Newest Version of Hardwood Check-Off Includes Significant Changes Affecting Scope & Voting Procedure

Thanks to the NHLA for working to keep the hardwood lumber industry informed. This update was received today.

Dear NHLA Members and Hardwood Industry Friends,


As previously announced, the "REVISED" Hardwood Lumber and Hardwood Plywood Promotion, Research and Information Order (Hardwood Check-Off) has been released by the US Department of Agriculture. Although extensive in detail with minor clarifications, the new Order has two changes that are a significant from the original.



Background:

In June 2011, USDA received a proposal for a national research and promotion program for hardwood lumber and hardwood plywood from the Blue Ribbon Committee (BRC). The BRC is a committee of 14 hardwood lumber and hardwood plywood industry representatives. The BRC proposed a program that would be financed by an assessment on hardwood lumber and hardwood plywood manufacturers and administered by a board of industry members selected by the Secretary of Agriculture. The purpose of the program would be to strengthen the position of hardwood lumber and hardwood plywood in the marketplace and maintain and expand markets for hardwood lumber and hardwood plywood. A total of 939 comments were received in response to the original proposed order. In response the USDA has submitted a "revised" Order now open for comment.



Two Significant Changes:
After a staff review of the 46 pages included in the revised Order, two changes from the original Order will have significant impact to the Order.



1. The definition of "Hardwood Lumber Products" has been changed to mean Green/Air Dried/Kiln Dried lumber that has been transformed into products that remain boards meeting or exceeding the level of "Grade 3ACommon" as defined by National Hardwood Lumber Association Rules for the Inspection of Hardwood & Cypress effective January 1, 2015 or equivalent proprietary standard. As such, hardwood lumber would not include industrial products which remain in board or block form such as ties, cants, crane mat material and pallet stock.



2. USDA will now require approval by a majority of manufacturers voting in the referendum who also represent a majority of the volume represented in the referendum. Only manufacturers who would be paying an assessment under the program would be eligible to vote. (Note: We asked USDA for clarification on this and were told there would be none until after the comments)



Additionally, the Revised Order clarifies some definitions, and restates that lumber to be exported is included. It also clarified that the species Yellow Poplar (Tulipwood) was to be included, and that Air Dried lumber is to be treated equal to Kiln Dried lumber.




Proposed Action for the Hardwood Lumber Industry:



Please take time to comment at the link below. In addition to your general comments, the USDA is reaching out to the industry to get answers on very specific questions regarding the programs viability.



Regarding Hardwood Plywood:

What are the benefits and the drawbacks for including hardwood lumber and hardwood plywood together in the same research and promotion program?
How would the proposed program benefit the hardwood plywood sector of the industry?
What types of promotion programs could be envisioned by the industry for hardwood plywood and how would this impact the hardwood lumber sector of the industry?
What impact would excluding hardwood plywood have on the expected amount of assessments to be collected under the proposed program?
What impact would excluding hardwood plywood have on the proposed Board structure?

Regarding Assessments:

Should the assessment computation be revised? If so, how should it be revised and what would be the impact on the projected amount of assessments to be collected under the proposed program?
Should the proposed rates of assessment on any of the four types of covered hardwood be revised? If so, to what level and what would be the impact on the projected amount of assessments to be collected under the proposed program?


Reminder - the comment period is now open and will close on July 9!

Submit comments online at: http://www.regulations.gov or faxed to 201-205-2800 or to the Promotion and Economics Division, Fruit and Vegetable Program, AMS, USDA, 1400 Independence Avenue, SW., Room 1406-S, Stop 0244, Washington, DC 20250-0244. All comments should reference the document number and the date and page number of this issue of the Federal Register.


NHLA will continue to follow other changes or clarifications and bring those to the industry.


FOR FURTHER INFORMATION CONTACT: Patricia A. Petrella, Marketing Specialist, Promotion and Economics Division, Fruit and Vegetable Program, by phone at 301-334-2891; fax at 301-334-2896; or email at [email protected].