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March 17, 2017
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O ur V iew
Keep Washington on top
when it comes to trade
By NICOLE BERG
For the Capital Press
T
Mateusz Perkowski/Capital Press File
A container stacker operated by a longshoreman works at the Port of Portland’s container terminal in this file photo. The container
terminal has ceased operations but managers hope to attract another carrier or find another role the facility can play to help shippers.
Port weighs container traffic options
T
here may be hope yet for the
Port of Portland’s container
operation, which has been in
mothballs for two years.
The demise of Terminal 6 is
attributable to several important
factors. The trans-Pacific shipping
industry overexpanded in recent
years, meaning most companies
were financially stressed. The Port of
Portland is 100 miles upstream from
the Pacific Ocean and the largest
container ships could not call there
while fully loaded. The International
Longshore Workers Union made a
career of creating as much havoc
as it could, picking fights with the
terminal operator and other unions
and slowing down container traffic
to a trickle.
That toxic combination spelled
doom for the port’s container
operation. If and when a container
shipper will return to Terminal 6 is
anyone’s guess.
For agricultural exporters, that’s
bad news. Containers of hay, straw,
produce and other commodities now
must be trucked to Tacoma or Seattle
to be loaded onto ships for the trip
overseas, adding to the time and cost
of doing business.
But there’s hope the port can
play another role that would benefit
exporters. At a recent meeting of the
port’s board, managers suggested
that the port’s rail link could
be used to take containers from
Portland to the Puget Sound ports.
That would take truck traffic off
Interstate 5 and, presumably, save
exporters money. If the cost savings
are real, such a service would be
worthwhile.
In the meantime, the port is trying
to land another container shipper.
With the location of the port, that
will take some doing. Keeping
the Columbia River dredged to
accommodate larger container ships,
maintaining a truce with the ILWU
and finding an operator for the
facility now that ICTSI Oregon Inc.
is gone are all tall orders.
We hope it can be done. Fingers
crossed.
But in the meantime, a rail shuttle
or other possibilities for helping
agricultural exporters in the region
will be much appreciated.
7 predictions for the wood products market
By TYLER FRERES
For the Capital Press
he first quarter of 2017
has surprised the wood
products industry al-
ready; after a year where log
prices increased dramatically
and finished wood product
prices remained subdued at
best.
Good markets and bad mar-
kets can be distinguished by
very slight marginal shifts in
supply. We are in a glass half
full market at the moment and
it has given little optimism for
the rest of the year.
• Substantial increase in de-
mand: Housing starts are pro-
jected to be up 11 percent in
2017 and by another 11 percent
in 2018. Wood products pro-
ducers rarely take third-party
forecasts as gospel, but, if true,
there should be a substantial
increase in demand in 2017.
Increased industrial and com-
mercial uses for veneer-based
panels, as well as substitution
of plywood for oriented strand
board (OSB), could lead to
much brighter plywood panel
markets this year.
• Decreased panel supply:
A major provider in the Pacif-
ic Northwest wood products
market closed early this year.
OMAK Forest Products recent-
ly shut down all operations,
which has taken a significant
producer of sheathing and pan-
els off the market.
• Market turbulence with
trade: The Canada-U.S. soft-
wood lumber dispute, one of
the largest and most enduring
trade disputes between both na-
tions, enters unknowns after the
Softwood Lumber Agreement
expired in 2015. With a new
administration in the White
House, there is buzz about po-
tential import tariffs, which
could increase uncertainty in
T
Guest
comment
Tyler Freres
wood products markets and af-
fect the volume of panels enter-
ing the U.S.
• Wood product commodi-
ties challenged: U.S. commod-
ity wood products will con-
tinue to be adversely affected
by increased imports due to
the strong U.S. dollar, but will
North American demand be
enough to overcome downward
price pressure? U.S. companies
have tried to compete head-to-
head against cheap imports but
it has proven too painful. I think
we will see additional product
development in 2017 as U.S.
companies try to realize the
highest value out of expensive
resources.
• Conflict over resources:
Oregon’s Elliott Forest debate
is an indication of potential
future conflicts regarding the
responsible use of our nation’s
resources. While Gov. Kate
Brown’s plan called for as-
suming more state debt to buy
part of the forest, would issuing
$100 million in bonds really
solve the problem? The State
Land Board just ruled 2-1 to
proceed with the sale for $220
million, because the state has a
legal responsibility to generate
revenue for the state’s school
children.
Linn County is pursuing a
class-action lawsuit against the
state of Oregon alleging breach
of contract for failing to maxi-
mize the long-term benefit to
timber counties. They estimate
that the value of foregone tim-
ber harvest is around $1.4 bil-
lion. Can the state afford to pay
the counties back for the lost
revenue resulting from lack of
timber harvests?
• Restrictive legislation
hampers Oregon manufactur-
ers: Manufacturers have suf-
fered greatly at the hands of the
Oregon legislature. Minimum
wage and paid sick leave have
left employers scrambling to
put in place policies that meet
the letter and spirit of the laws
while also trying to maintain a
manufacturing environment.
Predictive scheduling, un-
der the guise of providing pre-
dictability, will rob employers
and employees of opportunity
for overtime and the flexibility
to compete during the rigors of
an unpredictable marketplace.
New overtime rules limit op-
portunity for our employees to
earn a higher paycheck, and
limit the company’s ability to
compete globally.
• Promising opportunities
with mass timber: Mass Timber
Construction has the potential
to revitalize the wood prod-
ucts industry. Freres Lumber
is excited to be part of this
promising movement by de-
veloping its own proprietary
mass timber panel, the Mass
Plywood Panel, or MPP. By
the end of 2017, we intend to
have a new production facili-
ty completed that can produce
veneer-based panels 12 feet
wide by 48 feet long by up to
24 inches thick. There is not a
producer in the world that can
produce a panel like what we
are envisioning. We have high
hopes that we have developed
an advanced engineered wood
product that can compete
globally and realize the full
potential of our local renew-
able resources.
Tyler Freres is vice
president of sales for Freres
Lumber Co., with plants in
Lyons and Mill City, Ore.
Visit www.frereslumber.com
or call 503-859-2121.
he recent changes in
the “other” Washington
have made trade and ex-
ports a very hot topic among
ranchers, farmers and growers
this winter.
With so much competition
for our export commodities
— especially wheat — we
cannot afford to lose focus on
the regulatory and infrastruc-
ture issues that have helped
make Washington a global
competitor.
Recently, I had the oppor-
tunity to learn more about
a group that is working to
enhance our trade-based
economy. Keep Washington
Competitive — known by the
initials KWC — is a coalition
of labor, business, agriculture
and other trade organizations
united to promote policies
that support trade in Wash-
ington as well as protect trade
from the negative impacts of
overbearing regulations.
Now, normally, you don’t
always see groups like labor
and the business commu-
nity in agreement with one
another. It’s not uncommon
for many of these groups to
be on opposite sides of an
issue. That’s what’s so com-
pelling about KWC. They
are steadfastly united around
trade and what it means for
our state, and are bringing di-
verse groups together to offer
support to policy makers who
seek to improve the regulato-
ry climate in the state.
A lot of what KWC does
is educate people about what
it means to be a global trade
and export leader. That means
advocating for transportation
— for ports and rail — as key
to the infrastructure that is
needed to move all kinds of
commodities from your fields
to ports far and wide. KWC
members focus on policies
— like how long it takes to
permit a project — which di-
rectly impacts private invest-
ment in things like rail lines or
export facilities.
I don’t need to remind you
that Washington state is the
Guest
comment
Nicole Berg
most trade-dependent state in
the nation. You know the key
stats: one in four jobs is tied
to trade. We export almost
90 percent of our wheat each
year, and we’re the fifth big-
gest exporter of wheat in the
nation. Trade matters, and it
matters in every corner of our
state.
Those of us in the agricul-
ture industry live this reality
every day. But those outside
our world need reminders.
That’s the value of KWC:
They bring diverse groups to-
gether to help policymakers,
elected officials, the media
and, really, the general public,
make the connection between
the wheat you grow and the
quality of life we all enjoy
here in Washington.
That’s why groups like
Keep Washington Competi-
tive are so critical: They keep
trade and the policies that af-
fect it on the front-burner for
policymakers in Olympia. By
encouraging investment in
Washington’s trade industries,
KWC works to make sure we
are positioned to thrive in the
increasingly competitive na-
tional and international mar-
ketplace.
Trade and exports are a vi-
tal piece of our economy, an
economy that must grow and
thrive beyond just the Puget
Sound region. It’s something
we all share in, and need to do
our best to support.
Check out Keep Wash-
ington Competitive online
at
www.keepwashington-
competitive.org and consider
joining the coalition to help
others understand what you
already know: Trade matters
for all of Washington state but
perhaps to no industry more
than us in the agriculture
sector.
Nicole Berg is chairwom-
an of the Washington Asso-
ciation of Wheat Growers
national committee and a
farmer in Paterson, Wash.
Readers’ views
E. Oregon copes
with disaster
Out of sight, out of
mind.
For us that phrase de-
scribes our failure to fo-
cus on the devastation our
farming and ranching fam-
ilies in Eastern Oregon are
currently
experiencing.
Excessive snow, ice and ex-
treme winter temperatures
have culminated in a literal
disaster. And we urge our
state’s major newspapers
and broadcast media to give
this catastrophe the cover-
age it deserves.
Damages and costs are
still being assessed, but full
recovery could take up to
three years, and cost over
$100 million. Regardless of
which side of the Cascades
you call home, it’s critical
we are all aware of and ac-
tively support our fellow
Oregonians through the near
insurmountable
difficul-
ties they’re facing from the
terrible effects of this past
winter. Because we are one
Oregon.
The onion industry,
which contributes about
$143 million annually to the
state economy, was hardest
hit. Current estimates place
total commodity loss at 150
million pounds, or the equiv-
alent of four 10-pound bags
for every man, woman, and
child in Oregon. To date, at
least 50 onion storage and
packing facilities have col-
lapsed from snow and ice
accumulation, leaving in-
sufficient infrastructure for
the 2017 harvest. Insurance
coverage is projected to only
cover 0-70 percent of re-
placement costs. Many Ore-
gon growers are considering
relocating and rebuilding in
Idaho, taking a good share
of those $143 million in rev-
enues with them.
Livestock suffered from
the severe weather. At least
1,000 mother cows are lost
and assumed dead. Calf
births are down 30 percent
so far this year. Livestock
weight gains are down 40-
50 percent versus typical
years.
There is also significant
expense to infrastructure.
Damage to roads and build-
ings is considerable. Coun-
ty and city budget reserves
were depleted to fund snow
removal. Flooding remains a
very real concern.
Those affected are
hard-working farming and
ranching families whose
businesses are vital to Ore-
gon agriculture and the state
economy. The recent area
visit by Governor Brown,
Senator Ferrioli and Repre-
sentative Bentz, and initial
efforts to bring emergency
aid to these communities
should be applauded, but
more is needed to restore
and maintain a vibrant ag-
ricultural community that
contributes so much to Ore-
gon’s economic health.
Oregonians are urged to
support House Bill 2012,
the Eastern Oregon Border
Economic
Development
Act, designating Ontario,
Vale, Nyssa and the imme-
diate surrounding area as
the “Eastern Oregon Border
Economic Development Re-
gion. HB 2012 would use
$10 million in borrowed
economic
development
funds from the Oregon lot-
tery; the money would be
repaid over time. HB 2012
would create a new sev-
en-member board run by
locals to promote workforce
and economic growth in
the area, with the ability to
award economy-boosting
grants and loans.
Please stand with us to
support Eastern Oregon
families and businesses that
have suffered so much in re-
cent months. Let’s give this
disaster the attention it de-
serves to ensure a vibrant fu-
ture for farming and ranch-
ing families and businesses
that comprise the heart of
this historic and unique part
of Oregon. Because we are
one Oregon.
Sen. Ted Ferrioli
John Day, Ore.
Sen. Bill Hansell
Athena, Ore.
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