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Red Alder; Market Reasons for Optimism!

Red Alder; Market Reasons for Optimism!. Larry Mason University of Washington College of Forest Resources Rural Technology Initiative. Washington Hardwoods Commission Annual Meeting, June 14, 2006. 5/06 price in 2004 $ Red Alder: $699 Douglas-fir: $620. Puget Sound Region.

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Red Alder; Market Reasons for Optimism!

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  1. Red Alder; Market Reasons for Optimism! Larry Mason University of Washington College of Forest Resources Rural Technology Initiative Washington Hardwoods Commission Annual Meeting, June 14, 2006

  2. 5/06 price in 2004 $ Red Alder: $699 Douglas-fir: $620 Puget Sound Region. Source: Log Lines (1989-2004, 2006), Forest Product Price Report (1959-1990), Timber Management Plus (current), U. S. Dept of Labor

  3. 2004

  4. 2004; 5% rate of return

  5. Price Indexes for Hardwood Lumber, 1965 - 2002 Average increase/year since 1965 of 4.9% More stable than softwood lumber Western producers produce < 5% of hardwood lumber Source: U.S. Forest Service

  6. U.S. Hardwood Exports1986-2002 $ Million Source: American Hardwood Export Council

  7. Source: USDA Foreign Agriculture Service

  8. Source: USDA Foreign Agriculture Service

  9. 2005 $121 Million Total Sales Source: USDA Foreign Agriculture Service

  10. Alder lumber export statistics for Jan-May of 2004 and 2005. Source: Hardwood Review (2005) and USDA Foreign Agricultural Service (2005).

  11. How Do Domestic Markets Respond to Alder? Source: Roos, J., G. Donovan, D. Nicholls. How does species name affect consumer choice?An analysis and implications for PNW cabinet door marketers. Forest Products Journal. 55(5). Pp. 21-26.

  12. 560 respondents in Anchorage 900 respondents in Seattle

  13. Combined alder preferences dominate selections!

  14. Huge opportunity for consumer education!

  15. But can Alder price get too high? C - $1.40 #1 - $1.00 #2 - $0.60 C - $1.50 #1 - $1.20 #2 - $0.70 C - ? #1 - $2.20 #2 - $1.70 C - $3.75 #1 - $2.50 #2 - $1.50 Poplar Maple Alder Cherry http://www.innernet.net/galleryofwood/pricelist.htm

  16. One reason for alder popularity among manufacturers is its workability Source: American Hardwood Export Council

  17. South West Rustic Furniture ??????????????? 4/4 Premium Frame $825/MBF 4/4 Standard and #3 Shop $550/MBF Source: Bill Redman, North Pacific Lumber

  18. Alder is the only wood approved for grocery pallets by the West coast food industry. But > $300/MBF? Source: Hardwood Lumber Review and Bill Redmond

  19. What about the pulp price? The west produces < 3% of U.S. hardwood chips Source: USDA Forest Service

  20. Look into the crystal ball

  21. Red Alder is not a tropical hardwood. • Planting Red Alder will diversify commercial forestland investments. • As prices rise more plantations are established. • Red Alder logs are likely to become increasingly scarce because present plantations are few. • Increases in research in intensive management and genetic improvements will likely result in hardier stock, shorter rotations, higher grades, and greater yields.

  22. Shorter rotations mean quicker return-on-investment and reduced risk. • Rapid growth does not appear to compromise lumber quality. • Red Alder appears well established in Domestic and Export niche markets. • Products markets can be strengthened and expanded through consumer education. • Engineered Wood Products may help with raw material shortages. • 200 MMBF in Alaska more in Canada.

  23. CONCLUSION: Red Alder is uniquely positioned among PNW log species for continued market success.

  24. Available on the web at no charge or on DVD-ROM for $10 (this can only be viewed on a computer with DVD reader). To order, contact Clara Burnett (clara75 @cfr.washington.edu), or call the RTI office at (206) 543-0827.

  25. Available on the web at http://www.treesearch.fs.fed.us/pubs/22325 Or in hard copy from: Pacific Northwest Research StationP.O. Box 3890Portland, OR 97208 (503) 808-2592

  26. Thank You

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