Feeding America's insatiable appetite for lumber

The Trump administration wants to expand the American lumber industry by logging more trees in national forests and raising tariffs on lumber imports. The impact that could have on the domestic timber industry.

Ryan Dezember, reporter for the Wall Street Journal. Writes about commodities, including lumber.

Scott Dane, executive director of the American Loggers Council, a national advocacy representing nearly 10,000 companies and 50,000 employees in the logging and log trucking industry.

Jim Manke, owner of Manke Lumber Company in Washington State.

Troy Jackson, fifth-generation logger from Allagash, Maine and the previous president of the Maine Senate.

Randi Spivak, public lands policy director at the Center for Biological Diversity.

Part I

MEGHNA CHAKRABARTI: I want you to think for a second about the woods. What comes to mind? The calm, the sound of birds chirping, maybe a twig snapping as you walk along. Also, in many forests, there's this prevailing sound.

(TIMBER HARVEST SOUNDS)

CHAKRABARTI: Sound of a timber harvest, of course, utilized and revered by the indigenous peoples of this continent, harvested and prized by settlers. America's forests are arguably more important in this nation's story than is oil. Even Alexis de Tocqueville, that early biographer of America was awed by this country's forests. In 1831 on a nine-day trip along the Saginaw Trail in Michigan, Tocqueville wrote, quote: In this ocean of foliage who can point the way? In vain, you climb the tallest trees only to find yourself surrounded by others, still taller.

The forest climbs with you everywhere, and this same forest stretches from where you stand, all the way to the North Pole and the Pacific Ocean, end quote.

And it was this endless ocean of lumber that settlers were clearing, milling, and building with Tocqueville felt a kind of horrified fascination with that. Quote: Soon you hear the sound of an axe striking a tree. Signs of destruction herald the presence of man. Still more unmistakably. Tree trunks scorched by fire or mutilated by axes lying your root. You continue on and have come eventually to a patch of wood where all the trees seem to have been struck dead at one fell swoop, end quote.

But at the same time, Tocqueville could not deny what all those trees were allowing Americans to do. To establish something genuinely new. He wrote, quote, Americans in their log cabins look like rich people who have decided to spend a season in a hunting lodge. He goes on and says, Neat and quite pretty houses, enclosing an equal number of well-stocked stores, a clear stream, a square clearing of a quarter league on a side, and the eternal forest all around, end quote.

So this particular observation of his was made near the banks of the Clinton River where it did not escape Tocqueville's notice that there was both a grist mill and a sawmill.

JIM MANKE: When I was 12, 13 years old, you're out dragging Christmas trees and 14,15 you're working in a sawmill. Other than teaching school for two and a half years, that's been my life.

And I like going to work.

CHAKRABARTI: Well, this is Jim Manke, a lumber industry veteran in Tacoma, Washington. He got into the lumber business way more than a century after Tocqueville marveled at Michigan's Forests. Manke's company in the Pacific Northwest runs two sawmills and owns about 45,000 acres of forested land.

He's 84 now and says the modern lumber industry has always had its ups and downs.

MANKE: I mean, we had a lot of years where you lost lots of money and there's lots of years where you make lots of money. And we all worked. I was in the production sales end. I had one brother that bought all the land and timber, and then the oldest brother was a machinery guy.

And we just didn't depend on too much outside stuff. We did it ourselves. And the state of Washington is almost out of independent sawmills, and so we're still alive, but it's a struggle.

CHAKRABARTI: And since the pandemic, business has been down. In the last few years, Manke says he's had to cut his workforce by about 20% from 500 to 400 employees.

His mills are running at under 60% capacity by cutting night shifts, and he says the main culprit is Canadian lumber. So this is one of the strange ironies of the modern U.S. timber industry, despite being the number one produce and consumer of timber in the world, the United States imports about 30% of its lumber, the vast majority of which comes from Canadian forests.

MANKE: They have so much production up there, and the timber is so, it's available that they just control the world's markets, really. They put out nice product and they do a good job, but it's not a fair playground I don't think, but that's the way it is.

CHAKRABARTI: President Donald Trump wants to change that. As part of his global tariff smackdown, Trump says he's looking to raise tariffs or long-term duties on lumber imports. And on March 1st, President Trump signed an executive order calling for the immediate expansion of American timber production, end quote. Including from public lands. Trump spoke at the Oval Office about this issue the weekend before the executive order came out.

DONALD TRUMP: We're freeing up our forest. We're gonna be able to take down trees. Right now, we're so restricted environmentally, we're gonna be freeing it up with an emergency odor. We have an emergency odor, and we're gonna be freeing up our forests. We have more forests than almost anybody. And great lumber, great trees.

We don't need anybody's trees. We don't need trees from Canada or anybody else.

CHAKRABARTI: Jim Manke says he would welcome making it harder for Canadian lumber to flood the U.S. market. And he has the equipment to handle more lumber himself, but he's worried it's going to be hard to get back up to full speed.

MANKE: It would take probably 60 to 90 days to get those two shifts back in full production.

But trying to find people is the other big question mark. Where do we go to find them? The average kid in the Northwest, he doesn't want to work in a sawmill. He doesn't wanna get his hands dirty. He is elsewhere.

CHAKRABARTI: The other question is, remember those log cabins Alexis de Tocqueville observed? Not much has changed in the almost two centuries since then. To this day, more than 90% of new homes in the U.S. are wood framed. So if the price of lumber goes up, so does the cost of housing, which is why this hour we're gonna take a deep dive into the modern U.S. lumber industry, and Ryan Dezember joins us to help with that.

He's a reporter for the Wall Street Journal. He covers commodities. But lumber is his passion, I've been told. Ryan, welcome to On Point.

RYAN DEZEMBER: Thank you for having me.

CHAKRABARTI: We start with, started with Jim Manke, who's in the Pacific Northwest, a part of this country near and dear to my heart, but the lumber industry actually is vitally important to a lot of different regions in the United States.

Can you talk about that a little bit?

DEZEMBER: Yeah, sure. I think when we think of lumber, we think of those big giant Doug firs in the Northwest, and we think of Weyerhaeuser up there and that's still the case. It's still a strong industry there. But the industry has really shifted south.

The Southeast has become the dominant lumber producing area region of really the world. And that stems from back in the 1980s when, remember the farm crisis, and the government paid incentives to landowners to stop planting soybeans and cotton and things like that on marginal crop land and plant trees to feed the local mills, paper mills.

You think your paper cup that you all have given me some water. And that's probably from a Loblolly Pine from the South, two by fours. So the industry has shifted Southeast, not just from the U.S. North, Pacific Northwest, but also Canada.

CHAKRABARTI: Okay. Can I just jump in here for a second, Ryan?

DEZEMBER: Yeah. Yeah.

CHAKRABARTI: Because so you said this is since roughly the 1980s, so we're talking about, I guess, some of the trees were already there, but we're talking about trees that have, many of them have been grown since then, so they're pretty young. What kind of species are we talking about that can be harvested at such a young age and grow so quickly?

DEZEMBER: Yeah. So it's even shorter. Big timber growers can get a saw log, meaning a tree that's big enough to send to a sawmill to make, say, two by fours or a dimensional lumber in 20 some years now. And that's through, fertilization, genetics meaning, the breeding of trees to be straighter and grow faster.

And remember, in the south you have a year-round growing season. If you go up to the Maine North woods, you get about two, three months of growth. So imagine how much longer it takes a tree to grow in the two regions. And when I say Southern forest, a lot of that, it's a fun exercise to go on, like Google Earth or some satellite image and zoom in. And what you'll realize when you take a big green patch, you'll zoom in and you'll see it's in rows, much of the South timber is planted. So think of it less as the woods. More of a woodlot, right? It's a row crop. It's an unusual row crop with a 20-to-30-year rotation.

But that's one of the things that's made the south the dominant lumber producing area.

CHAKRABARTI: You said the dominant lumber producing area, not just in the United States, but did I hear you say in the world?

DEZEMBER: Yeah, you could go, you could look at Canada or Siberia and the north, the Taiga, you know?

And they of course have these old growth trees and spruce and fir, and their own varieties of pine. But in terms of growing timber and processing it, the industry has really shifted there. And a lot of that has to do with the duties that have been placed on Canadian lumber over the years and also environmental concerns there.

CHAKRABARTI: Yeah, we're going to talk about that in terms of the long fraught relationship between the U.S. and Canadian lumber in a second, but actually, what this makes me wonder, Ryan, is if particularly the Southeast is such fertile ground for lumber, why is it that we still have to import what, 30% of the lumber that we use?

DEZEMBER: There's different species, right? Of wood. And so a southern yellow pine is good for, it's fast growing. And when you plant rows of trees after, say, 10 years or so, you have to thin it to give room to the best specimens to grow and to make lumber. And you send those trees to the pulp mills, right?

And that becomes your Amazon delivery box or your paper coffee cup at Starbucks. The industry shift there. It's really ramped up over the last 20 years. You've had a lot of capital there and, you know, you can produce more there, and by the numbers, you could replace Canadian production, but it's not the same.

You think of Southern Yellow Pine, you're gonna probably be using that outdoors, it takes stain and waterproof treatment very well. But it's much heavier and harder to work with than the northern species spruce and varieties of pine that grow in colder weather, fir trees. So a lot of builders, when they're framing a house, they're going to want that softer Canadian soft wood, northern species.

So you're gonna have to have some substitution with the builders and that could take time.

CHAKRABARTI: Okay. And also then there's the cost factor as well.

Part II

CHAKRABARTI: Let's listen to Troy Jackson in Allagash, Maine. That's a town in Northern Maine near the Canadian border. Troy is a fifth-generation logger, but he says a lot of people have left the industry and it's changed his entire hometown.

TROY JACKSON: The town of Allagash probably had a thousand people in its heyday, we had our own school and stuff like that, and now we have right around 200 people and the majority of 'em are elderly people, retired. Be it people didn't wanna work in the logging industry or didn't feel like there was a solid future in it.

We've lost a lot of people. There's just no doubt that our population has been in decline. And I know things I think the government could do to make it better, we haven't had that type of leadership.

CHAKRABARTI: Well, Ryan Dezember is with us. He's the commodities reporter for the Wall Street Journal, knows a lot about the wood industry. And Ryan, in order to understand the potential impact that the Trump administration's ideas would have now.

I'd like you to actually go back in time with us. Because you hinted earlier that there's been sort of trade tension regarding lumber between the United States and Canada. What, for like more than a hundred years?

DEZEMBER: Yeah, this goes way back. You can even look at some of the original tariff.

We talk about a lot when we look at the previous sort of trade war era, the McKinley era more than a hundred years ago. Newsprint was, the tariff was eliminated on newsprint and all of a sudden, a lot of Canadian cheaper newsprint flooded into the country. It really killed then a new company called International Paper.

It really eroded their market share, which was like two thirds of all newsprint in America. So you have this debate over forest products coming over from Canada. Yeah, going back more than a hundred years. The latest iteration, of course, is around ... lumber. Dimensional lumber, think 2x4s.

And the crux of the argument is the American industry argues that because much of the Timberland in Canada is owned by the government, that the sawmills up there get it much cheaper than a sawmill could get it in the United States, where a lot of land is privately owned and it's a free market.

And so for many years, this latest, they call it the softwood lumber wars, there's academics who have dedicated their whole careers to studying this and it's been going on for a while in the last sort of iteration. And what the industry is bracing for later this summer is for those duties to jump from, call it, I think the average was about 14.5% last year, and they're gonna be more than 30%, more than 40% for some of the biggest importers into the U.S.

So that's gonna raise the price of that wood coming over the border dramatically.

CHAKRABARTI: Hang on for a second. So these were existing duties.

DEZEMBER: Yeah, these are existing duties. So when Donald Trump threatened his 25% tariff, that's on top of everything that was already going on. And that predates the last few presidents we've had, and those duties are based on very careful calculations on actual sales, margins.

These things where they examine the books of these lumber companies in Canada to come up with a rate. So if you remember during the pandemic, when lumber prices soared, that meant really good profits for the mills, wherever they were. So that's why we're seeing duties now looking retrospectively, going up so dramatically this year.

CHAKRABARTI: I see. Just to recap what you said, because a lot of the land in Canada's government owned, essentially the mills up there are getting the raw timber cheaper and so can sell it more cheaply here in the United States. Is that what you were saying?

DEZEMBER: That's the argument the U.S. industry makes.

And it's been successful in trade courts. Yes.

CHAKRABARTI: Okay. And so then these duties applied to those imports are designed to make U.S. timber more competitive.

DEZEMBER: Correct. They're a combination of what are known as countervailing duties and anti-dumping duties. So on one end, the argument that they get their raw material cheaper, subsidized from the local government, and then also that they're pumping product into the country cheaper than it can be made locally.

CHAKRABARTI: Okay. And so we're talking about finished boards.

DEZEMBER: The 2x4s that you'd see at Home Depot. Correct.

CHAKRABARTI: Yeah. Got it. The reason why I ask that is as I say often on this show, I grew up in the Pacific Northwest and I also remember a time when, and I don't know if this is still going on, but raw lumber was being felled in the Oregon forest where I grew up and that raw lumber was actually being sent abroad, sent to China for processing in the Chinese mills and then re-imported back into the United States. I don't know if that's actually happening very much anymore.

DEZEMBER: Yeah, there's some export log business to China and really Japan is the big buyer.

Because Japan, they make a lot, they're like us, they build a lot of homes with lumber, and they like an exposed wood. And they get that really pretty Douglas fir, that fine grain and beautiful wood that they import. There's actually, in the business, there's a grade of log called J-grade, that's set aside for the Japanese market.

CHAKRABARTI: I see.

DEZEMBER: And it's exported from the West. And that became controversial, if you remember, back in like the late '80s, early '90s when we had the controversy over the northern spotted owl in the Northwest.

CHAKRABARTI: Oh, do I. Do I remember.

DEZEMBER: Yeah. And that was really the start of the decline in the production from the National Forest.

CHAKRABARTI: Okay. We're going to get the voice of someone in the industry here in just a second. But now with all of this background in mind, the Trump administration says it wants to open up more public lands to salvage logging and logging in general.

We'll talk about that in a second, but tell me about what they want to do regarding timber tariffs.

DEZEMBER: The threat was 25% on top of the additional duties. Now, I'm a newspaper reporter. I heard that, I got all ready for it. It didn't come, whether it comes again, your guess is as good as mine.

But regardless of that 25%, again, the duty on this lumber is gonna basically double, more than double. So the price of that product coming in is gonna jump, and we saw prices really surge in the beginning of the year. Ahead of that, people stocking up prices of lumber futures rising to account for that.

And maybe possibly, we'll call it the Trump tariff, the 25%. And that's come out of the price lately. And we also, as we know, we have still elevated interest rates that are keeping the housing market flat.

CHAKRABARTI: Okay, so Ryan, hang on here for just a second because now I wanna bring Scott Dane into the conversation.

He's in Gilbert, Minnesota. He's the Executive Director of the American Loggers Council. It's a national advocacy group that represents nearly 10,000 companies and 50,000 employees in the logging and log truck trucking industry. Scott Dane, welcome to On Point.

SCOTT DANE: Thank you very much, Meghna, I appreciate the opportunity to join the discussion.

CHAKRABARTI: It's great to have you. Can you tell me a little bit about some of the changes that you've seen in the industry over the past couple of decades?

DANE: I've been working in this industry, representing the timber industry, for 21 years in Minnesota and now nationally. And the biggest change that I've seen, the two biggest changes, but the biggest change, the primary one, is the loss of markets.

And Ryan, you did a phenomenal job on framing the situations. Great job there. But we've lost substantial markets across United States and Minnesota. We've lost over half of our forest products mills over the last 10, 15 years and stuff. And, in the last 30 months, we've lost about 60 primary mills in the United States, as well as a hundred secondary mills or smaller mills in the hardwood sector.

So the loss of market capacity in the United States has been alarming, and we welcome the Trump administration's recognition of that and the steps that they're taking to help rebuild the forest products industry in the United States.

CHAKRABARTI: Can you tell me a little bit more about why there's been this dramatic shutdown of mills?

Is it simply because there's just less demand for the products coming out of those U.S. mills in comparison to the supposedly cheaper finished lumber that's coming from Canada?

DANE: That's part of it. And as Ryan mentioned, the Canadian lumber coming in is one thing, but we just had a major mill closure announcement last week by Georgia Pacific, laying off 550 people in Virginia that made plywood.

They're shutting down plywood mills and they shut one down in Washington State as well last week. Or announced a shutdown of it, while we're still importing plywood from Brazil, Russia and Canada. So it's those market challenges that have undermined the American domestic timber and forest products industries, I suppose.

CHAKRABARTI: And Scott, forgive me for being a little dense here, but you're identifying what seems to be like a real irony here. We have all this demand, but Georgia Pacific shut down this plywood mill. Why?

DANE: I'm sorry, I didn't mean to interrupt you.

CHAKRABARTI: No please, go ahead.

DANE: It's simply a matter of getting it cheaper. The paper mills in the United States that use pulp are now importing pulp, instead of producing it domestically, they're importing it from Brazil. So it's all a matter of economics, and that's unfortunate, because aside from the markets that we're talking about, this really all boils down to forest management. If we don't have markets, we don't have forest management. And that's why our forests are in this condition that they're in.

CHAKRABARTI: What, tell me more about what you mean by forest management.

DANE: Forest management just means to be actively managing. The United States practices civil, cultural sustainability, SVA culture is the science and art of cultivating timber.

And as an example, since we're talking about the national forests in the 1980s, '90s, we were harvesting 13 billion board feet off of national forests. Now we're down to 3 billion board feet off of national forests.

And that's contributed to the over dense forest particularly in the South, excuse me, particularly in the North-Northeast Pacific states. And that's resulted in the forest dying because of their being over dense and the millions of acres a year that are burning. So we need to thin these forests, and that's part of what the president's executive order is to mitigate wildfire threats. By managing the forests.

CHAKRABARTI: So we'll talk about more about that in just a second here. But Ryan, let me bring you back in. What are your thoughts on even the plywood mill closures that Scott Dane has been mentioning?

DEZEMBER: Yeah, so it's interesting, right? Like even in the Southeast where, you know, that's in the U.S., that's the cheapest log, right?

That's the cheapest source of the raw material, whether you're making cardboard boxes or plywood or 2x4s. We saw mills close in the southeast last year, which is that sort of red alert, right? If somebody's having, struggling with the economics there, it's a problem.

And a lot of that has to do with the housing market interest rates. As Scott mentioned, the Brazil imports of pulp, they grow eucalyptus down there and it takes five or seven years or something versus where he's at. You're talking decades, not years, for trees to reach maturity.

You have these dynamics always going on. I would say, one thing that's really interesting and that stood out to me in this executive order, there's pretty broad consensus that the forests need to be thinned and that there's wildfire issues and things like that.

In terms of lumber, I just, I think it helps to frame it that the forest industry is, despite what we're talking about, imports and exports the raw materials, it's a very local industry, right? You don't take logs from Alabama and take 'em up to Minnesota. You can only fit so many on a truck before the weight's too big for roads and things like that.

And Scott probably knows all those rules and regulations. And even if you could, you get to a point where the diesel and the man hours outweigh what you'd make. So it's a very local industry. So when you talk about one of the outcomes, there was a memo out of the Forest Department, or I'm sorry, the Forest Service in response to Trump's requests for this information and for this ramp up.

And they said 25% increase in production in the next few years. And that sounds like a lot, but when you look at it, as Scott was saying, that the National Forest output has tumbled since the early '90s in the Spotted Owl era. And so if you talk about 25% from the level of harvest now, you're talking less than 1% of all U.S. harvest now.

That's a drop in the bucket for the overall market, but in local areas that could be really helpful for a particular mill. Because it's very regional.

CHAKRABARTI: Okay, so both of you just said something really interesting there in terms of helping us understand. The volume of wood we're talking about.

Scott, did you want to pick up on what Ryan said? That the 25% increase may sound like a lot, but is it really when it comes to where the forests and the mills actually are?

DANE: Ryan had a great point. All forest products industries are local, and that being said, the 25% will have a major impact on the Pacific Northwest mills because those states are the forested lands.

And those states represent over 50% to 75% of the timber lands. So when you're talking about increasing it out there, where we sawmill closures hit hard, California at one time had 150 mills down to 27 mills right now. Sawmills. It is local. Will it have an impact, a large impact on the Southeast, where most of the land is privately managed?

No. Will it have an impact on the Pacific Northwest? Absolutely.

CHAKRABARTI: Can we though ramp up, let's just say theoretically that this happened, there's a 25% increase. The regulations around not just salvage logging, but other logging in public lands were relaxed. So this could happen.

Scott, do we actually have the domestic milling capacity to process all that wood quickly?

DANE: I'm glad you brought that up. The answer, the short answer is yes. I wanna explain that a little bit. The U.S. sawmills are operating at about an average of 72% capacity. Okay. So they could increase their capacity, and we've spoken to 'em all.

By 13% sustainably. And maybe even a little bit more than that, if the wood supply is there. That we say the Canadian imports represent 25% of our consumption, you're using the number 30%. So it's 25% to 30%. But if we could increase domestic production by 13% with the current infrastructure that we have, that could potentially offset 50% of the Canadian imported wood.

Now, one thing to think about, that Canadian wood is not gonna stop coming to the United States with these potential duties that we're looking at later in the year, it'll just level the playing field for our domestic mills to compete against that wood. But 60% of what Canada produces is exported to the United States.

They have no other market, nowhere else to go with that wood to offset that much production.

Part III

CHAKRABARTI: We did contact the U.S. Department of Agriculture and the U.S. Forest Service for comment on the Trump administration's desire to expand domestic timber production by 25%.

We did not receive a response from either agency. But we also have to talk about one of the reasons why domestic timber production has had its ups and downs over many decades in this country. And that is the legitimate environmental concerns around logging. Randi Spivak is the Public Lands Policy Director at the Center for Biological Diversity, and she's worried the executive order could unleash chainsaws on America's national forests.

RANDI SPIVAK: That executive order basically said, increase the number of board feet. Look for every way to shortcut environmental review and the ability for citizens to have input. And so it's significantly going to change the way the Forest Service does business. Their focus is going to be on how many board feet can we produce.

CHAKRABARTI: About 8% of the land in the United States currently are national forests. Spivak says they're managed not just for timber harvesting, but also for conservation and recreation, and she does not want those other things to take a backseat.

SPIVAK: And it is true the forest service is not wholesale liquidating our ancient forest like they were in the '80s and '90s.

But look, we had to hold on to our remaining mature and old growth forest that we have left. Those trees, those larger older trees, they produce the more board feet, think of it. The larger the tree, the more the board feet you're gonna get. It's also the more commercially valuable timber. However, those older, larger trees, they're also the most important ecologically. Why? So many species of wildlife depend on those tall canopies and multi branches. If you've ever hiked in an older forest, you could just see the beauty of it.

CHAKRABARTI: At the same time, Spivak does agree that some forests need thinning for fire suppression and other responsible land management.

That's a change in forest management that we talked about over the past 50 years or so. But she wants guardrails in place.

SPIVAK: The problem is some forest plans have a little bit protection, but by and large, no. They're completely inadequate. And the one region of the country that does have fairly good protection, to the Northwest forest, so Oregon and Washington and Northern California, those plans are being redone now because the timber industry has been pushing to open up more maternal growth forest to logging.

Look, are some, is there room on our national forest for some ecologically appropriate tree removal? Yes. What we are worried about is Trump's executive order. The timber industry always clamoring for more. 

CHAKRABARTI: So that's Randy Spivak, Public Lands Policy Director at the Center for Biological Diversity. Ryan Dezember.

Can you comment on that or what you know about the downstream plans that are being put into place following this executive order? Are they specific in the type of tree that could be removed or where the salvaging could occur? To take into account the point that Randy Spivak there is making about protecting the kinds of trees that are actually ecologically significant in these forests.

DEZEMBER: Yeah. Along with a memo that the Forest Service put out, I think a couple weeks back now, in response to Trump's order, basically outlining what they could do. There was a map, and it showed where they thought they could increase harvest or clearing thinning rather, and that's, it's basically where the national forests are.

So think the North and the West and some of those areas in the lake states. Michigan, Wisconsin, where, you know, the loggers of the 19th century just ran rampant and then would just leave when there were no trees. And all that land found its way back to the government and was replanted by the Civilian Conservation Corps and just naturally regenerated.

So wherever there's National Forest, and I wanna make sure there's a difference between a National Park and a National Forest, in terms of how they're managed. And when Theodore Roosevelt and Gifford Pinchot set up the National Forest in 1905, you have to go back and realize we were in a world of wood.

We used it for fuel at home and for transportation. Even the sidewalks were made out of wooden planks back then. And there was this idea up until then that the forest was limitless, right? That you started with de Tocqueville and his marveling at the expanse of the wilderness and the forest.

And by then there wasn't so much. And of course, they were narrow-minded in the species that they cut and everything else was scrap and just wastefully just run over. But you look at those areas and it tracks that. Now when they talk about thinning, you're not going to get a lot of these, you're not talking about cutting big, giant trees down and old growth, you're talking about low value, smaller stuff.

It might be pulp, it might just, it might be biomass, sort of wood pellets. It might be nothing. It might just be like when you clean out your garden in the spring. So we will have to see where the logging is. But I would suspect in the Northwest, there's those old trees.

One of the issues they're going to have there, in terms of milling that wood, is because that wood was left on the stump growing. And protected since the early '90s, it's gotten a lot bigger.

And the CEO of Weyerhaeuser on his earnings call, a few weeks back was asked about that.

Because they operate giant sawmills in the Northwest. They have their own Timberlands. And he said something really interesting, which is a lot of those trees are too big for the mills.

CHAKRABARTI: Oh, wow.

DEZEMBER: So we'll have to see about that. But yeah. There's a saying, you match the metal to the wood. You build a mill that can handle the trees that are in your vicinity that you can economically deliver to the mill.

And so there's gonna be issues like that.

CHAKRABARTI: Scott, I hear you wanting to jump in. Go ahead.

DANE: You can tell, huh? Okay. Thank you.

CHAKRABARTI: (LAUGHS)

DANE: Ryan gets me all excited and pumped up. He's really nailing this. A couple things to circle back real fast. You talked about reaching out to the U.S. Forest Service, USDA.

I spent a lot of time there in the last week or two, and they've been a great partner. In fact, the American Loggers Council a year ago signed a memorandum of understanding between the U.S. Foreign Service and the American Loggers Council, recognizing that we provide the tools and the resources for them to accomplish their forest management objectives.

And they've been supportive regarding that. You talked about going to National Forest, I see headlines that the executive order is going to open up the National Forest to the timber industry. The point of the matter is as Ryan mentioned, the national forests have been open to forest management for a hundred years, so this is really nothing new.

And you mentioned Teddy Roosevelt, who established a U.S. Forest Service in 1905, if I'm not mistaken. And the first chief of the Forest Service was Pinchot. Teddy Roosevelt said, first and foremost, you can never forget, afford to forget for one moment what is the objective of the forest policy?

Primarily, that objective is not to preserve forest because they're beautiful, though that is good in itself, not to preserve them because they are refuge for the wild creatures of the wilderness, though that too was good in itself. But the primary objective of the forest policy as of the land policy of the United States, is the making of prosperous homemaking in our country.

Everything, every other consideration comes as secondary. The whole effort of the government in dealing with the forest must be directed to this end. So forest management has always been, even from our conservation president, part of the management of the national forest.

CHAKRABARTI: Yes. No and point well taken, which is why I appreciated the fact that Ryan wanted to make the distinction between the national parks, which are purely for conservation, versus our national forests, which have this multifaceted set of uses and a mission. But I wanted to ask you both a couple of questions about those different facets. And Ryan, let me just start with you here. Because to your point a little earlier, you had mentioned about where increased logging in public lands would be located.

And there's a 2024 government accountability office estimate that said that in that year, most of the Forest Service logs harvested in this country came from Oregon, Washington, and two regions in the Southeast. So I guess the idea is that most of the additional logging that would happen would come from those regions as well.

But how much does the Trump administration see as actually potentially loggable? Because from what I understand, agriculture Secretary Brooke Rollins has designated 112 million Forest Service acres as worthy of quote-unquote emergency management. That's 69%. No, I got that wrong. That's 60% of all national forest lands.

So Ryan, that kind of sounds like the Trump administration is setting up a situation where there could actually be a massive increase in logging on public lands.

DEZEMBER: Yeah, I think, it's not going to happen overnight, right? You need mills, you need workers. Your first guest, I've already forgotten the name.

CHAKRABARTI: It's okay. Jim Manke.

DEZEMBER: He talked problem finding employees, right? And think about outside of the Northwest and Seattle, Portland, think about where the trees are. There's not a lot of people there. It's hard to get somebody to want to go work in a sawmill and in a modern sawmill, we're not talking like, just like brute force, broad shoulders, labor, there's some of that, but you need electrical engineers.

These are computerized giant facilities that cost hundreds of millions of dollars to build, so you're gonna need a market. And we certainly have that in certain areas. I think, we talked earlier about, if a forest were opened up in a certain area it could be a great help to local mills.

Even if that mill is running at capacity. The more supply you have, the lower the price. Think about it like oil.

CHAKRABARTI: Yeah. But one more follow up on that, because we have been focusing for obvious reasons on not just the forest, but then the timber industry that relies on those forests.

But forests aren't just for lumber, right? They actually serve a lot of purposes in the communities that they're located in. I was seeing this quote from Mary Erickson. She's the retired supervisor of the Custer Gallatin National Forest, and she says that the community economic drivers that the forests support are recreation first and foremost. Then mining, then livestock grazing, and wood products is a very distant fourth. So big change in how those forests would are managed could actually have a potential negative economic impact on those very communities.

Ryan?

DEZEMBER: Yeah, it's possible. It's hard to know what will happen. Because again, so much is dependent on the market and when the Forest Service sells trees, they don't just cut down all the logs and then put a for sale sign on 'em. They run these processes, auction type sales processes.

So I don't, I wouldn't expect. It would be a really big change for them, just to just go and clear cut and mow down sections of forest, outside of the thinning that's wanted to be done and desired. But that would be really unusual. That would be news. Again,

you go back and when we talk about the overall impact, you're talking, it sounds dramatic to raise lumber production, I'm sorry, timber harvesting 25%. Again that's 1% of the overall market. It's gonna be, it could be a lifeline to a local mill. It could be seen as a tragedy for people worried about a particular species or an area.

But in the grand scheme of things, most of the wood is still gonna come from the Southeast. The Northwest is important because that's where the same trees grow that we would get from Canada. Same species. So that's where the focus is there. And replacing that Canadian import lumber.

CHAKRABARTI: Right.

Actually, I also mentioned earlier how another way to do it is to maybe get the housing industry to change the kinds of wood that it prefers to use. That would seem to be like quite --

DEZEMBER: We're starting to see that. Okay. We're starting to see that a lot of, I've heard a lot of roof truss manufacturers.

When you look, if you go up in your attic and you see the crisscross of 2x4s or whatever that hold up the roof, in a lot of cases those are made prefabricated in a factory and delivered to a site and a lot of those are being made out of Southern Yellow Pine now.

CHAKRABARTI: Okay. So there's one more point that I want to hear Scott on, and we've been talking about domestic production, but we do have to just once again touch on those additional 25% tariffs if they ever happen. Who knows? And Scott, I want you to listen to Troy Jackson. We heard from him earlier. He is a fifth-generation logger in Allagash, Maine.

And he does not support really the idea of lot higher tariffs on wood because he's worried about retaliation from Canada. Also, he's worried about high interest rates and housing construction prices hampering the demand overall for wood. And he says tariffs could add unnecessary costs to his region.

JACKSON: Mill owners and things like that, they're unsettled. They don't know if they want to buy lumber. They certainly don't want to buy lumber, and have it sawed in Canada and then have it sit over there that they can't export it back in the United States. And that'll cause problems on the ground for logging contractors. If there's no market, then they're not gonna work. And landowners aren't gonna just give out free opportunities for people to go to work if they can't sell their lumber. We're in a holding pattern right now, but it does not look good.

And the uncertainty that this is all causing, even if the tariffs are taken off, is going to be problematic.

CHAKRABARTI: Scott, we have about a minute left. I'm just wondering your view on tariffs, will they happen? Won't they happen? Would they actually help the industry in the long run?

DANE: Tariffs, softwood tariffs were not imposed on April 2nd, and the reason being is the second executive order that the president issued was addressing the threat to national security from the imports of timber and lumber.

As Ryan said, we expect that there'll be additional duties imposed. So I don't think tariffs are really gonna be a factor when it comes to lumber in the United States, but it's a very complicated situation. Because when we look at softwood lumber tariffs, and I live in Minnesota. And I've watched rail car after rail car come south through Minnesota every single day full of Canadian lumber and go back empty.

So that's a problem for us. But when you get to the Northeast and there you have the markets are Canada, they'll harvest a timber in Maine, they'll ship it to Canada. Canada will process it. And then ship the finished product back to the United States. So there could very well, it's a complicated issue and we want to make sure there are no unintended consequences that impact other sectors of the timber industry.