MarkMarkMarkMarkMarket Opporet Opporet Opporet Opporet OpportunitiestunitiestunitiestunitiestunitiesFFFFFororororor

Small Small Small Small Small WWWWWoodland Ownersoodland Ownersoodland Ownersoodland Ownersoodland Owners

WWWWWashington County Small ashington County Small ashington County Small ashington County Small ashington County Small WWWWWoodlands oodlands oodlands oodlands oodlands AssociationAssociationAssociationAssociationAssociation

December 2003December 2003December 2003December 2003December 2003

AcknoAcknoAcknoAcknoAcknowledgementswledgementswledgementswledgementswledgements

Many people have made significant contributions to thisdocument. The review and advice of the following people isgreatly appreciated:

John Belton

Richard Courter

Ned Hayes

Mike Heath

Chal Landgren

Scott Leavengood

Douglas Marshall

Neil Schroeder

Bob and Bonnie Shumaker

Wendell Walker

Gail Wells

TTTTTom Nygren,om Nygren,om Nygren,om Nygren,om Nygren, CF CF CF CF CF

Editor/authorEditor/authorEditor/authorEditor/authorEditor/author

WWWWWashington County Small ashington County Small ashington County Small ashington County Small ashington County Small WWWWWoodlands oodlands oodlands oodlands oodlands AssociationAssociationAssociationAssociationAssociation

The preparation of this document was funded in part with agrant from the United States Forest Service through Old GrowthDiversification funds administered by the State of OregonEconomic and Community Development Department.

MarkMarkMarkMarkMarket Opporet Opporet Opporet Opporet Opportunities Ftunities Ftunities Ftunities Ftunities ForororororSmall Small Small Small Small WWWWWoodland Ownersoodland Ownersoodland Ownersoodland Ownersoodland Owners

WWWWWashington County Small ashington County Small ashington County Small ashington County Small ashington County Small WWWWWoodlands oodlands oodlands oodlands oodlands AssociationAssociationAssociationAssociationAssociationDecember 2003December 2003December 2003December 2003December 2003

A primer for capturing small woodland resource values and creat-ing short-term income opportunities to sustain good management and

profitable ownership

4

Table of ContentsIntroductionIntroductionIntroductionIntroductionIntroduction 5 5 5 5 5

The Producers--Small The Producers--Small The Producers--Small The Producers--Small The Producers--Small WWWWWoodlands oodlands oodlands oodlands oodlands And Their OwnersAnd Their OwnersAnd Their OwnersAnd Their OwnersAnd Their Owners 7 7 7 7 7

The Existing MarkThe Existing MarkThe Existing MarkThe Existing MarkThe Existing Markets – Hoets – Hoets – Hoets – Hoets – How Much of w Much of w Much of w Much of w Much of What Kind?What Kind?What Kind?What Kind?What Kind? 8 8 8 8 8

KeKeKeKeKey Fy Fy Fy Fy Factors actors actors actors actors Affecting Small Affecting Small Affecting Small Affecting Small Affecting Small WWWWWoodland Markoodland Markoodland Markoodland Markoodland Marketsetsetsetsets 1111111111

TTTTTrees/Products to Markrees/Products to Markrees/Products to Markrees/Products to Markrees/Products to Marketetetetet 1313131313

LLLLLooking Doooking Doooking Doooking Doooking Down the Road -- Pwn the Road -- Pwn the Road -- Pwn the Road -- Pwn the Road -- Potential Opporotential Opporotential Opporotential Opporotential Opportunitiestunitiestunitiestunitiestunities 1818181818 for Small for Small for Small for Small for Small WWWWWoodland Ownersoodland Ownersoodland Ownersoodland Ownersoodland Owners

Appendix Appendix Appendix Appendix Appendix A:A:A:A:A: Analysis NotesAnalysis NotesAnalysis NotesAnalysis NotesAnalysis Notes 2222222222

Appendix B:Appendix B:Appendix B:Appendix B:Appendix B: Non-Timber F Non-Timber F Non-Timber F Non-Timber F Non-Timber Forest Productorest Productorest Productorest Productorest Product 2626262626 and and and and and VVVVValue Markalue Markalue Markalue Markalue MarketsetsetsetsetsAppendix C:Appendix C:Appendix C:Appendix C:Appendix C: Mark Mark Mark Mark Marketing Conceptseting Conceptseting Conceptseting Conceptseting Concepts 2929292929

Appendix D:Appendix D:Appendix D:Appendix D:Appendix D: Lo Lo Lo Lo Log-Sorg-Sorg-Sorg-Sorg-Sort t t t t YYYYYardsardsardsardsards 3232323232

Appendix E:Appendix E:Appendix E:Appendix E:Appendix E: Cer Cer Cer Cer Certified tified tified tified tified WWWWWoodoodoodoodood 3434343434

Appendix F:Appendix F:Appendix F:Appendix F:Appendix F: “Capturing F“Capturing F“Capturing F“Capturing F“Capturing Forest Product orest Product orest Product orest Product orest Product VVVVValuesaluesaluesaluesalues 4040404040 for Lando for Lando for Lando for Lando for Landowners and Manufacturers:”wners and Manufacturers:”wners and Manufacturers:”wners and Manufacturers:”wners and Manufacturers:” Conference Conference Conference Conference Conference,,,,, March 8, March 8, March 8, March 8, March 8, 2003 2003 2003 2003 2003Appendix G:Appendix G:Appendix G:Appendix G:Appendix G: Lo Lo Lo Lo Log Buyg Buyg Buyg Buyg Buyers [inserers [inserers [inserers [inserers [insert]t]t]t]t]

ReferencesReferencesReferencesReferencesReferences 4747474747

5

Introduction

Small woodland owners manage a large share of the for-ested lands in the United States (59%), Oregon (17%),and Washington County (37%). They also provide a large

share of the timber that is generated – in Oregon they contribute16% of the total amount of timber produced. WashingtonCounty small woodland owners produce 8% of the timberproduced in the County – a lower than state average but under-standable given the highly fractured land base and urbanizedenvironment. Recent timber volume projections for westernOregon suggest that forest industry lands could sustain harvestat recent levels. Non-industrial forestland owners, however,could raise harvests to near historical peak levels. These harvestlevels could be maintained over the next five decades with noreduction in the growing stock inventory – although the averageinventory age would decline over the period (Adams, et al,2002).

Woodland owners in Washington County manage theirlands for a variety of purposes. The 2002 Small WoodlandSurvey in Washington County explains some of the diversity inwoodland owner management objectives. Timber is not a pri-mary value for most owners – only 9% list timber as a primaryreason for ownership. However, a significant number of ownersidentified income and investment return as a primary value(18%). As might be expected, the larger the ownership, thehigher both timber and income/investment ranked as importantreasons for ownership. Most significant is the fact that two-thirds of woodland owners have harvested timber on theirproperty in the past – half in the last five years. One-half of thewoodland owners also said they plan to harvest some type offorest product in the future.

Small woodland owners often find themselves in a difficultposition when looking for markets for their forest products.

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Traditionally, they have sold their products in theform of timber, generally in a form that is suit-able for conversion to the commodity lumbermarket. Their buyers are usually nearby lumbermills, pulp mills, or other industrial operationsthat buy logs from private owners to supplementtheir own timberland supply.

There is a growing realization by smallwoodland owners that they are not alwaysachieving all the potential value from their forestproducts. The reasons vary:

• as the “supply of last resort” forindustrial operations, they may notreceive the most favorable offers;

• as the national commodity market goes,so goes their stumpage value;

• knowledge and access to non-commodityand “niche” markets is limited;

• they do not take advantage of theirunique potential, either in the form ofspecies, size, quality, or othercharacteristics of their forest products, orin conditions where they might have acompetitive advantage, such as smallquantities, custom “breakdown” orders,timing of delivery, or other specialfeatures;

• they are limited by economies of scale.

In addition to factors beyond thelandowner’s control, some landowners may notachieve all their potential value because they arenot interested or willing to do the “homework”necessary to understand and interact effectivelywith existing and potential markets.

The purpose of this analysis is to explorethe opportunities for small woodland owners tomarket a variety of products from their proper-ties, and to identify what small woodland ownerscan do to:

1. Structure their management goals, meth-ods, timing, or other factors to better suit exist-ing market opportunities.

2. Develop new market opportunities by

providing different products, working withothers to create marketable supplies, creating theability to move directly to retail or secondarymarkets, or other strategies.

3. Identify limiting factors that must beaddressed to improve marketing conditions andopportunities for small woodland owners.

4. Propose additional analysis and/orresearch needed.

Existing information was obtained frompublished sources, from interviews with knowl-edgeable persons, and from interpretation/interpolation from a variety of data sources. Allare referenced in the text and appendix. Methodsused were straightforward comparison, extrapo-lation from relationships in data, and personalexperience and judgment.

The analysis was not intended to be ofsufficient rigor to constitute research, but insteadrelied on drawing conclusions from existingdata. Assumptions based on experience andjudgment were used to identify relevant conclu-sions that could meet the purposes of the analy-sis.

The most important results expected fromthe analysis are to create reasonable expecta-tions among small woodland owners for im-proving their marketing opportunities, andprovide a basis for future analysis of potentialmarket opportunities.

7

Oregon has 4.4 million acres of forestland owned byfamily forestland owners (“Sustaining Oregon’s FamilyForestlands,” Oregon Department of Forestry, 2002).

An exact number of individual owners is not available fromexisting data, but some analyses have estimated that perhaps50,000 landowners are involved, with 157,400 separate forestedtracts. In Washington County, an analysis of forestland tax rollshas shown that there are 1,880 owners of forestland tracts from 5to 5,000 acres in size. The number of forestland acres on the taxrolls is almost 70,000 acres. There are additional forestlandsoutside those on the tax rolls as forestland. These forestlands arecommingled with agricultural or other tax classifications.

How much wood does this forestland produce? WashingtonCounty private, non-industrial forestlands produced 11.5 millionboard feet in 2001, or roughly 25% of potential growth. Howmuch wood can this forestland produce? The average forestlandsite index, as determined from the Soil Survey of WashingtonCounty (USDA-NRCS, in cooperation with the Oregon Agricul-tural Experiment Station) is 157. The index is calculated on abase of 100 years of age, and is determined by weighting siteindex with number of acres for identified forest soil types. (Siteindex is a measure of the height that forest trees will grow to at aspecified age – in this case, 100 years). This level of averageproductivity could produce, if intensively managed for woodproduction, 47.2 million board feet per year. As shown by theWashington County Small Woodland Survey, however, mostwoodland owners do not intensively manage their woodlands fortimber. They manage for a variety of objectives, and intensivetimber management is not always compatible with all of theirobjectives. The result is that they achieve only a portion of thetimber potential – as evidenced by the 2001 harvests of only25%.

The Producers–SmallWoodlands and Their

Owners

8

The ExistingMarkets – How

Much of What Kind?

There are three general types of markets that are importantto small woodland owners: traditional, non-traditional,and non-timber. Each of these market types has a distinct

set of characteristics that is related to the broad economy andrelated markets. The small woodland owner can optimize theeconomic values produced by their woodland by understandingthese types of markets and their characteristics, and managingtheir woodland to best take advantage of the peculiar marketopportunities they offer.

TTTTTraditional raditional raditional raditional raditional WWWWWood Markood Markood Markood Markood Market Characteristicset Characteristicset Characteristicset Characteristicset CharacteristicsTraditional wood products markets are defined on the basis

of commodities that are widely used and consumed, and whichare significant components of the existing wood demand andsupply relationship. The common traditional wood markets are:

Dimension lumber: A visit to your neighborhood lumberstore will demonstrate the variety of dimension wood productson the market. Additional dimension products are sold primarilyto construction and manufacturing businesses. Volume is the keyto success in the traditional dimension wood market. Withvolume comes a requirement for standardization of size, quality,availability, and other factors associated with meeting the marketdemand. Industrial forestry companies, and some public landsources, are best equipped to respond to this market because ofthe large volumes involved. Small woodland owners, on theother hand, often find themselves as the marginal supply, makingup what is not met by large, on-going in-house or contractualsuppliers. There is an estimated mill capacity of 750 millionboard feet in the three county (Washington, Columbia, andMultnomah) area that would be served by Washington Countysmall woodland owners (Binam, personal communication,2003). Additional capacity exists in Clackamas, Polk, and

9

Yamhill counties. There are over 90 forestproducts firms in Washington County, with 2900employees. Statewide the Oregon EmploymentDepartment projects a decline in lumber andwood product employment, but the projection forWashington County indicates a rise in employ-ment. In looking at the number of firms, Wash-ington County forest product firms are roughly14% sawmills, 60% furniture/cabinets/millwork,and 26% “other”, e.g. veneer, pulp, manufac-tured homes, pallets, display fixtures, etc. (ScottLeavengood, personal communications, 2003)

Veneer: Veneer in the Northwest generallyrefers to the thin sheets of wood peeled off logsand glued together in sheets to form constructiongrade material for underlaying walls, floors, androofs. More recently, engineered wood productssuch as laminated veneer lumber (LVL) are usedto produce wood I-beams for joists. While thereis still a market for veneer grade logs, thestrength of the market for veneer has sufferedsignificantly from competition by products suchas OSB (oriented strand board), constructed from“flakes” of wood chipped from logs not gener-ally of the same high quality as veneer gradelogs. Oregon has yet to establish an OSB facility,as the preferred species (primarily aspen andother poplar) are not prevalent in the localregion.

Pulp: Wood pulp is used for a variety ofproducts such as newsprint, cardboard, andstationery/computer paper. The type of paperproduct determines the wood pulp speciesdesired. Much of the pulp used comes as a by-product of other wood milling operations, andfrom recycling of paper products. Pulp is not ahigh valued woodland product, but is generally aby-product of logging stands where pulp speciesare 1) a component of the stand being logged, or2) a low quality component of species beinglogged for other products.

Poles: Poles for electrical transmission,(and to a lesser extent for building construction)are a consistent market for high quality trees thatmeet demanding standards for height/taperratios. Poles are often “pre-selected” out oftimber sales for sawlogs, and their premium

price justifies the higher costs of removing thetrees before the sawlogs, or in sorting and storingthem separately. The higher value of poles alsojustifies longer haul distances to pole markets.

Export: Wood products selected andshipped outside the United States are known as“export” products. Export products are subject tointernational market conditions far more thandomestic products are, as they compete with amuch larger supply base. Generally the specifica-tions for export logs are more restrictive than fordomestic markets, and are based on the uniquemanufacturing and market conditions in theimporting country. Growth in international woodsupplies, resulting from the increase in forestplantations and other wood sources around theworld, has reduced the opportunities (and price)available to woodland owners in recent years.Other factors that may have influenced theavailable export market are balance of tradeissues, the strong US dollar in relation to someother world currencies, and price issues resultingfrom labor and other production costs.

Non–TNon–TNon–TNon–TNon–Traditional raditional raditional raditional raditional WWWWWood Productsood Productsood Productsood Productsood ProductsSome wood product markets are primarily

dependent on their unique characteristics outsideof any potential traditional wood market. Thecharacteristics that define non-traditional woodproducts are:

Species-Specific: Wood is an aestheticmaterial as well as a medium for creating prod-ucts of utility. Furniture is an excellent example,where the species of wood (which carries uniquequalities of color, texture, grain, etc) is a majordeterminant of value. Even where the aestheticvalue is not important, species carries othervalues such as ease of woodworking or conver-sion, which makes it selectively desired in themarket. Markets for certain species may bedifficult for woodland owners to locate andaccess, and on-going business relationshipsbetween the markets and suppliers may inhibitnew woodland owners from gaining entry.

Size-Specific: Certain wood productsrequire a specific size of source wood for their

10

manufacture. The product may be “in the round”,where a minimum amount of reduction is re-quired to reach the target size, as in “log beams”used in great rooms or dens of houses. Someproducts have specific dimensions which dictatethe size of source wood needed, such as in largerustic beams.

Characteristic-Specific: Wood characteris-tics, such as density (reflected in the number ofgrowth rings per inch and/or the percentage ofhigher density latewood/summerwood in thegrowth ring), grain, color, history (such as insector stress marks), and other unique featuresdetermine the value in certain markets.

“Niche” markets: Some combinations ofthe above non-traditional characteristics oftendefine a niche market, though niche markets mayalso be defined more by characteristics of marketthan by characteristics of wood supply. Forexample, a competitive advantage for transporta-tion (cost), or identification with a unique prod-uct (chainsaw sculpture, house logs, or twistedlogs for use in columns), can create a nichemarket that though small, may be an importantmarket for a small woodland owner.

Non-Timber Products/VNon-Timber Products/VNon-Timber Products/VNon-Timber Products/VNon-Timber Products/ValuesaluesaluesaluesaluesDecorative: Materials such as greenery,

craft supplies, floral displays, and novelty itemscan provide an important supplement – or insome cases a primary income source. An addedadvantage of this market is that it can be utilizedwhile also producing a long-term wood productcrop.

Shade Culture and Food Crops: Othermarkets that can supplement a wood productincome are ferns, mushrooms, herbs, and othersub-canopy species. Many of these speciesrequire a partial shade to flourish, and the under-story of a timber stand can often provide an idealenvironment for them.

Experiences: Forested environments areimportant sources for camping and picnickingrecreation, “hunting and gathering”, Christmastree and yule log collecting, and other outdoor

experiences. Providing this environment - at afee – can be an alternate income source that ifmanaged properly can be accomplished whilealso raising timber and other forest crops.

Agro-forestry: Certain kinds of agriculturalenterprises may be appropriate and compatiblewith growing wood or other forestry crops.Forage produced under a partial shade maypermit limited livestock use (cattle, sheep, goats,etc). Generally the “sharing” of growing spacebetween forestry and agricultural enterprises willresult in less than maximum yields of both, butthe total income generated may exceed thatgenerated by a single enterprise and will help tocounteract the cyclic nature of these markets.More importantly, an agro-forestry approach maybetter suit cash flow or other owner managementobjectives.

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Key FactorsAffecting Small

Woodland MarketsBroad MarkBroad MarkBroad MarkBroad MarkBroad Market Implicationset Implicationset Implicationset Implicationset Implications

Small woodland owners are like a leaf in the wind inOregon’s traditional log markets. With an historicalmarket share of only one-tenth or so of the total harvest in

Washington County, small woodland owners are not a collectivemarket force in determining log prices. Indeed, even regionalwood market demands and prices are generally controlled bynational and international market fluctuations. Tracking nationaland international trends in wood markets is helpful, particularlywhere small woodland owners have the ability to time theirharvests during periods of favorable markets. Many factors affectnational and international market trends, including currencyexchange rates, commercial interest rates, tariffs, and buildingmaterial trends. The supply of wood available is not a controllingfactor; merely one of many that affect demand and price.

Species/Product MarkSpecies/Product MarkSpecies/Product MarkSpecies/Product MarkSpecies/Product Market Fluctuationet Fluctuationet Fluctuationet Fluctuationet FluctuationParticular species or products markets do not always follow

broad market trends. Instead, they are more influenced by con-sumer preferences associated with non-commodity goods,innovation in product development, creativity in market promo-tion, and other factors not associated with commodity markets.

Location – Haul DistanceLocation – Haul DistanceLocation – Haul DistanceLocation – Haul DistanceLocation – Haul DistanceNo matter which market is being pursued by a small wood-

land owner, the bottom line is the net return on the sale. Themost important variable is likely to be the cost of transportingthe logs or other forest product to the point of sale. For low valueproducts, the economical haul distance is comparatively low; for

12

high value products, a much longer haul distancemay still be economical. For example, there arenow significantly fewer buyers for large diameter(>30”) logs. Thus woodland owners often haveto transport large logs long distances to thenearest mill able to process them. The value ofsuch logs will dictate whether the haul distanceis economical.

Competitive Competitive Competitive Competitive Competitive AdAdAdAdAdvantages for Small vantages for Small vantages for Small vantages for Small vantages for Small WWWWWoodlandoodlandoodlandoodlandoodlandOwnersOwnersOwnersOwnersOwners

Small woodland owners do have somecompetitive advantage over owners of largerindustrial or public forests. The key is capitaliz-ing on small woodland owner characteristicssuch as intimate knowledge of the quality,species, and other potential product features; andcost control through personal involvement.Personal involvement can be a key attraction forsome smaller manufacturers. Small firms maywant to work directly with a woodland ownersand thus bypass the time delays (and costs) of amiddleman.

To some extent, small woodland ownersalso have the ability to time harvest entry andamount, though woodlands adjacent to largepublic or private ownerships may be greatlylimited in their timing options due to threat ofinsect, disease, or fire spreading on to theirlands.

By using these characteristics effectively,the small woodland owner can find “niches” andopportunities that larger owners would not findeconomic or would overlook. The followingtopic, “Trees/Products to Market,” will describesome of these small woodland owner opportuni-ties.

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Trees/Products ToMarket

“The species’“The species’“The species’“The species’“The species’ s the thing…” s the thing…” s the thing…” s the thing…” s the thing…” (paraphrasing (paraphrasing (paraphrasing (paraphrasing (paraphrasing Wm.Wm.Wm.Wm.Wm.ShakShakShakShakShakespeare).espeare).espeare).espeare).espeare). What species are attractive on the markWhat species are attractive on the markWhat species are attractive on the markWhat species are attractive on the markWhat species are attractive on the market?et?et?et?et?

It’s not news that certain species are more in demand thanother species. Sometimes the market preference is based on aspecies’ particular characteristics for a consumer or construc-

tion product. Sometimes it is simply a successful marketingstrategy used by a product producer. The end result is the same:a particular species is preferentially sought on the market. Asmall woodland owner can use this market preference to advan-tage if the owner has supplies of the desired species, or finds itin their management objectives to create a diversity of specieson their woodland. Often the species exists as a minor species ofnatural forest stands. Oregon has many hardwood species thathave potential value for the right market. Some like Oregonwhite oak, used in wine casks, flooring, and furniture; and redalder in the cabinet and furniture industry, are well-knownexamples. The development of markets for western juniper andhybrid poplar/cottonwood, though still in their infancy, are goodexamples of how a market can be developed when there is asupply available.

Western redcedar is a high-value lumber species. It also hasa number of specialty markets within the market, some of whichmight also be classified as “niches” or small markets. Saunas,hot tubs, decorative siding, and other products are exampleswhere the fact that they are made from cedar adds a premium tothe price.

Larger owners may have concentrated their efforts on afew species, generally in plantations. The competitive advan-tage for small landowners lies in their ability to focus on minorspecies within their management strategy, and to provide thesmall quantities of a particular species that the market may beinterested in.

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“I’ve got this defective (unusual,“I’ve got this defective (unusual,“I’ve got this defective (unusual,“I’ve got this defective (unusual,“I’ve got this defective (unusual, rare rare rare rare rare,,,,,distinguished,distinguished,distinguished,distinguished,distinguished, atypical, atypical, atypical, atypical, atypical, striking, striking, striking, striking, striking, etc etc etc etc etc.) w.) w.) w.) w.) wood (orood (orood (orood (orood (orother forest product) -- what can I do withother forest product) -- what can I do withother forest product) -- what can I do withother forest product) -- what can I do withother forest product) -- what can I do with

it?”it?”it?”it?”it?”According to an old adage, if life gives you

lemons, make lemonade! Small woodlandowners are sometimes presented an opportunitydisguised as a problem. Creative marketing maybe the means to capitalize on the situation.Markets can be created for the unusual, different– even bizarre types of wood or other forestproduct found on your woodland. As an exampleof how creativity has turned a problem into anopportunity – there is now a market for “denimpine” in the log home industry. In case the term“denim pine” doesn’t ring a bell for you, it issimply bug-killed timber that has acquired adistinctive coloring from blue-stain fungus. Onceshunned by traditional markets, “denim pine”now is sought by a segment of the log homemarket. “Pecky cypress” is another example ofusing a previously defective material to create anew market. How about developing a newmarket for wormy cedar? A new name mighthelp this “character wood” sell for a premium,instead of being a scale deduction! Other ex-amples include various growth defects such asburls (the equivalent of cancer in trees), spiral orwavy growth rings that result in highly-figuredwood as well as twisted stems that can be usedfor decorative columns or sculpture.

Creating new markets is not limited towood products. Shrubs, herbs, old bird’s neststhat can be used as decoration or for crafts,unusual or especially scenic woodland settings,nuts, berries, and other forest products canbecome cash opportunities for the woodlandowner.

“But I only ha“But I only ha“But I only ha“But I only ha“But I only have a small amount”ve a small amount”ve a small amount”ve a small amount”ve a small amount” – ho – ho – ho – ho – howwwwwcan small amounts be markcan small amounts be markcan small amounts be markcan small amounts be markcan small amounts be marketed?eted?eted?eted?eted?

While some small woodland owners haveenough forested acres to command interest fromtraditional markets, many do not. Managing awoodland requires that there be “operable”

harvest opportunities, whether they be for treeimprovement harvest to remove defective or lowquality trees; thinning to improve vigor andgrowth, or harvest to improve other managementobjectives (such as creating growing space forunderstory agroforestry crops). Operabilityrequires that a harvest be physically, technically,and economically feasible. Often the amount ofwood harvested in these operations does notjustify the interest of loggers, haulers, or logpurchasers. When a small wood volume isprojected, the landowner can:

• seek a traditional market willing to acceptthe volume,

• look for small market opportunities(more and more common now that thereare many small portable mills thatprocess wood for farm, construction, andother non-traditional use), or

• work with other landowners to “package”wood from a number of small woodlandsso that market opportunities areenhanced.

A good example of finding a market forsmall amount of wood comes from Vermont,where small woodland owners have found a usefor “ash butts” – the 4’ long sections of ash treescut during pre-harvest thinnings. The butts arecreated when the trees are cut at 4.5’ and thenagain at the end of the root flare. The butts areshipped to Ireland, where they are used in manu-facturing “hurleys” –a 36" stick used in thetraditional sport of hurling. It’s a small market,but still consumes enough Vermont ash butts tomake 150,000 hurleys a year! This exampledemonstrates the value of information – onemust first be aware that such a product exists,then the specifications (i.e. wood species,lengths, widths, etc) and, of course, who thebuyers are.

Log-sort yards are a potential option toaggregate small amounts of timber from a num-ber of woodland owners into a more marketablequantity. Log-sort yards also offer the opportu-nity to sort out the logs by different market

15

characteristics, so adequate volumes can bemarketed to specific markets where their valuecan be recovered. The result is “adding value” tothe logs marketed over what they would nor-mally recover from “camp-run” markets.

The competitive advantage for smallwoodland owners lies in the flexibility to seek avariety of market options that best meet theirneeds.

“My trees are too small/lar“My trees are too small/lar“My trees are too small/lar“My trees are too small/lar“My trees are too small/large/etcge/etcge/etcge/etcge/etc.....””””” – – – – – WhatWhatWhatWhatWhatcan be done to better fit into markcan be done to better fit into markcan be done to better fit into markcan be done to better fit into markcan be done to better fit into markets?ets?ets?ets?ets?

The “revolution” in log processing that hasoccurred over the last 20 years has created manyproblems for small woodland owners – whooften must rely on the changing traditionalmarkets. The primary problem lies with largetrees, generally those over 30 inches in diameter– trees that in the past were prized for theirveneer capability, fine grain, and clear wood.New mills and processors do not accept theselarge logs, so they must be transported longerdistances to find an older mill that can handlethem - and then at a lower per unit price. Arecent Oregon State University study found thatthere exists a large volume of such logs onprivate lands in Oregon (Wagner and Hansen etal., 2003). The study surmises that many privatelandowners may opt to liquidate their older,larger trees in order to offset the risk of evenlower prices for their large logs in the future. Asan alternative, owners with large, quality logsmay seek to capitalize on the asset represented inthe logs. This may include “breaking down”large logs into smaller components (cants orother sub-unit) with existing large log, lowvolume mills or portable mills which can handlelarge sizes. The high quality wood componentsmay then be of interest to secondary marketssuch as cabinetry, finish work in upscale homeconstruction, or products that need high qualitywood as a component. In a study reported in1998 in the Forest Products Journal, authorsEastin, Lane, Fight, and Barbour reported thatthe real price premiums commanded byclearwood grades of softwood lumber have beensteadily increasing over the long-term. The result

is above-average returns to timber producerswhere the yield of clearwood lumber can beenhanced through cost-effective intensive forestmanagement.

Electrical transmission pole cross-arms arean example of how typical large logs, withgreater than 8 annual rings per inch, mightacquire markets. Cross-arms require exactingwood source specifications – generally too time-consuming for most production-oriented mills.Working with a competent portable mill opera-tor, a woodland owner might market some largelog material at significantly higher prices. Anassumption would be that the “fall-off” (materialfrom the log that does not meet cross-arm qual-ity) can be marketed also. (John Belton, wood-land owner, Tree School, 2002). In general, fullutilization of material (that is, markets for thehigh-end material, low-end material, and resi-due) are required to make the entire operationeconomically feasible.

The competitive advantage for smallwoodland owners is in creating a linkage tosecondary markets. In the future, cooperativeefforts by small woodland owners may aggregatesufficient quantities of large logs to make othermarketing options feasible.

Small trees – those trees smaller than newindustry standards for traditional markets – areanother problem that may become an opportu-nity, at least for a portion of the supply. Planta-tion thinnings are the primary source of smalltrees in Washington County (and in most ofwestern Oregon). The potential supply of woodfrom small trees may easily flood any particularmarket, such as agricultural poles and posts, orrustic furniture. Realistically, unless a newmarket that will use huge amounts of low qualitywood (such as a co-generation facility) develops,small woodland owners will only be able tomarket a portion of the total small tree volumethey might have available. However, enterprisingowners may be able to find small markets thatthey can access. These may include the morecommon agricultural poles and posts market, butalso more specialized markets such as gardensupports, nursery supports, etc.

16

In older natural stands that are overstocked,the closely spaced annual rings make small treewood much stronger than trees grown at a morerapid rate in plantations. This characteristic maybe turned to the woodland owner’s advantage inmarkets looking for strength.

Another use for small wood is in creatingbig wood! Laminating pieces of small material tocreate desired larger pieces is growing, and it islikely that laminated wood will continue toincrease it’s share of the construction industry.Glue has become key to the future of wood inconstruction! The use of small trees and lamina-tion to respond to market needs is illustrated bythe use of small thinning trees to make woodposts for guardrails along highways. The shortlaminated posts have passed intensive stresstests, and are now used in 5 western states.

The competitive advantage is an easilyobtainable supply, coupled with a locationadvantage for transportation cost. This advantagecan be enhanced by cooperative woodland owneraction to obtain processing equipment (such aspost and pole processors), obtain volume con-tracts for an aggregated supply, or other innova-tive initiatives. Given that small trees are not inshort supply, success in marketing will not befound in one or two “secret products”, but willbe found more in an emphasis on processes toidentify unfulfilled needs, determine suitabilityof resources available, locate buyers, developproduct specifications, and business planning.

“Can I get a fair price or better access to“Can I get a fair price or better access to“Can I get a fair price or better access to“Can I get a fair price or better access to“Can I get a fair price or better access tothe markthe markthe markthe markthe marketplace for good management?”etplace for good management?”etplace for good management?”etplace for good management?”etplace for good management?” Or, Or, Or, Or, Or,getting credit for getting credit for getting credit for getting credit for getting credit for “doing the right thing”“doing the right thing”“doing the right thing”“doing the right thing”“doing the right thing” on on on on on

your wyour wyour wyour wyour woodlandoodlandoodlandoodlandoodlandSmall woodland owners in Washington

County are as diverse as the society they live in.Some value their woodlands as a family heritage(7%), some as an income or investment source(18%), and some because of their interest innatural resources or forest values (18%). Theprimary value related to their woodland, how-ever, is that it is their home environment (47%) –

they tend to take pride in their woodland man-agement. Most woodland owners are seriousabout managing their woodlands, however, nomatter what primary values they place on it.Over 50% of County woodland owners plansome sort of management activity on theirproperty in the future, and two-thirds haveharvested trees on their property in the past. (AGreen Tapestry – The Small Woodlands ofWashington County: Results of a Survey 2003)

Anyone in business wants to know “thebottom line” – what is the net return for manage-ment investment and energy? More specifically,will the marketplace recognize and reward myefforts to do a quality job of management? Willsuch practices as pruning for quality crop trees,planting improved seedlings, controlling compet-ing vegetation, and other forest practices yield ahigher return on the market? For some practices,the answer is found simply in the increased woodthat may be grown. For others, such as pruning,the answer is less obvious since an increasedmarket return is dependent not on the volume ofwood produced, but instead is based on whatwood qualities might be valued in the market,such as clear wood, tight grain, or other feature.The degree to which these features are recog-nized and rewarded in the marketplace is usuallydependent on finding “small” or niche markets,as discussed earlier.

One way of getting market recognition forgood management may be getting your woodlandand your management “certified” as sustainableby a certifying organization, such as ForestStewardship Council or American Tree FarmSystem. While the general traditional marketshave not recognized certification by a pricepremium, there are some small markets thathave. The more realistic reward for certificationis an increasing acceptance of certified wood –or in some cases a lack of acceptance for non-certified wood – and therefore better access to avariety of markets.

The competitive advantages for goodmanagement are 1) creating products that havequalities developed through good management,

17

and which fit niches not filled by the generalwood producers, and 2) seeking sustainablecertification that allows access to new markets.

“““““My timber wMy timber wMy timber wMy timber wMy timber won’on’on’on’on’t be ready to hart be ready to hart be ready to hart be ready to hart be ready to harvest for avest for avest for avest for avest for anumber of ynumber of ynumber of ynumber of ynumber of years”ears”ears”ears”ears” – – – – – What can I markWhat can I markWhat can I markWhat can I markWhat can I market toet toet toet toet to

papapapapay my my my my my ey ey ey ey expenses in the meantime?xpenses in the meantime?xpenses in the meantime?xpenses in the meantime?xpenses in the meantime?Nontimber forest products can be a signifi-

cant source of income for small woodlandowners. Products included under this categoryare nonwoody species, such as mushrooms,ferns, and other understory plants; nonwoodyparts of trees such as cones, fruits, bark, foliage,and sap; and woody material such as firewood,poles, and boughs. Nontimber forest productscan be found – or produced – from a variety offorestland conditions, and often the more diversethe forest, the more types and amounts of prod-ucts that can be recovered. The yield per acre isoften low, but the value per unit weight is high,for nontimber products. While investment costsfor harvesting are low, labor costs are high.

The four largest segments of the nontimberforest products industry in the Pacific Northwestare holiday greens, floral decorations and greens,wild edible mushrooms, and medicinal plants.Small woodland owners can find opportunities toobtain income from all four areas. The keys tosuccess are knowing what potential products youhave on your woodland, learning how to harvestthem, and finding the markets in your area. Somenaturally occurring plants can be cultivated andgrown in the forest, increasing the amount ofproduct that can be harvested. Others may not beeasily adapted to cultivation, and careful harvest-ing is needed to be able to retain the specieswhile obtaining a periodic crop. Look for oppor-tunities to obtain nontimber forest products fromportions of your woodland where you are notintensively managing for timber, such as riparianareas, meadows, and low-productivity areas. JimFreed ,Washington State Extension Forester, sayshe knows one owner that harvests $15,000 ofbough material a year from 5 acres of riparianarea (Capital Press, Dec. 13, 2002). Freed statesthat size of area, personal time available, knowl-

edge of plant growth habits, knowledge ofexisting markets, and ability to develop newretail markets are controlling factors in a suc-cessful nontimber forest products venture (per-sonal communication, November 18, 2002).

Nontimber products can also be “direct-marketed”, by selling them at floral shows, homeand garden shows, farmer’s markets, craft shows,and other venues. Capitalize on the advantagesyou have of offering quality and freshness, aswell as showcasing your sustainable manage-ment.

The competitive advantages for smallwoodland owners are in-depth knowledge oftheir woodland, opportunity to use the incidentalgrowing capacity of their woodland to get asecond complementary or supplemental crop,and the willingness to accept a “maintenance”level of income from those crops.

“Y“Y“Y“Y“You ou ou ou ou WWWWWant It ant It ant It ant It ant It When?”When?”When?”When?”When?” – T – T – T – T – Taking adaking adaking adaking adaking advantage ofvantage ofvantage ofvantage ofvantage ofseasonal fluctuations in the markseasonal fluctuations in the markseasonal fluctuations in the markseasonal fluctuations in the markseasonal fluctuations in the marketetetetetRainy, wet weather makes getting raw

material in from the woods more difficult forlumber mills and other wood markets. Someforestry industry lands are accessed by all-weather roads, a recognition by their managersthat the cost of putting a rock base on their roadsis often more than made up for in their ability toaccess their forestlands during the wet season.Often small woodland owners can use theirexisting all-weather access to market theirproducts during the time when many larger woodproviders are sitting out the market due to pooraccess. The competitive advantage is the factthat small woodlands are often easily accessedfrom improved roads maintained by the Countyor State. Woodland owners might improve theirability to utilize these existing roads duringinclement weather by making a relatively smallinvestment in improving their roads to reach thelocal road network. Often the cost of “rocking”their access road is more than made up for by thehigher seasonal price they receive for their wood.

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Looking Down theRoad – PotentialOpportunities forSmall Woodland

OwnersWhat What What What What Are the TAre the TAre the TAre the TAre the Trends?rends?rends?rends?rends?

The woods products industry has followed many nationaland international business trends. At a conference onmarketing for small woodland owners and wood product

manufacturers in March, 2003, Rick Fletcher, Extension Foresterfor Oregon State University, summed up the five major changesin the forest industry that are impacting markets:

• Globalization

• Mergers

• Plantations

• Glue replacing old growth

• Sustainability concerns

In the Pacific Northwest, impacts on the forest industry include:• Continued importance of commodity softwood lumber

• Growth in engineered wood product processing

• Niche marketing for high value woods from naturalforests

Fletcher said that the two major challenges for Oregon’s smallwoodland owners are:

• Gaining market leverage in a less competitive market

• Securing market niches, especially for high qualityproducts and large diameter sawlogs

(Capital Press, March 21, 2003)

The result has been reduced market price and demand

19

differentiation in wood markets. At the sametime, there is an increasing trend toward “underthe radar” business enterprises, targeted atspecific markets. Examples are trends towardorganic food products, energy efficiency, antiqueor historically significant furniture, and other“small markets.” Small markets are not necessar-ily “niche markets,” which tend to be very smallmarkets that are sought out by potential buyers,as opposed to “small markets,” which use massmarketing methods, but aimed at only a portionof the general market.

The trend toward certifying wood as com-ing from “sustainable” sources has becomemuch more significant in the past few years. Thereasons have been acceptance of the concept by amajority of the forest products industry, andincreased marketing attention to a “sustainablemanagement” label on forest products. Themeans, and to some extent the standards, forsustainability certification vary between forestindustry and some other certifying groups, butthe practical result is that more and more woodproducts are being marketed as coming fromsustainably managed forests. “Green building”now constitutes 8% of the building market sharein the U.S., and is growing rapidly. In the localarea in 2003, at least 3 million board feet will gointo building market through the mainstreamdistribution channel in a price competitivemanner (personal communication, Brent Davis,Ecotrust)

The volume of wood being imported fromforeign sources has also increased over the past10 years – affecting the demand for wood fromUS forestlands. The impact is felt differently byvarious locations, depending on the amount oflocal material available in proximity to woodprocessing facilities. In Oregon, the dramaticreduction in available wood from federal lands(over 50% in the last 20 years) has triggered millclosures and re-tooling to utilize the smallerdiameter wood available from federal lands andthe thousands of acres of plantations becomingmerchantable on forest industry lands. Theamount of wood coming from industrial forest-lands has remained relatively constant from 1980

to 2002, while the amount from other privatelands has varied from 3% to 16% of total market,tracking significant log price changes during theperiod. (source: Oregon Department of Forestry)

“Engineered wood” has become a signifi-cant factor in wood products used in constructionand other wood commodity markets. Technologi-cal advances in glues and lamination havespurred the increasing use of engineered wood,along with decreasing availability of highstrength construction wood at competitive prices.

National and international trends haveimplications for small woodland owners. Fewermarket outlets for (traditional) commodity wood,lower demands from those markets, and loweraverage prices result as these trends work theirway down the supply-demand chain to the localarea.

HoHoHoHoHow Can Small w Can Small w Can Small w Can Small w Can Small WWWWWoodland Owners Increaseoodland Owners Increaseoodland Owners Increaseoodland Owners Increaseoodland Owners IncreaseTheir Competitive Their Competitive Their Competitive Their Competitive Their Competitive AdAdAdAdAdvantage?vantage?vantage?vantage?vantage?

Small woodland owners must adapt their short-term harvest plans to take advantage of thespecies, amount, timing, and other competitiveadvantages they may have over the traditionaland commodity markets. Dick Courter,consulting forester, offers these marketing tipsfor small woodland owners:

• Get expert help in marketing your timber– the additional value recovered oftenexceeds the cost of the service!

• Determine a marketing technique, basedon the size, species, amount, distancefrom various markets, and othercharacteristics of your timber

• Sell directly to mills, exporters, orspecialty markets

• Use lump sum stumpage sales – whereyou have accounted for all the marketvalues in the stumpage price

• Join an organized group that offersguaranteed approximate volumes

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Full utilization of your timber product isimportant in capturing the potential of yourwoodland. Markets must be found – or created -for the low-end material (lower quality andresidual) as well as the higher quality products.

Be responsive in your relationships withbuyers in the marketplace. Buyers demandconsistency and reliability – on-time deliveriesand quality that matches expectations.

They may be willing to try out a new spe-cies and “buy local”, but will not tolerate latedeliveries, low yield, variable moisture content,or other factors that affect their ability to utilizeyour product. (Scott Leavengood, Oregon StateUniversity Forest Products Extension Agent,personal communication, March 2, 2003)

In the long-term, the woodland owner’scomplete woodland management strategy needsto be examined to determine how competitiveadvantage may be incorporated in on-going, day-to-day management decisions. As a part of themanagement strategy for woodland management,every woodland owner should also have a busi-ness plan component. The business plan shouldbe based on the forest-related products andservices the owner expects to produce as aresulting of achieving management plan goalsand objectives. The business plan will be thebasis for your marketing strategy, and will serveto distinguish a pipe dream from reality. Thebusiness plan provides a foundation for manymanagement decisions, but perhaps none moreimportant than those involved in marketing.

Deriving a reasonable return for manag-ing your woodlands in a responsible and effec-tive manner is a worthy goal. To achieve thisgoal, the manager should consider using thecompetitive advantages for good management,which are 1) creating products that have quali-ties developed through good management, andwhich fit niches not filled by the general woodproducers, and 2) seeking sustainable certifica-tion that allows access to new markets.

What What What What What Are Reasonable Are Reasonable Are Reasonable Are Reasonable Are Reasonable “Ne“Ne“Ne“Ne“Next Steps”?xt Steps”?xt Steps”?xt Steps”?xt Steps”?Small woodlands comprise a significant

portion of the national (and Oregon) forestlandbase. Yet, there are relatively few mechanismsfor creating and enhancing small woodlandowner access to markets in Oregon. In someother parts of the United States, particularly inthe East and South, some effective mechanismshave been operating for years. There have beenmany reasons why these mechanisms have notgenerally been developed or used in the West.These reasons include the dominance of publicand private industry ownership, mills and otherprocessing facilities developed to serve thoselarge ownerships, lack of cooperative traditionsamong small woodland owners, and a lack ofdiversity in market opportunities.

More recently, however, there have beensignificant changes in the market situation in theWest. Public lands are a much smaller compo-nent of wood supply due to public policy deci-sions. Wood processing facilities have undergonesignificant changes to respond to the loss of largelogs from public lands. Woodland owners areawakening to the need for cooperative actions toimprove their market access and net return fromtheir forests. Last but not least, new small andniche markets are developing to fill the need ofan economy that is diversifying to respond to anappreciation of wood as a craft, fine furniture,and upscale building material.

Small woodland owners need to take advan-tage of these market changes. As describedearlier, they have a number of potential competi-tive advantages. How can these competitiveadvantages be captured? Following are some ofthe actions that can be taken to improve market-ing opportunities for small woodland owners:

• Expand and improve market sourceinformation about a wide range of marketproducts – including non-timber forestproducts, niche products (e.g. craft anddecorative materials), “small market”products (e.g. cabinetry, flooring), large

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logs, non-consumptive forest resources, aswell as traditional wood markets.

• Develop “product specifications forinventory” for a wide variety of potentialproducts, values, and opportunities, aswell as inventory techniques designed forsmall woodland owners to use with thesespecifications. The goal is to be able tomatch up product specifications with thewood of specific characteristics found inwoodlands. Nontimber forest productspecifications should also be developed.

• Expand and improve the amount, type,and quality of information about theinventory of potential products, values,and opportunities available on smallwoodlands so potential market sourcescan determine their opportunities.

• Develop technology information forsmall scale producers and processors.The information would focus on theprocesses and machinery needed to createproducts from the wood that is available,such as drying regimes and cuttingguides, so that round wood could beconverted into more easily marketedforms.

• Develop cooperative ventures andrelationships. Some of the potentialventures might include

a. marketing agents to provide marketingservices to multiple owners, with thegoal of achieving better bargainingpositions or market access,

b. collection and sorting facilities, orarrangements with existing facilities,to serve multiple owners,

c. primary processing (break-down)facilities, by ownership or lease, tocreate products for secondary markets.These facilities could include smallportable mills and portable dryingkilns,

d. grading services where the cost ofgrading small scale producer productscould be shared,

e. equipment/facility sharing amongowners for high investment equipmentor facilities,

f. financial resources to provide short-termloans for front-loaded resourceproduction and to “bridge” the gapbetween harvest expenses and thesometimes lengthy period for paymentfor non-traditional forest products.

The Oregon Woodland Management andSales Cooperative already exists, and providesmanagement and marketing services to membersat a reduced cost. There is potential for theCooperative to expand it’s services and facilitiesto meet some of the above opportunities.

A marketing forum (Appendix G, “Captur-ing Forest Product Values for Landowners andManufacturers”) held March 8th, 2003, generatedmany interesting ideas for improving marketingopportunities for small woodland owners. Fol-lowing regional wood fairs are planned topresent and discuss case studies of actual mar-keting efforts underway in different parts ofOregon.

Washington County Small Woodlands hasbegun a project to assist a group of small wood-land owners achieve their personal goals forsustainability certification. The project is par-tially funded by a grant from the Multnomah-Washington County Regional Investment Board,and is scheduled to be completed in June, 2004.The project is being accomplished with theassistance of WCSWA members, Tualatin Soiland Water Conservation District, USDA NaturalResources Conservation Service, and OregonState University Extension Service.

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Appendix A:Analysis Notes

Primary Author: Dick Courter, CF and Consulting Forester

VVVVVolume Calculation from Site Indeolume Calculation from Site Indeolume Calculation from Site Indeolume Calculation from Site Indeolume Calculation from Site Indexxxxx

The Douglas fir yield table used in this calculation wasbased upon Age-Site Index regressions developed byCrown-Zellerbach with counsel and guidance from David

Bruce of the USFS Pacific Northwest Forest and Range Experi-ment Station.

Site Index

Age 150 157 16060 37.234 40.476 41.865Normality 1.0 1.0 1.0Ave. Dia.(inches) 12.7 13.4 13.7BA/sq.ft. 230.50 234.34 235.99Trees/A. 263 241 231

The above relationships are based on an unmanaged stand.

For managed stands, average diameter could be expected toincrease, basal area would likely be slightly less, and trees peracre would be considerably less throughout each phase ofmanagement. Total recovered volume would likely be greaterdue to recovering expected mortality. Mortality expected prior toactual tree death. However, we know of no good data indicatingrecoverable volume through management.

This report establishes an estimated minimum volume thatcould be expected from Washington County non-industrialforestlands over a 60-year rotation. Until such time as all 69,962Washington County forestland acres are intensively managed,the approach taken to arrive at this estimate seems reasonable:

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Assuming 40.5 MBF @ 60 years of age; then 69,962 acres could produce 2,833,461 MBF. That is2.8 billion board feet over a 60 year rotation. Assuming even flow harvest each year over the 60years, potential annual harvest would be 47.2 million board feet per year, or 678 board feet peracre per year. This would indicate that 1,162 acres could be final harvested each year.

Age Class/Species Distribution on Small Age Class/Species Distribution on Small Age Class/Species Distribution on Small Age Class/Species Distribution on Small Age Class/Species Distribution on Small WWWWWoodlandsoodlandsoodlandsoodlandsoodlandsThe 2002 Washington County Small Woodland Owner Survey provided owner estimates of the

age class and species distribution on small woodlands in the County. While the Survey provides dataindicating which tree species respondents having growing on their ownership, there is no reliableway to determine from the data what percentage of owned acres are within each species type. We canassume that there is a mixture of species within the ownerships. Some the less frequent species(Oregon maple, red alder, etc) are in nearly pure stands, but the data does not allow the amount to beidentified. 91.4 % of the Survey respondents indicated they have Douglas-fir, a reasonable assump-tion would be that most acres are predominately Douglas-fir, and so therefore Douglas-fir yieldtables are used in the calculations.

Alternate Calculation Method: Assume each age class is uniformly distributed within eachownership percentage.

Site IndexAge 150 157 16010 .000 0.000 0.00020 .000 0.000 0.00030 3.912 4.906 5.33240 15.529 17.355 18.13750 26.771 29.342 30.44460 37.234 40.476 41.865

County Age Forestland NIPF Acres DF Vol/A Apparent WashCo Vol.0-20 44.4% 31,063 0 .000 020-40 27.7% 19,380 4.906 95,07840-60 27.9% 19,519 29.342 572,727

100% 69,962 667,805 million board feet

Applying this site indexed based volume calculation to the Survey age class distribution:

CountyAge Forestland NIPF Acres DF Vol/A Apparent Wash. Co. Vol.10 22.2% 15,531 0.000 020 22.2% 15,532 0.000 030 13.85% 9,690 4.906 47,53940 13.85% 9,690 17.355 168,17050 13.95% 9,759 29.342 286,34860 13.95% 9,760 40.476 395,046

100% 69,962 897,104 million board feet

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While this method indicates roughly 34% more volume, it may be more accurate since each 10year age class is represented rather than the average for a 20-year age class.

Using this approach, it appears that the timber volume on non-industrial private lands(roughly 0.9 billion board feet) in Washington County is about one-third of the capacity ofthese lands to grow timber (2.8 billion board feet). The reason for the discrepancy between exist-ing volume and potential volume is very likely the fact that 44% of this lands are less than 30 yearsold, and do not yet have measurable volume.

If a hypothetical example were used that assumed that there were an equal age class distribu-tion, a potential future managed stand scenario would emerge for comparison:

This would represent an potential average across all age classes of 15,346 board feet/A. As comparedto the current volume of 12,822 board feet/A, the small private woodland volume is about 20% lessthan it would be under an even distribution of age classes.

Management Plans on Small Management Plans on Small Management Plans on Small Management Plans on Small Management Plans on Small WWWWWoodlandsoodlandsoodlandsoodlandsoodlandsThe Washington County Small Woodland Survey indicates that management plans, as reported

by the woodland owners, are in place on 13% of the woodlands. It cannot be assumed that thistranslates to 13% of the woodlands. The data is only for owners reporting, and there is no datarelationship to the acres owned by the owner reporting a management plan. However, an assumptioncould be made that there is a correlation, which would mean that 9,100 acres would be covered by amanagement plan (13% of 69,962 acres). In fact, this is likely a very conservative assumption, as thelarger ownerships are more likely to have management plans (personal observation).

If this 9,100 acres were related to the average of 49% of owners having a timber income/invest-ment objective (Survey), only 4,459 acres would be managed for timber.

This 4,459 acres could then be related to the current volume of 12,822 board feet per acre. Theresult is an estimate of 57.2 million board feet that could be classed as “available” for harvest(6.3% of the current volume). Relating this 4,459 acres to the volume in a managed, even age classdistribution (15,346 board feet/A), 68.4 million board feet would be “potentially available” (6.7%of the potential).

HarHarHarHarHarvest Plannedvest Plannedvest Plannedvest Plannedvest PlannedThe Survey indicated that 41% of small woodland owners plan to harvest a timber product in

the next 5 years. Assuming an even distribution across owners, this would mean that harvest wouldoccur on 28.7 thousand acres. The amount of timber harvest could range from 368 million board feet

Age NIPF Acres DF Vol/A Apparent Wash. Co. Vol.10 11,660 0.000 020 11,660 0.000 030 11,661 4.906 57,20940 11,660 17.355 202,35950 11,660 29.342 342,12860 11,661 40.476 471,991

69,962 1,073,687 million board feet

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(current volume estimate to 440 million board feet (potential volume estimate). Assuming evenharvest distribution over the next five years, 74-88 million board feet per year would come fromWashington County small woodlands (note: this would not include volume that may come fromwoodlands not in a “forestland” tax classification). During the past 2 years, Washington Countywood production from small woodlands has been 11.4 and 21.3 million board feet. If all conditionswere favorable for harvest, and owners followed through on their intention to harvest, this couldmean that harvest from small woodlands would significantly increase from recent history.

CerCerCerCerCertificationtificationtificationtificationtification16% of Washington County small woodland owners indicated in the Woodland survey that they

are certified under some type of certification system (certification as used in this analysis refers to a“sustainable management” certification offered by a third party). However, Survey responses raiseddoubts about the understanding of the respondents about what certification is. However, responsesdid show that 10% of the respondents are certified under either American Tree Farm System (ATFS)or Forest Stewardship Council (FSC).

There are 68 ATFS certified tree farms in Washington County. The number of FSC certifiedownerships is not know, but is much smaller. The ATFS tree farms average 177 acres in size, butthere is a wide range. However, if the average volume figures developed previously are applied(12,822 bf/A for current, and 15,346 bf/A for potential), then the range of potential certified woodfrom ATFS tree farms would be 2.3 million board feet to 2.7 million board feet. There is not enoughdata on FSC ownerships to make a similar analysis.

26

Forests provide a wide variety of products, values, andopportunities to landowners. In many cases, the economicvalue of these products, values, and opportunities is not

fully realized. The situation is changing, however, as morelandowners discover these economic values, and take advantageof them to enhance their cash flows and economic growth.

Non-timber forest product sectors:Non-timber forest product sectors:Non-timber forest product sectors:Non-timber forest product sectors:Non-timber forest product sectors: (from (from (from (from (from VVVVVon Hagen andon Hagen andon Hagen andon Hagen andon Hagen andFFFFFight,ight,ight,ight,ight, 1999) 1999) 1999) 1999) 1999)

Holiday greens – a fall and early winter market. Noble fir(Abies procera) is the preferred species, although subalpine fir(Abies lasiocarpa) and Pacific silver fir (Abies amabilis) are alsoused. Western redcedar (Thuja plicata) is preferred for garlandchains, but pine, incense-cedar, and juniper species are alsoused. This is a relatively stable market that is regional in naturebut includes wholesalers who supply retailers on a nation-widebasis.

Floral decoratives and greens – Species include salal(Gaultheria shallon, evergreen huckleberry (Vaccinium ovatum),bear grass (Xerophyllum), baby’s breath (Gypsophilapaniculata), swordfern (Polystchum munitum), and mosses(various species). They are used primarily by florists and infloral crafts; mosses are also used by the nursery to protectplants during transport. Markets are regional, national, andglobal. Moss, salal, and evergreen hucjkleberry are speciallypopular with florists in Germany and the Netherlands.

Wild mushrooms – Mushrooms are gathered commerciallyfor food and medicine, as well as recreationally. The top fourspecies gathered in terms of gross value are chanterelles(Cantherellus species), boletes (Boletus species), morels(Morchella species), and matsutake (Tricholoma magnivelare).

Appendix B:Non-Timber ForestProduct and Value

Markets

27

Mushroom availability is highly seasonal andcyclical, and markets are volatile. Domesticmarkets are growing, but mushrooms are prima-rily sold overseas, with chanterelles, morels, andboletes destined for Europe, and matsutake forJapan.

The volatility of prices and availability, theknowledge needed to find mushrooms, and therelatively high economic value per pound com-bine to contribute to a relatively closed, cash-based industry with a high turnover in harvestersand processors. In addition, the Pacific North-west is a small player in the global markets forthe four main mushrooms. The Pacific North-west is generally farther away from key marketsthan are its competitors, such as Poland andKorea, which are, respectively, the primarysuppliers of chanterelles and matsutake. Supplierrelations are thus fragile and closely guarded.

Medicinal plants – There are two majorsectors in the medicinal plant market – thephytopharmaceutical and the botanical or herbalsectors.

Phytopharmaceuticals are historicallysingle-compound-based products, subject toFood and Drug Administration regulation, withhigh investment levels and international agree-ments. The opportunities for woodland owners toprovide these types of products is smll.

Herbals are regulated under the DietarySupplement Health and Education Act. Importantherbal products in the Pacific Northwest arecascara sagrada (Rhamnus purshiana), St. John’swort (Hypericum perforatum), and valerian(Valeriana sitchensis), which are among the top20 in herbal supplemental sales in natural foodstores. Other species harvested as herbals aredwarf Oregon grape (Berberis nervosa), prince’spine (Chimaphila umbellata), yarrow (Achilleamillefolium), and horsetail (Equisetum spp.).Harvesters send most of their product to regionalwholesalers that supply the large retail herbalproduct and nutritional supplement segments ofthe marketplace.

Jim Freed, Special Forest ProductsExtension Specialist, Washington State Uni-versity, has worked extensively with landownersseeking to capture the benefits of integratingtheir timber management with management ofthe other plans in the forest. He offers thesecontrolling factors:

· Size of ownership is important –generally 200 acres or more are requiredto make a commercially feasibleoperation (editor’s note – a group oflandowners working together may be ableto make the operation economicallyfeasible)

• Available personal time is necessary.

• Knowledge of plant growth habits isneeded.

• Know the existing wholesale markets.

• A “business sense” and ability to developretail markets

Freed points out that forests change overtime, creating opportunities for different plantspecies to exist within the forest as the amount oflight and other factors change.

Though wholesale markets do exist formany potential products, woodland owners mayfind direct marketing to be more suited to theirsituation. Home and garden shows, floral shows,and farmers markets may be market opportuni-ties. Use the “local connection” to give an edgeto marketing. Also – he suggests that providing arecreational opportunity such as “U-Pick” pro-vides a means of adding value to non-timberforest products. (Capital Press, Dec. 13, 2002,and personal communication)

Conclusions about Non-timber FConclusions about Non-timber FConclusions about Non-timber FConclusions about Non-timber FConclusions about Non-timber ForestorestorestorestorestProducts (from Products (from Products (from Products (from Products (from VVVVVon Hagen and Fon Hagen and Fon Hagen and Fon Hagen and Fon Hagen and Fight)ight)ight)ight)ight)The growing interest in non-timber forest

products reveals the need for relevant informa-tion. Critical data on distribution and abundanceof important non-timber forest product speciesand on appropriate management strategies are

28

lacking. In addition, local markets are nonexist-ent or underdeveloped for many non-timberforest products. Non-timber forest productsindustries are seasonal, cyclical, and competitive,with generally low returns to harvesters.

Harvesting non-timber forest products isproviding opportunities, however (and theseopportunities might be meaningful to woodlandowners who are looking to supplement theirincome in-between timber crops; editor). Non-timber forest products have the potetnial to makea greater economic contribution than is currentlybeing realized through, for example, local busi-ness development, value added, and other strate-gies that expand the economies of communities.

If forests were managed jointly for timberand non-timber products, the contribution ofnon-timber products could enhance the totalecologic, economic, and social returns fromforest management. For example, simulations oflinked resource production of mushrooms,timber, decorative cones, conifer boughs, andChristmas trees in the high-elevation forests ofthe southern Cascade Range yielded positivecash flows under many of the scenarios consid-ered (Weigand,1997). From a conservationperspective, forest management systems empha-sizing a variety of forest products and servicesare generally higher in diversity, habitat value,recreation value, and aesthetic appeal. Theeconomic benefits are also distributed over awider group of beneficiaries than when onlytimber values are maximized.

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Appendix C: Marketing Concepts

MarkMarkMarkMarkMarketing Feting Feting Feting Feting Forest Products:orest Products:orest Products:orest Products:orest Products: F F F F Finding a Nicheinding a Nicheinding a Nicheinding a Nicheinding a NicheEric Hansen, Associate Professor and Extension Specialist,

Forest Products Marketing, Oregon State University (adaptedfrom Powerpoint presentation)

The nature of marketing is in understanding the differencebetween “selling” and “marketing.” Selling is getting ridof a product you have, and “marketing” is producing a

product that a customer wants and needs. The key then is findingout what the customer wants, and producing it. You must assesswant you want from the deal, what motivates you to proceedwith it, and what reward you expect.

Finding markets requires acquiring market information – ifyou know about the customer and the marketplace, you cansucceed. The information can be obtained from a variety ofsources - friends, relatives, and acquaintances can be veryuseful, as well as from retailers, competitors, cooperatives, tradejournals, trade shows, libraries, and more.

If you have a product to sell, test it out on some potentialcustomers. Develop questions to ask them, such as:

• What is your first impression of this product?

• Can you think of changes that would make it better?

• How would you like to see this product packaged?

• Whom do you prefer buying from?

• How much would your customers pay for this product?(careful with this one; you may have to get theinformation another way)

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• What would it take to make youinterested in this product?

Once you think you have a product thatmight appeal to the marketplace, identify poten-tial buyers and make your contacts.

Be aware of your costs – both in time anddollars. Remember to consider opportunity costs– is this where your time and resources are bestspent, or would another marketing opportunityoffer more return?

Mission-Based MarkMission-Based MarkMission-Based MarkMission-Based MarkMission-Based MarketingetingetingetingetingPaul Ralston, Vermont Family Forests

(remarks to a group of visitors from Oregon,2002)

Every organization should know why theyexist and what it is they do. That “reason forbeing” is their mission. The role of marketing isto take that mission to market and have themarketplace respond favorably. Mission-basedmarketing is a refinement of traditional market-ing theory that emphasizes clarity of purpose andfocused activity.

Mission-based marketing is appropriate forlarge and small organizations, for-profits andnon-profits. It is especially useful for resource-constrained organizations facing a lot of per-ceived opportunity.

A model of mission-based markA model of mission-based markA model of mission-based markA model of mission-based markA model of mission-based marketing:eting:eting:eting:eting:I. Match resources to expectations, and

manage them. Time, talent, and dollarsare the resources – and today, time is thescarce resource.

II. The planning pyramid. The purpose ofprocess is to have limited resources beeffective in taking your mission tomarket.

1. Mission

2. Strategy

3. Goals (multi-year)

4. Objectives (single year)

5. Tactics

Within the planning process, you mustfoster trust among those involved, have faiththat focused activity will work, and spend moretime thinking so that the doing is more effec-tive.

III.Evaluate the many “opportunities” yousee in the marketplace to see if there is afit:

1. On Purpose – does the activity accom-plish your mission?

2. On Position – can you do the activity in away that fits your position in the marketplace?

3. On Target – is the activity directed atyour target market?

4. On Budget – do you have the time, talentand dollars to do it right?

5. On Time – can you accomplish theactivity in time to help?

StrateStrateStrateStrateStrategies for markgies for markgies for markgies for markgies for marketing:eting:eting:eting:eting:• Cost Leader – well-suited for the

commodity market; the common businessstrategy. Can result in “price leader”.

• Differentiation – exploiting “beingdifferent” among a group of competitors;presented as being unique. Thedifferences are presented as the merits ofthe product. Certification programs arebuilt on differentiation, such as “greenwood”. Small players are vulnerable tolarge players co-opting the “difference”.Differentiation can evolve into “generic”.

• Focus – The basis of “niche” strategies.Niches can be by product, target,geography, or channel (how it’sprovided):

1. Product – hardwood flooring

2. Target – architects

3. Geographic – “local” area woodworkers

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4. Channel – retailers, garden centers, etc.

Some ideal dimensions of a competitive strateSome ideal dimensions of a competitive strateSome ideal dimensions of a competitive strateSome ideal dimensions of a competitive strateSome ideal dimensions of a competitive strategy:gy:gy:gy:gy:• Strong specialization through product

focus

• Brand building through allcommunications

• Developing “pull” along with “push”(leverage)

• Over-the-top service within the channel

Competitive strateCompetitive strateCompetitive strateCompetitive strateCompetitive strategies hagies hagies hagies hagies have four primarve four primarve four primarve four primarve four primary pary pary pary pary parts:ts:ts:ts:ts:• Offer – product or service

List the features and sell the benefits ofwhat you want to sell; find or create specializa-tion, and avoid the “strategic trap:” Worst – offercommodities; Better – offer “private label,” Best– offer brand.

• Positioning – window into thecustomer’s mind

Is there a unique position that can make youmore competitive?

Would a slogan help capture your position?

• Target – the group you want to reach

Who are your target customers?

Are there any overlooked targets of“influencers”?

• Channel – the path to your customer

How do you get your product in front ofyour target?

Are there any unique or uncrowded chan-nels to explore?

ConteConteConteConteContext of a xt of a xt of a xt of a xt of a Competitive Strategy:::::• Internal consistency and validity

• External validity (meets a need)

• Resource fit (time, talent, dollars)

• Communication and implementation

Finally – does your mission suggest astrategy?

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Appendix D:Log-Sort Yards

“Log-sort yards provide better utilization and marketingwith improved value recovery of currently available timberresources in North America. Log-sort yards provide manyservices in marketing wood and fiber by concentrating, merchan-dising, manufacturing, sorting, and adding value to logs.” (John“Rusty” Dramm, Forest Products Specialist, Forest ProductsLaboratory, Forest Service-USDA)

“A log-sort yard affords landowners considerable flexibilityin planning the timing and size of their harvest and also reducessome of the elements of economic and technical risk for them.”(Carol Daly, Flathead Economic Policy Center)

There is a variety of types of log-sort yards, each servinga different purpose or set of purposes. They may includemill yards, concentration yards, log reload yards, remote

log processing yards, and log-sort yards. Mill yards are thoseoperated by mills to provide an inventory for a mill. Concentra-tion yards provide a central point for accumulating logs for along-distance shipment to mill yards. Log-reload yards providetransfer points for logs to an different transport method. Remoteprocessing log yards feed satellite processing such as chipping.Log-sort yards take advantage of a diversified log market, andserve several objectives by sorting logs for the available market.

The key to a successful log-sort yard is a business plan thatanalyzes:

• raw material resource,

• product mixes,

• markets available,

• processing options,

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• community acceptance and resourcesavailable,

• management experience,

• financing options,

• and compatibility with the environmentalfactors

Barriers to a successful log-sort operation are:

• reliable source of raw material

• log product diversity

• diversified forest products industry logmarket

• transportation infrastructure

The goal of a log-sort yard is to improve thequality and productivity of log-sorting, utiliza-tion, marketing, and distribution. This results inimproved timber resource utilization and betterbottom-line business performance. The objec-tives of a log-sort yard are to

1. concentrate logs for shipment;

2. improve log grading, scaling, and sorting;

3. improve merchandising;

4. add value to logs;

5. improve log marketing; and

6. reduce log flow bottlenecks from forestto mill (Dramm).

Additional information on log-sort yards:

“Is It Time to Revisit the Log-Sort Yard? John“Rusty” Dramm and Gerry Jackson, ForestProducts Specialists, Forest Products Labora-tory, USDA Forest Service (unpublishedpaper)

Review of Log-Sort Yards. Dramm, Jackson,and Jenny Wong. FPL-GTR-132, ForestProducts Laboratory, USDA Forest Service

Log-Sort Yards and Other Marketing Systems.Carol Daly, Flathead Economic PolicyCenter, published by Pinchot Institute forConservation, Washington, D.C.

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Appendix E:Certified Wood

One of the opportunities available to smallwoodland owners interested in finding improved access and/or premium process for their wood is

some sort of certification. The term implies that the wood iscertified as coming from sustainably managed forests. Certifica-tion gives wood from those forests a distinction in the market-place. Whether or not this distinction can be translated into acompetitive advantage for the woodland owner depends onmany factors. Distance to a buyer of certified wood, amount ofwood that can be amassed for sale under this distinction, and theparticular market needs for certified wood at the time of sale aresome factors that may be important.

Competitive advantage for certified wood may result frombetter access, or from a better price, though the latter is notconsistently obtained. Better access is obtained when woodpurchasing facilities actively seek – or even limit their purchasesto – certified wood. This situation occurs with markets that arespecifically limited to Forest Stewardship Council (FSC) certi-fied wood, and markets oriented to Sustainable Forestry Initia-tive (SFC) and American Tree Farm System (ATFS) certifiedwood. These market-certified wood combinations are not alwaysinterchangeable, depending on individual markets.

A better price for certified wood has not been often real-ized. In fact, a better price is the exception rather than the rule.In some cases, such as wood sought for high-end markets, suchas for furniture and some home construction components, betterprices can be obtained. Another situation that may generatebetter prices is when large construction require certified wood inorder to meet mandated standards – generally for projects in thepublic sector.

A soon-to-be-released book, Rebuilt Green: The Natural

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Green Building as an Economic DevelopmentGreen Building as an Economic DevelopmentGreen Building as an Economic DevelopmentGreen Building as an Economic DevelopmentGreen Building as an Economic DevelopmentStrateStrateStrateStrateStrategygygygygy

The green building sector holds consider-able promise as part of the broader market shiftto a conservation economy. It encompasses awide variety of professional services: architec-ture, planning, engineering, construction, land-scape architecture, interior design, real estatemanagement and development, and others. Italso includes innovative green building prod-ucts like sustainably harvested wood (empha-sis added), fiber materials (e.g. straw bale orcompressed straw panels), fly ash cement, non-toxic paints and finishes, low-flow plumbingfixtures, photovoltaic panels, and fuel cells.Advanced sorting and materials recovery prac-tices during building construction anddeconstruction also create the feedstock formany specialized recycling and remanufacturingfacilities.

As more and more people realize that greenbuilding makes sense, experimentation withgreen technology has begun to grow exponen-tially. Some projects, like Ecotrust’s NaturalCapital Center, do a wholesale evaluation andemploy a wide range of green strategies. Otherstake a more incremental approach, tackling oneissue at a time, such as energy or water conserva-tion or transportation options. Yet, how does thebuilding team know — particularly if a projecttakes a wholesale approach to green building —that when the last nails are pounded and the low-energy lights switched on, that it has achievedthe environmental returns anticipated at thedesign stage?

Ecotrust, like a growing number of ownersand operators, turned to a third party — the U.S.Green Building Council’s Leadership in Energyand Environmental Design (LEED™) program— to verify the environmental performance of itsbuilding. LEED is the national standard for greenbuilding design and construction and the NaturalCapital Center is the first historic building in theUnited States to receive LEED’s prestigiousGold certification.

Why Certify?

Why certify? The best way to answer thisquestion is to look at successful certificationsystems in different industries for comparison.Two good examples are certified organic foodand Forest Stewardship Council (FSC) certifiedwood. As a consumer, would you feel confidentif your lumber distributor told you, “This woodcomes from a sustainable forest,” without seeinga chain-of-custody certificate explaining exactlywhere it originated and how that forest is man-aged? Would you accept a statement from yourgrocer that, “No pesticides were detected on thisproduce,” without third party verification? Thesequestions capture the motivation behind thecertification movement. A consumer purchasingFSC certified wood is assured that each piece oflumber comes from a forest managed in accor-dance with FSC requirements, that include landtenure, workers’ rights, and a responsible man-agement plan that ensures the long term health ofthe forest ecosystem. When a consumer buyscertified organic food, the customer is assuredthat a third party authority has verified that thefood was grown in accordance with the require-ments of the standards of an organization such asOregon Tilth or Quality Assurance International(QAI). These requirements include that theproduce be grown without chemical fertilizers orpesticides. In a similar way, LEED certificationprovides assurance that a building has compliedwith an established set of standards for greenbuilding.

The Language of Certification

The term certified is widely used to differ-entiate products and services in the marketplace,

Capital Center and the Transformative Power ofBuilding, published by Ecotrust of Portland,illustrates how markets for certified wood (inthis case, FSC certified wood) are becoming asignificant factor in the market place – andsignificant opportunity for woodland owners.The following excerpts from portions of thebook, written by Stuart Cowan, Rob Bennett, andRalph Nicola, are used with permission fromEcotrust.

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but the rigor of the standards and procedures thatstand behind the term vary significantly.

Generally, certification methods can bedivided into three categories: first-, second-, andthird-party certifications. First-party is alsoknown as “self-certification” because the certifi-cation involves no external verification ofclaims. Second-party certification is achieved byparticipating in an affiliated organization orgroup — such as a trade association — that inturn asserts qualitative claims about a product orservice. Third-party is the only truly “indepen-dent” certification method and consists of threeprimary components:

1) established standards for managementand performance;

2) accredited auditors and procedures;

3) specific certification assessments. Third-party certification is by far the most credible andeffective way to drive positive changes throughthe marketplace.

Certification of management practices — bethey in forestry, agriculture, or construction — isnot always enough. It is also necessary to trackmaterials as they flow through manufacturingand distribution and are delivered to the market.Without a certified “chain-of-custody” trackingsystem, there is no real way to ensure that aspecific product originates in a certified, well-managed forest, farm, or factory.

The Emergence of LEED

Even as interest in the industry grew, formany years there was little agreement on thedefinition of “green buildings” in NorthAmerica. With the best of intentions, manydevelopers incorporated a single environmentalimprovement or incremental approach in theirprojects and declared them “green.” With noformal standards, the term had little substance.People in the industry also had specific concernsabout energy and water conservation, limitednatural resources and habitat, solid waste, andworker health and productivity. The non-profitU.S. Green Building Council (USGBC), formed

in 1993, became the first industry association toidentify building measures that would addressthese concerns. In 1998, the Council developedLEED as an independent green building ratingsystem and released the LEED 2.0 Green Build-ing Rating System in 2000. Created throughconsensus by a group of volunteer professionalsfrom a wide cross-section of the design andconstruction industry, LEED was intended to:

• Offer design guidelines

• Recognize leaders

• Stimulate green competition

• Establish market value with arecognizable national brand

• Raise consumer awareness

• Transform the marketplace

LEED now provides a framework thatdefines a “green building” and brings a verifiableprocess to building design and construction. Acommittee of volunteer industry professionalsupdates the program every few years to reflectnew building technologies and ideas. The ratingsystem is a balance among current best practices,existing proven technologies and standards, andemerging ideas and technologies. This allows aproject to meet the requirements, while encour-aging creative solutions and innovation. LEEDalso offers a common vocabulary for describinggreen building measures. Each time the LEEDrating system is used, the terminology andstandards become more prevalent in the industry,making it easier for professionals to discussmeasures and technologies that achieve thesecriteria.

In a short period of time, LEED has gaineda high degree of credibility and influence duelargely to two key attributes of the program:

1. It fosters a performance-based approachrather than a prescriptive one. A prescriptivemethodology tells the design team exactly whatto implement; a performance-based methodologysets a goal and allows the design team to decidehow to reach it. This encourages new ideas,generates creative strategies, and advances the

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development of new technologies.

2. It takes a holistic approach to abuilding’s environmental performance. Thesystem was crafted to inspire a coordinatedapproach to design, systems integration, andconstruction. This whole-building perspectiveexplores potential synergies and connectionsamong green measures, and can greatly reducethe cost of construction and/or operation.

How LEED Works

LEED is organized as a point-based systemof prerequisites and credits and offers a scale forcertification. A project can achieve LEED Certi-fied, Silver, Gold, or Platinum. A project receivescertification after earning seven prerequisites anda certain number of points from a checklist.Certification involves a three-part procedure.First, a member of the project team registers theproject with the USGBC, preferably at its incep-tion. Then, using an integrated design processduring which members of the design team worktogether to optimize the resource and energyefficiency of the building — often beginningwith a design the team develops and incorporatesgreen building strategies into the project. Oncethe building is operational, the team submitsextensive documentation on its green featuresand their performance to-date, and the USGBCreviews and rates the project.

The key to success in most of these projectsis committing to green building before any otherdecisions are made. When identified early in thedesign process, green building strategies can beincorporated at a lower cost. The holistic designapproach creates an overlap of systems andstrategies, which often reduces or eliminatessystems. This lowers construction and futureoperating costs. By comparison, incrementalenergy efficiency measures often add to theconstruction cost of a project, but provide areturn on the initial investment by reducingoperating costs. This relationship betweenincremental efficiency and cost will hold true formost projects up to an energy use reduction ofabout 40% relative to the state energy code. If anintegrated design process begins early in a

project, however, a design team may be able toachieve energy savings far greater than 40% withminimal construction cost increase or perhapseven a cost savings.

Documentation is a crucial part of theLEED process. It must show that applicantsunderstand the intent and meet the requirementsof each prerequisite or credit. Although docu-mentation varies for each prerequisite or credit, itis collected throughout the design and construc-tion phases, and submitted to the USGBC at theconclusion of the project. The recent release ofthe new LEED 2.1 version of the Rating Systemincludes a spreadsheet, or Letter Template, foreach credit. Using the template, the project teamcan declare the fulfillment of the requirements ofeach credit and may only be asked to provide thedocumentation if a specific credit is audited.With this new process the USGBC expects toaudit roughly 30% of the credits, further stream-lining the overall documentation and certifica-tion process.

Conclusion

LEED is transforming the marketplace fromthe inside out. The volunteer professionals whocreated LEED purposely selected recognizedindustry standards to help guide the buildingindustry toward more sustainable practices. Afterexamining green building measures used byorganizations and states across the nation, theychose the top standards to apply to LEED. Thecredibility of these models greatly facilitated theadoption of LEED by the building industry.Today, when architects and engineers writespecifications to address LEED goals, contrac-tors must push their suppliers to find and manu-facture products that meet these objectives —creating new demand in the market and encour-aging the marketplace to respond.

In July of 2003, with over 943 projects (128million square feet) registered nationwide, LEEDcaptured 3% of all commercial project construc-tion by square footage. This is an impressivefigure for a three-year-old program. Sixtyprojects representing approximately nine millionsquare feet have been certified to date. The

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program has also been enthusiastically embracedby public agencies across the country, which willincrease these figures over time.

Luckily, throughout the United States thistype of leadership is beginning to emerge.Portland’s developers, designers, and buildingprofessionals are at the vanguard of this move-ment, finding creative new ways of building. Inaddition to the Natural Capital Center, severalprojects scattered across the city — the BreweryBlocks, Buckman Heights, Museum SouthApartments, and Viridian Place — demonstratethat the benefits of green building practices arecompelling. To accelerate the growth of thegreen building sector throughout Portland theCity partnered with other public and privatesector organizations, and together launched theinnovative and nationally recognized GreenBuilding Initiative in 1999. ……the Initiativegained momentum and status through severalkey policy decisions. First, Portland City Councilgranted it official status as a City program — theGreen Building Division (G/Rated) in the Officeof Sustainable Development (OSD). To give theprogram greater leverage, the Council thenpassed the City of Portland Green BuildingPolicy stipulating that all city facilities, infra-structure, and city-funded projects be built andretrofit using healthy and resource efficientbuilding practices. The Portland DevelopmentCommission (PDC), another major capital worksagency in the city, shortly followed suit, passinga groundbreaking policy requiring all new PDC-financed development to incorporate greenbuilding measures. The policy framework firmlyin place, G/Rated quickly developed a multi-faceted green building program, providingtechnical assistance and compiling relatedresources and information. It targeted the build-ing industry with key publications including a100-page resource guide, Greening Portland’sAffordable Housing, which establishes goals andpractical, cost-effective strategies to increase theenvironmental performance and durability of allof Portland’s subsidized housing; followed bythe nation’s first resource guide for greeningcommercial remodels, Creating a High Perfor-mance Workspace. This guide offers expert

advice on lighting, energy efficiency, indoor airquality, and waste reduction to those moving anorganization into a new or retrofitted commercialspace. Both publications include important,practical information like project checklists,model specifications, and lists of regional prod-uct vendors and manufacturers. To provide moretangible, hands-on demonstrations of greenbuilding practices, G/Rated sponsors an annualBuild it Green tour of homes. The first tour, heldin 2002, featured 15 residential homes in Port-land to a sold-out audience. Given the positiveresponse to these initiatives, G/Rated launchedReThink: Innovation in Ecological Design andConstruction, a sixteen-week, comprehensivegreen building training series for commercial andresidential building design and constructionprofessionals.

In July 2000, OSD convened a citizencommittee to provide input on how to structurean incentive program to stimulate demand forgreen building from businesses, commercialdevelopers, and homebuilders. Subsequently,OSD established a Green Investment Fund toprovide financial incentive for commercial,residential, subsidized housing, and emerginggreen building technologies projects. A one-time$700,000 allocation from the Solid Waste andRecycling Reserve Fund and another $100,000from OSD’s fiscal year 2001-2002 budget,brought the total Green Investment Fund to$800,000 to be spent between 2000 and 2002. Asa powerful non-monetary incentive, Portlandalso established a local version of the nationalLEED green building standard. The first suchlocal adaptation of LEED approved by the U.S.Green Building Council, Portland LEED tailorsthe national standard to local building anddevelopment requirements, while maintainingthird party verification and official certificationby the USGBC. G/Rated provides technicalsupport to local projects trying to attain thisprestigious award for green performance.

Across the country, other municipalities andstate and federal agencies are encouraging greenbuilding practices through similar incentives andassistance programs. The City of Austin, Texas

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has been encouraging this sector since 1991,adopting the country’s first green buildingguidelines for residential construction. Boulder,Colorado; Seattle, Washington; Santa Monicaand San Diego, California; and an assortment offederal and state agencies, now require theirfacilities to be LEED certified. Incentives arealso being crafted to encourage private sectorgreen development. In addition to Portland’sGreen Investment Fund, Seattle has developed acash incentive program, Arlington County,Virginia has created a density bonus, and SantaBarbara, California an expedited permittingincentive. In Portland, the mix of policy, incen-tives, and technical assistance seems to beworking. As of February 2003, 41 commercialand mixed-use buildings, totaling 3.1 millionsquare feet, had incorporated green buildingdesign and construction practices. The GreenInvestment Fund and the PDC’s affordablehousing requirements added another 1,314 unitsof efficient, durable, healthy housing to this mix.

More than 30 subsidized and market-ratehousing projects with almost 2,000 units are inthe pipeline now. As of July 2003, 36 LEEDprojects were registered in the Portland metroregion, the highest such concentration in NorthAmerica. The Oregon Office of Energy hasdeveloped a Business Energy Tax Credit, knownas the BETC, to complement Portland LEED,and the local utility, Portland General Electric,has launched an aggressive green buildingprogram for commercial and residential develop-ment and started a for-profit, green buildingconsulting firm.

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Appendix F:“Capturing ForestProduct Values forLandowners andManufacturers”

Conference, March 8, 2003

WWWWWork Group Notesork Group Notesork Group Notesork Group Notesork Group Notes

The following notes were developed from discussions insmall work groups for each of the listed topics. The notesprovide information that may be useful to woodland

owners considering their market opportunities, as well as identi-fying information needs, potential changes in laws, regulations,or institutions, and other needs that could improve marketingopportunities.

A1:A1:A1:A1:A1: Connecting to the Emer Connecting to the Emer Connecting to the Emer Connecting to the Emer Connecting to the Emerging Green Building Markging Green Building Markging Green Building Markging Green Building Markging Green Building MarketetetetetRalph DiNola, Green Building Services, Portland, ORBettina von Hagen, Ecotrust, Portland, ORBrent Davies, Ecotrust, Portland, OR (moderator)

There are currently 655 registered LEED projects in the US.The certification program started in 2000 and now has 3% of thebuilding market. Approximately 1.5 billion sq ft of LEEDbuildings are under construction this year. There is a $1 per sq fttax credit in OR available for LEED projects. Per capita, Or-egon is the leader of green building projects. About 22% of allpublicly funded buildings are now LEED certified.

Opportunities & Potentials to Improve Marketing

• Supply FSC wood to local commercial projects

• Aggregate the local supply to meet the local demand

• Initial survey shows that we have this capacity

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• Develop landowner cooperatives formarketing and supply

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Survey and aggregate local supply, whichEcotrust is currently doing

• Identify key green building projects andobtain commitments from projectmanagers to local supply

• Build and efficient and certifieddistribution chain and not circumventmainstream distribution channel

• Increase the capacity of local mills andmanufacturers

• Educate the public surrounding locallyand sustainably grown wood products

Practical, Achievable First Steps

• Look into FSC certification (not asdifficult as many believe)

• Find other landowners or manufacturerswith the same products

A2:A2:A2:A2:A2: Mark Mark Mark Mark Marketing Connections:eting Connections:eting Connections:eting Connections:eting Connections: finding your wa finding your wa finding your wa finding your wa finding your wayyyyyJennifer Allen, OECDD, Salem, OR (modera-

tor)Dennis Brock, NWPA, Bend, ORScott Leavengood, OSU Extension Service,

Beaverton, OR

Opportunities & Potentials to ImproveMarketing

• Need trainings for grading education;expand opportunities and affordability

• Potential to make “lesser known” speciesbetter known to the public and buyersincluding state purchasers and architects

• Get other service providers in the room tohelp align resources (like ODF,

consulting foresters) with producers andend users

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Get agencies and institutions (OECDD,OSWA, ODF, Extension) to better alignservices, vocabulary with needs on theground

• Douglas-fir “underutilized applications:collect and make information availableabout higher value and niche markets

• Need better information and expertise onaffordable grading for linking to thelandowner to improve marketing

• Explore multiple ways for landowners toget information (not just the web) and thetime scale for planning

Practical, Achievable First Steps

• Outreach to key buyers (state, architects)on “lesser known” species and other localproducts

• OFRI could play a key role in helping toget the word out about marketdevelopment

• Adapt educational tools to bringlandowners up to speed quickly in waythat fits different ways people learn

• Commit to follow through on actions inthe near term; sustained followthrough—WHO AND WHEN!

• Develop accessible information on whois buying what and where; Scott’s website and Dennis’ web site are examples

A3:A3:A3:A3:A3: Mark Mark Mark Mark Marketing Douglas-fireting Douglas-fireting Douglas-fireting Douglas-fireting Douglas-fir ::::: land manager land manager land manager land manager land managerperspectivesperspectivesperspectivesperspectivesperspectives

Barte Starker, Starker Forest Products,Corvallis, OR

Ken Everett, MAP, Inc, Oregon City, OR

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Mike Bondi, OSU Extension Service, OregonCity, OR (moderator)

Opportunities & Potentials to ImproveMarketing

• Explore possibility for developing a logsort yard for family forest owners; costapproximately $25/MBF

• Examine market opportunities for morethan just Douglas-fir

• Potential is out there to convert rawmaterial into finished product—manufactured to purchasers specs; metricand cubic measure conversion will beneeded

• Family forest owners should beencouraged to take advantage ofprofessional services and skills ofconsultants to improve the profitability oftheir sales

• Landowners need to be better educatedabout grades, sorts and specifications forpurchase; this needs to be done in thefield

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Great lack of information about who’sgot what and what’s needed; “I’ve gotlogs…who can I sell to? Need to figureout how to connect supply to demand—internet is the communication link ofchoice

• Need much better information aboutcurrent standing volumes and inventoryfor mills and manufacturers

• Need to figure our a way to make sureexisting mills remain viable; if they gounder, then they won’t be there in thefuture

• Need to develop ways to link smallerproducers together to improve economy

of scale for more profitable salespotential

• Need improved education for thoseselling products; merchandisinginformation, specifications formarketplace including grading andscaling

Practical, Achievable First Steps

• All family forest owners need to get agood, accurate inventory of their propertyby next Tuesday! Do we need a templateor format for what type of inventory weneed and what information to collect?

• Encourage family forest owners todevelop better management plans fortheir property with an emphasis on theinventory and business managementaspects

• Develop a more efficient way to sharemarket information on current trends,needs of specific mills, etc.; use theinternet to share this information

• Need a price and grade marketing reportwith all mill information on the OSWAwebsite by next Tuesday!

A4:A4:A4:A4:A4: F F F F Forestrorestrorestrorestrorestry Cooperatives:y Cooperatives:y Cooperatives:y Cooperatives:y Cooperatives: do the do the do the do the do they wy wy wy wy work,ork,ork,ork,ork,and if so,and if so,and if so,and if so,and if so, ho ho ho ho how?w?w?w?w?

Warren Gaskill, Sustainable Woods Coopera-tive, Lone Rock, WI

Ron Larson, Oregon Woodlands and SalesCooperative, Portland, OR

Kirk Hansen, Washington Department ofNatural Resources, Olympia, WA

Tom Nygren, Washington Co. Small WoodlandsAssociation, Hillsboro, OR. (moderator)

Opportunities & Potentials to ImproveMarketing

• Certifying forest properties—linkingtogether to minimize cost and makesystem work more easily for owners.Group certification will result in lower

43

per acre costs and can be achieved easierby getting expert assistance.

• Buffer against regulatory uncertainty –Cooperatives can help by using both thestrength of numbers and organization,and by working together to minimizeimpacts

HCPs in Washington State – bypreparing a Habitat Conservation Plan fora broad area, the landowners are givenassurance that the “rules of the game”under the ESA will not affect them

Power — lobbying can help, and anorganized effort through a cooperativehas more impact on regulators andlawmakers

• Market leverage for volumes and niches– Cooperatives can combine theirmembers products to have more marketleverage, as well as aggregate products tofit market niches.

• Bulk purchasing – Costs of fertilizer,planting stock, and other supplies can benegotiated on the larger volumes thatCooperative members need

• Cost of Services…negotiated leverage foraggregated ownerships can result inlower costs and provide incentive for topquality services

In-house

Contracting

Consulting

• Market development and services.Cooperatives, through the power of larvevolumes, known inventories, andcustomized marketing, can improve bothmarket access and profit for members.Examples are inventory systems keyed toproduct potential, aggregated marketofferings, and product potential logsorting

• Protection services – Cooperativesprovide an opportunity to collectivelyacquire improved fire protection

• Equipment sharing is a possibility bycooperatives purchasing and then rentingback specialty or high cost forestryequipment such as

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• State or other assistance to helplandowners help themselves inestablishing cooperatives, especially withtax implications, start-up funds, businessplanning.

• Lottery dollars are available throughRegional Investment Boards – they couldbe a source of funds to start acooperative.

• Feasibility studies (USDA) see next item

• www.familyforestfoundation.org is cooplink that can provide information abouthow they are starting a cooperative. Theirfeasibility study is available to use as amodel – they got a grant from the USDARural Business program to do afeasibility study on establishing acooperative.

• OECDD – through the sustainableforestry component of OECDD

• Continuing support (dollars, energy).Once established, cooperatives need“nurturing”, in the form of continuingexpert advice, capital funding,governmental help in coping with lawsand regulations, etc.

• Incentives to work together – how canlandowners be identified and broughttogether in their common interest?“Nothing succeeds like success” – sosome good examples can help developinterest

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Practical, Achievable First Steps

• Check on available resources; i.e., grants,technical assistance, good examples.Good publication called “BalancingEcology and Economics – A Start-UpGuide for Forest Owner Cooperation” isavailable and offers lots of practicalknowledge based on experience.Available from CooperativeDevelopment Services, 30 West MifflinStreet, Suite 401, Madison, WI

• Find out who might be interested. Noteveryone is interested in a cooperative.How do you find those who do?

Website survey – establish a survey onthe OSWA or chapter sirtes that peoplecan respond to with their interest infinding out about cooperatives

Telephone tree – use a telephone tree tosurvey landowners in your area

• Information—how to organize resources.Establishing a cooperative will requireexpertise in organizing people andprocesses. A good business plan is amust. Set objectives and clear pathwaysto achieve them

B1: Ingredients for a Successful SmallB1: Ingredients for a Successful SmallB1: Ingredients for a Successful SmallB1: Ingredients for a Successful SmallB1: Ingredients for a Successful SmallBusinessBusinessBusinessBusinessBusiness

John Berdes, Shorebank Enterprises Pacific,Ilwaco, WA

Dave Kleiber, Cascadia Revolving Fund,Seattle, WA

Karen Steer, Sustainable Northwest, Portland,OR

Opportunities & Potentials to ImproveMarketing

• Work on building (and tapping into)markets for lesser known species; thismarket segment is growing

• Focus marketing efforts on educationbuyers on the qualities, uniqueness andattractiveness of lesser known species

• Build networks and clustering ofmanufacturers working together todevelop, produce and market products

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Lesser known species have a verydifferent ‘look’ that prospective buyersare not used to. We need to make thislook more recognizable and desirable

• Drying capacities are limited in terms oflocation and volume to be able to drylesser known species

• There are appear to be many financialresources focused on milling andmanufacturing; we need to find/identifyfinancial opportunities for landowners aswell

• It is important to have a consistent andsteady supply of material to improvemarkets, yet there often is not a steadysupply of lesser known species

• More specific information on lesserknown species would help build itsmarket, including: Map of where are thespecies including:

Inventory (where is it found, species,characteristics, volumes, harvestschedules)

Information about proper harvestlevels

Is it merchantable?

• Much of the resources we need to growthe market already exists. We need tofind them and make them more readilyavailable to interested people

Practical, Achievable First Steps

• Have mill available that can run lesserknown species along with other morecommon species and product lines

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• Small businesses innovations fund

Section rep; not debt, not equity, butroyalty-based

B2:B2:B2:B2:B2: Resource Supply to End Use In Resource Supply to End Use In Resource Supply to End Use In Resource Supply to End Use In Resource Supply to End Use InventorventorventorventorventoryyyyyDick Courter, Genetechs, Portland, ORBill Wood, Magness Tree Farm, Wilsonville,

ORMike Barnes, Consulting Forester (moderator)

Opportunities & Potentials to ImproveMarketing

• Improve education of foresters—need tobetter understand the productspecifications

• Potential to connect to special markets—they are out there

• Purchase order requirements

• Combine resources—link supplierstogether

• Need some type of group organizationalsystem or structure for those withcommon interests

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Regulatory constraints reduce supply

• Scaling requirements—need to matchwith purchase orders

• Training program for inventory

Practical, Achievable First Steps

• Landowners should review theirinventory (if they have one) anddetermine its current status

• Update inventory as required

• Manufacturers should contact landownersto determine if connections can be made

B3:B3:B3:B3:B3: Niche Mark Niche Mark Niche Mark Niche Mark Niche Markets:ets:ets:ets:ets: what are the what are the what are the what are the what are they & hoy & hoy & hoy & hoy & howwwwwdo wdo wdo wdo wdo we find them?e find them?e find them?e find them?e find them?

Jim Meyers, Maple Grove Trading, Molalla,OR

Joel Koch, Astoria, ORScott Leavengood, OSU Extension Service,

Beaverton, OR (moderator)

Opportunities & Potentials to ImproveMarketing

• Niche marketing cooperative forproducts; a “one-stop shop”

• Woods tours for identification of high-valued and unique materials

• New niche products (versus what wealready see in the market)

• Wood products fair

• Flex nets

• “Skunk works”—creative, brainstormsessions for finding possibilities andpotential for the future

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• On part. list affiliation provided(woodland owner, mill, etc.)

• Special forest product information

Practical, Achievable First Steps

• Small niche markets

B4:B4:B4:B4:B4: Mark Mark Mark Mark Marketing Experiences:eting Experiences:eting Experiences:eting Experiences:eting Experiences: case studies case studies case studies case studies case studiesfrom the trenchesfrom the trenchesfrom the trenchesfrom the trenchesfrom the trenches

John Belton, JCB Tree Farms, Sandy, OR(moderator)

Kevin Kaster, Kaster Kustom Cutting, Mulino,OR

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Opportunities & Potentials to ImproveMarketing

• Numerous opportunities to add value toour forest products appear to be out there;key is to identify interested people, thosewith expertise, and make it happen

• If you have quality logs/products…people with marketing andmanufacturing skill…there are niches tobe found; creating the links is the key

• Opportunities to market FSC certifiedwood exist today; certified westernredcedar can be sold today with a marketpremium of ~10%

• A short term opportunity might be toidentify existing millers, marketers andmanufacturers who have an interest inworking with family forest owners tobegin to develop new markets; examplescould be Kevin Kaster and the log homebuilder from Sandy

Information Needs, Organizational &Institutional Changes, Legal & Regulatory

Changes, and Missing Links to RealizeMarketing Potential

• Need better information on woodqualities, uses and potentials for specificproduct manufacturing and marketopportunities; OSU is not getting the jobdone in market development and productdevelopment education

• Need more information about how to addvalue to wood products

• Need more information about marketingwood products

• Regulation changes are needed to allowportable mill owners to grade stamp theirown lumber

• There is a missing link between millowners (demand) and timber owners(supply); where do manufacturers getwhat they need and want?

• Need to coordinate transportation forlandowners to small and portable millsites (i.e., small volumes versus full loadtrucks)

• Need better kiln facilities and capacitiesto meet the needs of millers

• Need list of processors, small portableand stationary mills, moulding andmanufacturing facilities, and kilns.

Practical, Achievable First Steps

• Each landowner needs to assess howwhat we might do to market and addvalue to our wood take away fromgrowing the trees

• Explore with OSU how they can be acatalyst and leader to help makesomething happen in the new forestproduct marketplace of the future

• Survey mills, landowners and others toget the information needed; post on aweb site somewhere

• Call joinery and local processors to findmarket potential for wild cherry

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ReferencesSustaining Oregon’s Family Forestlands, 2002,

Oregon Department of Forestry.Estimated mill capacity in the Washington,

Multnomah, and Columbia County area.Personal communication from Kevin Binam,Western Wood Products Association, 2003.

Forest product firm breakdown. Personalcommunication from Scott Leavengood,Forest Products Extension Specialist, OregonState University, 2003.

The Big Log Project.” Ernesto Wagner, EricHansen, Scott Leavengood, John Punches,and Steve Bowers. OSU Extension Forestry,2003

“Forest Products Marketing: Tales from theTrenches.” John Belton, 2003 Tree Schoolpresentation.

A Green Tapestry – The Small Woodlands ofWashington County, Results of a survey.Washington County Small Woodlands Asso-ciation, 2003.

Opportunities for Conservation-Based Devel-opment of Nontimber Forest Products in thePacific Northwest. Bettina Von Hagen andRoger D. Fight, Pacific Northwest ForestResearch Station, PNW General TechnicalReport GTR-473, September, 1999.

“Opportunities Found in Forest Understory.”Jim Freed, Washington State ExtensionSpecialist, reported in the Capital Press,December 13, 2002.

Comments on controlling factors in non-timberforest product markets. Personal communica-tion from Jim Freed, Washington StateExtension Specialist, November 18, 2002.

Trends in the Forest Industry, from presentationby Rick Fletcher, OSU Extension Forester, ata conference “Capturing Forest ProductValues for Landowners and Manufacturers,”March 8, 2003, reported in the Capital Press,March 21, 2003.

Percentage of sustainable “green” wood in localbuilding market. Personal communicationfrom Brent Davies, Ecotrust, Portland, OR.

Proportion of wood coming from industrialversus small private woodlands. From Or-egon Department of Forestry website data,2003.

Buyer characteristics. Personal communicationfrom Scott Leavengood, OSU Forest Prod-ucts Extension Specialist, March 2, 2003.