employ 310 people once it fully opens in 2017.

Ohio Grace Commission Starts Work
Modeled after the original "Grace Commission” started under the Reagan Administration in the early 1980s to identify waste and inefficiency in the federal government , the Ohio legislature has authorized its own "Grace Commission” to accomplish essentially the same agenda with Ohio government. The Ohio body is composed of 12 members one from the Senate, one from the House and another 10 appointed members. The commission just recently gathered to start work and will report its findings by May 29, 2016. The commission is co-chaired by Rep. Kirk Schuring (R-Canton) and Sen. Bill Coley (R-Liberty Twp.). The work will be "fact-finding” according to Co-Chairman Coley and is not intended to develop specific legislation.

A Forest Carbon Future: A Report from the Forest Policy Forum
The Forest Policy Forum is a broad consortium of forest products industry stakeholders and industry participants, including associations such as the American Forest & Paper Association, the American Wood Council, and the American Forest Foundation; industry members like Weyerhaeuser and Plum Creek; and conservation groups like The Nature Conservancy. Using the research services of Dovetail Partners, the group developed a report: A Forest Carbon Future which summarizes and highlights the carbon benefits of managed forests and manufactured forest products. With all the attention surrounding the Climate Conference and regardless of how you may feel about the climate change issue, the report outlines the environmental benefits of forests and forestry. For example, with one out of 3 acres of land in America forested, the forests store 40 billion tons of carbon and add an additional 200 million tons of carbon each year. The forests are sequestering 12-15% of U.S. carbon emissions each year. It’s worth a look.

Interesting Note About a Polish Forest with Crooked Trees
This is just an interesting note that I wanted to share. I have a simple mind, and I find it interesting how the internet can immediately share information from around the world. This is a forestry note published on an Australian website about a unique stand of trees in a Polish forest. I received it via a newsletter developed in the western U.S. It’s brief, and I honestly share it only because it has pictures. Remember the simple mind… Here is the article.

2016 OFA Annual Meeting, March 9-10, 2016, Dublin Embassy Suites; "Ohio Hardwoods – Changes and Challenges”
Get the meeting date on your calendar. Plans are progressing for the annual meeting at the same location as last year. You recently received a request for nominations for OFA awards. Please consider nominating someone who has contributed significantly to forestry and OFA activities. They will be recognized at the annual awards luncheon

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