A Flawed Timber Market

Former President, Jimmy Carter is, among other things, a private timber manager. Below is an article he wrote that appeared in the New York Times where he shares his concerns about the American Free Trade Agreement.

Along with all the other former presidents, I was a strong supporter of the North American Free Trade Agreement when it was initiated in 1994. Free trade among the United States, Mexico and Canada has, in general, been good for the people and the economies of all three nations. However, we are now facing a crises in the marketing of lumber that could be devastating to 10 million American landowners, 20,000 sawmill owners and more than 700,000 workers, and also to the environment. This problem has aroused the concern of labor, industry and environmentalists. 

There are many facets to this complicated issue, but they can be summarized in relatively simple terms. In Canada, the national and provincial governments own 95 percent of the timberland. In the United States, private investors own the overwhelming potion of woodlands. Timber companies like Weyerhaeuser, Georgia-Pacific and International Paper own another 20 percent, while the remaining 10 percent is in public ownership, as in parks and military bases. Royalynn and I are typical family landowners. On our relatively small woodland tracts, some of which our family has owned for seven generations, we maintain a proper mix of hardwood and softwood trees for optimum wildlife habitat, and we market our timber selectively when it reaches full maturity. 

We cut relatively small areas at a time and replant as quickly as possible after harvesting. Within 10 years, we being periodic thinning, always providing the best conditions for optimum growth of the next generation of fullgrown trees. When we sell some mature trees, we obtain bids from sawmill owners, who are under contract to cut under strict conditions that protect the permanent value and productivity of the farm. It is an almost universal practice of families like ours to protect the land from erosion and to replant another crop immediately after harvest. 

Our sawmills must pay full market price for standing timber, saw and dress the lumber as efficiently as possible, and sell it on the retail market. Canada has no equivalent free market for the overwhelming portion of its timber. Provincial governments grant an annual allowable cut to sawmill owners at whatever low price is necessary to maintain full employment in the timber industry. These sawmills usually pay a fraction of the price that American sawmill owners pay, creating a great disparity that is beginning to wreak havoc with the timber industry in the United States, from the farm family that owns some woodland to the small or large sawmill owners who cannot compete on the retail market with the heavily subsidized lumber being imported from Canada. 

These disparities between the American and Canadian timber industries have existed for more than 25 years. In 1996, the United States and Canada signed a five-year pact [which expired this Spring] that tried to limit the problem by restricting Canadian exports of lumber into the United States. But quotas are not the answer. What we need is a permanent agreement that ensures free trade but ends the artificial price restrictions that the Canadian government has put on timber. This will allow both Canadian and American lumber interests to compete on equal footing. 

Without a dependable timber market in the Unites States, many landowners cannot afford to invest in reforestation and forest maintenance, and the consequence will be land that is barren or converted to other uses. The cost to society is great - less carbon dioxide sequestered in the trees, a loss of air and water filtration, less green space and wildlife, and more soil erosion and urbanization. Our family has other personal income and can survive even if our nation's timber industry is crippled, but hundreds of thousands of American families depend on a fair and stable market for their livelihood. Their interests must be protected.