This year’s Hardwood Federation Fly-In, held Sept. 11-14 in Washington, D.C., experienced record-breaking attendance with more than 80 leaders of the U.S. hardwood industry participating. Among these attendees were 13 first-time participants representing the NWFA Emerging Leaders Council, and seven first-time participants representing the Hardwood Manufacturers Association NextGen Leaders Council.
The events started with a networking lunch held at Hardwood Federation headquarters, where first-time attendees met members of the Hardwood Federation Board, as well as seasoned Fly-In participants. These Young Hardwood Leaders then attended an orientation meeting to learn more about the Fly-In objectives, key issues impacting our industry, and the specific meetings they would attend.
Participants took part in more than 120 meetings with members of the House of Representatives, the Senate, and the administration to discuss issues impacting their companies, their communities, and our industry. Included in these meetings were sessions with three of the top-level Trump Administration officials, including U.S. Secretary of Agriculture Sonny Perdue, senior staff and advisors to U.S. Commerce Secretary Wilbur Ross, and Vice President Mike Pence.
The key issue addressed during nearly every meeting was the current trade dispute with China and the serious negative impacts the imposed retaliatory tariffs, ranging from 10 percent to 25 percent, could have on the industry. In 2017, the U.S. lumber industry exported $4.04 billion worth of lumber to global markets, with $2.09 billion going to Greater China, which includes the autonomous regions of Hong Kong and Macau. Most of these exports are now consumed in Greater China as opposed to being manufactured into finished products, such as wood flooring, and exported back to the United States. This is a significant shift from previous production practices.
Many mills participating in the meetings reported steep declines in orders and shipments ranging from 30 percent to 60 percent, and pricing declines ranging from 25 percent to 30 percent. These losses have been realized since the first quarter of 2018 when tariffs were first proposed, and are expected to escalate as uncertainty about the administration’s response continues. Some participants also indicated that if the downward spiral continues, they will be forced to reduce workforces by 40 percent to 50 percent. In extreme cases, mills could be forced to close, which would have catastrophic consequences in many rural communities.
Another key issue addressed was the Farm Bill, which includes several provisions affecting our industry. The first is export promotion, which includes the Market Access Program (MAP) and Foreign Market Development (FMD) program. These programs help to open markets to U.S. agricultural products overseas, including lumber. The second is federal forest management, which includes efforts to better manage the 193 million acres of federal forests, reduce the risk of wildfires, and protect forest health by combating insect infestations and disease. The third is energy, which includes initiatives to promote biomass energy and deployment of heating and power systems that rely on wood-based biomass fuel. Most U.S. lumber producers use woody biomass to heat facilities, or convert that waste into secondary market heating alternatives such as wood pellets.
Following these meetings, attendees participated in an evening reception with Republican Members of Congress, and took part in a night tour of the U.S. Capital. They also attended a breakfast with Democratic Members of Congress.
The U.S. wood products industry is a significant contributor to the U.S. economy. It accounts for approximately 4 percent of the total U.S. manufacturing gross domestic product, it is among the top 10 manufacturing sector employers in 47 states, it produces more than $210 billion in products annually, and it employs nearly 900,000 people. Make plans to represent our industry during the Hardwood Federation’s 2019 Fly-In. More information is available at hardwoodfederation.com.