Lumber will bring us together
Instead of yet another bleak housing market report, we would like to share some wonderful post-Cold War news: American home builders visiting St. Petersburg have offered to share their top-secret technology, in exchange for… softwood lumber.
Why the cross-continental bargaining? Because as of next month, our very own Canadian neighbors will be starting “a complex system of border taxes and quotas that will artificially raise lumber prices.”
In short, those damn Canadians have forced us to share our precious housing secrets with those damn Russians. Can’t a patriarchic global superpower ever catch a break?
Our first press release from SAINT-PETERSBURG is after the jump.
– Max Abelson
U.S. HOME BUILDERS SEEK NEW LUMBER SOURCES IN RUSSIA
SAINT-PETERSBURG, Russia – Oct. 11 – Addressing the International Forestry Forum here, U.S. home builders offered to share American home building technology with their Russian hosts and encouraged them to boost exports of softwood lumber and other wood products to America.
“We support opening up competition in the U.S. lumber market because we know that it will be beneficial for those families in our country who want to buy homes,” said Jerry Howard, executive vice president and CEO of the National Association of Home Builders (NAHB). “We also appreciate the benefit it will bring to our home builders, who are seeking a steady supply of affordably priced lumber.”
Howard and NAHB Immediate Past President David Wilson, a home builder from Ketchum, Idaho, represented NAHB and the International Housing Association (IHA) at the conference. NAHB serves as the secretariat of the IHA, which was established in 1984 to provide a forum for home builders and related industry groups around the world to share information and discuss issues related to the housing industry.
As a result of environmental and regulatory policies that have greatly reduced timber harvests from public lands, America today does not have the domestic capacity to meet its demand for lumber. Last year, more than 38 percent of the lumber used in the U.S. was imported, with Canada supplying the bulk of that amount.
However, a new softwood lumber accord between the U.S. and Canada that is scheduled to take effect on Nov. 1 will create a complex system of border taxes and quotas that will artificially raise lumber prices during periods of normal or slow demand, and thereby harm housing affordability. The pact is also expected to cause new uncertainties for U.S. builders over the availability and price of Canadian lumber.
“Access to a reliable, steady supply of lumber is the lifeline for any American home builder,” said Wilson, who provided conference participants with an overview of light-frame wood construction techniques in the U.S. housing industry. “We believe that lumber trade barriers impose an unreasonable burden on U.S. home buyers and on the industries that depend on adequate, affordable supplies of lumber to provide the housing and other vital goods and services America needs.”
While Howard noted that the new trade pact is a misfortune for Canada, he said it represents an opportunity for Russia and the rest of Europe to increase lumber exports to the U.S. over the long term.
“Today, the U.S. is overly reliant on Canadian imports to meet its lumber needs,” said Howard. “We are reaching out to you to correct this problem and we are looking to Russia to add equilibrium to our market for this essential commodity for the home building industry.
“The Joint Center for Housing Studies of Harvard University projects 14.6 million household formations over the next 10 years,” he added. “In the next 10 years, we conservatively estimate that we will need to construct 18 million new homes. We want to work with you to open up this new trading opportunity.”
During their week-long visit to Russia, Howard and Wilson also held productive talks with representatives of the Builders Association of Russia, the Union of Timber Manufacturers and Exporters of Russia, Ilim Pulp Enterprise, BaltRoss, Slavyansky DSK and the Association of Wood Housing.
The meetings come one week after Howard visited Stockholm to discuss with Swedish trade and industry officials ways to secure new import sources of softwood lumber and other wood products and to export American building systems and log homes technology.
NAHB’s European visits to seek additional sources of softwood lumber follow the association’s September board meeting in Salt Lake City, where policy was instituted to address the pending U.S/Canada trade pact. A resolution was adopted that calls on NAHB to work with the governments and industry of other countries to facilitate softwood lumber imports and encourages the use of alternative building materials wherever practical in order to protect the interests of American home builders and consumers. Pre-existing policy urges the U.S. government to open up additional forest lands for logging.
ABOUT NAHB: The National Association of Home Builders is a Washington-based trade association representing more than 235,000 members involved in home building, remodeling, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction. Known as “the voice of the housing industry,” NAHB is affiliated with more than 800 state and local home builders associations around the country. NAHB’s builder members will construct about 80 percent of the more than 1.93 million new housing units projected for 2006, making housing one of the largest engines of economic growth in the country.