Copyright 2002 Federal News Service, Inc. Federal News Service
February 13, 2002, Wednesday
SECTION: PREPARED TESTIMONY
LENGTH: 5088 words
HEADLINE:
PREPARED TESTIMONY OF RODGER SCHLICKEISEN PRESIDENT, DEFENDERS OF WILDLIFE
BEFORE THE SENATE FINANCE COMMITTEE
SUBJECT - U.S.- CANADA NEGOTIATIONS FOR A BILATERAL
SOFTWOOD LUMBER AGREEMENT
BODY: Mr.
Chairman and Members of the Senate Finance Committee, we appreciate the
opportunity to discuss the present lumber trade dispute between the United
States and Canada. My name is Rodger Schlickeisen, and I am president of
Defenders of Wildlife, a non-profit biodiversity advocacy organization with over
1,000,000 members and supporters in North America.
I.
Overview and Summary
It is not everyday that we are in
agreement with the U.S. timber industry, but today we stand together on one
fundamental issue: that the Canadian timber industry is massively subsidized by
both the federal Canadian government and the various provincial governments.
These illegal subsidies not only harm the U.S. timber industry, but also inflict
significant and major injuries to American and transboundary habitats, as well
as harm to forests in Canada that are of continental and global significance.
Only by understanding the full nature of these present subsidies can we move
forward with durable solutions to this longstanding dispute between two nations
that are otherwise friendly neighbors and close allies.
This testimony is not only endorsed by our principal U.S. environmental
allies in this effort, such as NRDC and the Northwest Ecosystem Alliance, but
also supported by many environmental and citizens' groups on both sides of the
border, who realize that fundamental forestry reform m Canada must be addressed
in the current softwood lumber negotiations.1 We do not oppose continued logging
in Canada, nor do we oppose trade in softwood lumber. What we oppose is the
literal liquidation of all wild forests in Canada in a manner that is
economically unsustainable, ecologically destructive, and highly distortive of
truly free trade.2 Any meaningful solution to the present impasse, consequently,
must be grounded in the reality that "the market" is not working with regard to
Canadian lumber.
While my counterpart from the
Coalition for Fair Lumber Imports (CFLI) will address some of the subsidies
granted to the Canadian timber industry -- for example, the administratively set
and exorbitantly discounted stumpage fees charged to Canadian timber companies
to actually cut down trees -- I'd like to focus my limited time this afternoon
on the intertwined subsidy issues of tenure monopolization and weak
environmental protection. That is, because the Canadian timber industry is
dominated by a relatively small number of companies, who receive free and
virtually unfettered long-term access to forested areas, the governments of
Canada are either unable or unwilling to meaningfully regulate the Canadian
industry's behavior. In addition, we do not see how the significant stumpage
price disparity between the two countries can be rectified without examining
reforms in the Canadian tenure system, which helps shield Canadian timber
companies from the competitive and open markets. Subsidies based on weak
environmental regimes are discussed immediately below.
II. The Clear Linkage Between Harmful Trade Subsides and Environmental
Degradation
From the perspective of science-based
environmental protection of shared forest ecosystems, an end to the harmful
subsidies now granted to the Canadian industry would unequivocally aid the
protection of imperilled species and habitats. "Regulatory relief" to Canada's
timber industry, secured either from weak environmental standards or from lack
of environmental enforcement, clearly serves as a financial "pass back" to the
Canadian industry.3 Thus, if the Canadian timber industry cannot make profits
based upon artificially low stumpage fees, then the provincial governments will
once again reduce environmental protection standards to lower costs.
To the Canadian timber industry's bottom-line, there
simply is no difference between these "lack of environmental protection"
subsidies and other economic subsidies.4 Estimates of the total amount of
harmful subsidies from weaker environmental protections granted to the Canadian
timber industry total at least hundreds of millions of dollars annually. Recent
proposed "result-based" changes by the existing B.C. Government to the B.C.
Forest Practices Code could significantly increase these subsidies. See
Attachment 1 from Vancouver Sun, 25 October, 2001 ("Victoria takes axe to FRBC,
prepares to 'streamline' Forest Practices Code; Goal is to trim delivery
costs").
In order to get a handle on the magnitude of
the environmental lawlessness and the concomitant damage occurring in Canadian
forests, at least three types of harmful subsidies from weak environmental
protection must be identified:
- Subsidies granted by
the provincial governments for lax and poorly enforced forest practices codes.
Issues here include the lack of meaningful environmental assessments, mandatory
high-cut levels with over-reliance on large clear-cuts, lack of riparian habitat
protection, and non-existence of binding ecological indicators on logging and
disturbance actions. By way of comparison, the provincial forestry codes in
Canada are far weaker than the standards in the U.S. National Forest Management
Act.
- Subsidies granted by the federal government and
certain provincial governments such as Alberta and British Columbia by failing
to possess an Endangered Species Act (ESA). Indeed, the current federal
legislative proposal supported by the ruling party of Prime Minister Chretien
does not contain any mandatory habitat protections, even on federal lands in
Canada. This discrepancy greatly harms U.S. ecological interests, and puts the
U.S. timber industry at a distinct competitive disadvantage.
- Subsidies granted by the federal government for failure to enforce
the federal Fisheries Act, which requires protection of riparian habitat. Last
year, the Natural Resources Defense Council, along with Defenders and the
Northwest Ecosystem Alliance, calculated that this subsidy gave the timber
industry in British Columbia over $243 million (CND) annually in savings.
Despite these severe problems, which are harming U.S.
workers5 and U.S. listed species such as the grizzly bear, woodland caribou,
bull trout, lynx and marbled murrelet, there are viable solutions in sight. Step
one in reaching a solution, however, entails the two countries firmly
acknowledging the critical connections between forest management practices and
fair trade. Once this point is reached, the formula for successful negotiation
will likely involve a sliding scale system of compensatory duties that decrease
over time as reforms in Canada are verified by an independent binational body.
If the linkage between environmental protection and harmful trade subsidies is
not made in the framework for future negotiations, any agreement reached will
not be durable or long-lasting because of the Canadian industry's ability to
recoup costs through poor ecological stewardship.6 III. Subsidies Granted to the
Canadian Timber Industry
Three core categories of
subsidies have a major impact on binational forest protection: 1) stumpage fees,
2) tenure system issues, and 3) environmental compliance problems.
A. Pricing (Stumpage)
In the
United States, the vast majority of timber on both public and private lands
alike is sold in competitive markets.
In Canada, the
forested land is primarily owned by the province and the timber is sold to a
handful of large timber companies far below market value through longterm
tenures. In fact, ninety-five percent of the land in British Columbia, by far
the largest exporter of softwood lumber in Canada (CN$ 6.88 billion in 2000), is
owned by the province.7 As a subsidy to the Canadian timber industry, stumpage
fees are administratively set one-third to one-quarter of the true market
price,s These low stumpage rates are "based on government's revenue objectives
rather than an accurate assessment of what the timber would be worth in a
well-functioning market situation."9 Estimated subsidies to the BC timber
industry for one year, 1999-2000, ranged from C$2.8 billion to C$3.6
billion.l0
One technique called 'grade-setting' allows
the logging companies to successfully manipulate the stumpage system by
circumventing higher- end stumpage rates. By unloading the worst quality wood
from the cutblock first, a low stumpage rate assessment is triggered for all the
wood, even though higher-grade logs are removed later. Researchers at The Sierra
Legal Defense Fund estimated that coastal companies in British Columbia saved CS
138 million between 1998 and 2000.'1 In response to all these problems, a number
of government commissioned blue-ribbon panels have recommended the creation of
competitive and transparent regional log markets, with sufficient participation
to prevent price manipulation.
B. Tenure System
Through long-term tenure (or license) agreements, the
provincial governments provide logging companies security of access to a
specified timber supply, free of charge. In exchange, tenure agreements require
companies to process the wood at particular mills (with the intention of
providing employment and community stability) in addition to paying stumpage.
However, the BC government has been permitting more and more timber companies to
shut down appurtenant mills, but nonetheless to retain control over their
licensed wood supply.12
Fourteen large companies
control a full two-thirds of the provincial wood supply in BC.
While the government provides enormous tenures coupled with an almost
automatic license renewal, competition is non-existent. Overall in Canada,
thirteen timber companies possess tenures each as large as all of Switzerland,
accounting for roughly half of Canada's total forest tenures.13 The present
tenure system does not promote fair competition or good land stewardship. Tenure
take-back and redistribution have been recommended by a wide variety of Canadian
stakeholders.
C. Forest Management and Environmental
Protection
As discussed in the overview and summary,
supra, the Canadian timber industry operates under weak and poorly enforced
environmental protections. At present, there is no accepted binational mechanism
in place to gauge the effectiveness of Canadian forest-related environmental
laws, or their level of enforcement. Because it is obvious that environmental
compliance is an area targeted by the Canadian timber industry for "pass backs,"
weak and/or poorly enforced ecological standards must not become a way in which
a new binational agreement is circumvented? The linkage between harmful trade
subsidies and environmental degradation must be maintained in any future
softwood lumber negotiations. This central issue cannot be emphasized enough.
IV. The Overcutting of Canada's Forests
Without the subsidies, many of Canada's forests would simply be
uneconomic to log. Wood priced well below market value -- sometimes offered to
the Canadian industry for as low as $10 for a full track load or .25 (one
quarter) for a cubic meter -- provides a perverse incentive to cut more trees.
As logging companies move to expand timber production, primary growth forests
are increasingly harvested in response to the bevy of subsidies available to the
companies.
In fact, more than 90 percent of timber
harvested in Canada comes from old-growth forests? Throughout all of Canada,
logging companies are harvesting wood at a rate 25% above sustainable economic
levels, while in B.C. that number moves to 40%? Weak or no provincial endangered
species acts encourage logging in the habitat of endangered and threatened
species such as the woodland caribou and the grizzly bear, undermining millions
of U.S. dollars spent every year under the ESA to protect these fragile species?
Tenure agreements that mandate minimum cut levels exacerbate this problem. As
the Bush I Commerce Department aptly stated:
The
extensive margin means that, at any particular stumpage price, only certain
categories of stands can be profitably harvested. As the price of stumpage
drops, more and more stands become economically accessible, which allows the
supply of stumpage to increase. The intensive margin concept applies to trees
within a stand that is currently economically accessible. It recognizes that,
within each stand, there are certain categories of trees that cannot be
profitably harvested at a given stumpage price. If stumpage prices are lowered,
the intensive margin is expanded so that the formerly unutilizable trees within
a particular stand can be profitably harvested, thereby increasing the supply of
timber. 57 Fed. Reg. 22570, 22589 (May 28, 1992).
V.
U.S. Homebuilders' Perspective
The National Association
of Homebuilders (NAl-IB) claims that tariffs on Canadian softwood lumber
increase the cost of building a home. However, they fail to mention: 1) lumber
prices are now at near record lows because of abundant supply; 2) lumber
represents less than 3% of the price of an average home.18 Further, using wood
efficiency practices recommended by NAHB's own research center -- such as
tresses and panels, stressed-skin panels, and optimum value engineering -- can
reduce building costs by as much as $4,800 per home, sometimes easily making up
the cost of fairly priced wood products from Canada? And, again, it must be
remembered that our coalition does not seek to end Canadian timber exports to
the United States.20 We seek only a more rational economic and ecological
framework under which Canadian logging takes place.
VI.
Constructive Solutions to the Softwood Lumber Debate
We
support a negotiated settlement to the softwood lumber trade dispute as the most
efficient avenue for broad provincial forest management reforms and we hope that
our comments can be of assistance in reaching a durable agreement. Any
negotiating framework settled on by our two countries needs to be comprehensive.
We have pointed out many times in the past months that the fundamental elements
of a softwood lumber trade agreement are interdependent. No one will benefit if
reforms are only partially implemented. We believe that a durable solution is
only possible under a strong framework that ties the core elements together as a
single package. These core elements include tenure reallocation, full market
pricing, improved environmental measures, and recognition of aboriginal
title.
Environmental organizations advocate a solution
to the softwood lumber dispute that addresses the economic, environmental and
social problems related to forestry in Canada. The following reforms would not
only solve the softwood lumber dispute, but also lead to a more innovative,
ecologically sound and publicly beneficial forest sector by: diversifying
control over forest lands, creating opportunities for new market entrants,
ensuring full value for the forest resource, and ensuring greater public
participation and environmental protection in our forests.
A. Diversify control over forest lands in Canada
In many areas of Canada, a relatively small group of integrated forest
products companies control the vast majority of the land base through long-term
licenses or "tenures." This has implications for Canada as well as the United
States. Because.the economies of many communities are dependent on them, these
companies are able to pressure governments to ease environmental protections and
reduce the amount they pay for trees. The tenure system has undermined the
capacity of forest-based communities to achieve ecological sustainability,
economic diversity and control over land-use decisions that will affect their
lives, while presenting an obstacle to the honorable resolution of aboriginal
land issues.
Recommendation: A significant portion of
public forest tenures must be taken back to break up timber monopolies and to
facilitate increased conservation, resolving First Nations land issues and
providing tenure to a diversity of new entrants, such as small business loggers,
woodlots and community forests.
B.
B.
Ensure full market value for timber
resource
Although the vast majority of provincial
forested land is publicly owned, Canadians do not receive the full economic rent
under current stumpage policies. Provincial stumpage systems are often
arbitrary, subject to manipulation by licensees and governments, and
inadequately monitored or enforced. These shortcomings result in subsidies to
licensees estimated in the billions of dollars. These subsidies encourage
unsustainable over-cutting and result in negative impacts on transboundary and
endangered wildlife. While increasing the number of timber sales for small
business loggers can play a role in establishing a fair market value for public
timber, it is very important to create actual markets in logs for processing.
Even if a range of loggers can participate in the market for harvesting fights,
if these loggers can only sell their logs to a few large processors, Canadian
wood product markets will remain artificially restricted to low-end goods.
Recommendation: Provinces must institute regional log
markets to generate accurate timber values, ensure ease of access to wood for
all wood processors (particularly in the value-added sector), and provide
confidence that the full value of logs is being collected.
Recommendation: Sufficient volume must be required to flow through log
markets to ensure truly competitive bidding (e.g., 75% of timber harvested).
Recommendation: Stumpage fees must be calculated in a
transparent manner, using accurate timber values from log markets and timber
sales so that the full value of the wood is collected.
Part of ensuring full market value for timber resources requires an
adequate field of players inside Canada to generate market signals. To this end,
a softwood lumber trade agreement should leave existing raw log export bans in
place. There are a variety of provincial and federal laws and policies that
restrict the export of raw logs. The raw log export restrictions were intended
to encourage value-added industries by discouraging large-scale export of the
raw resource. Given the underdeveloped nature of Canada's value added industry,
these restrictions must be maintained or strengthened to close present loopholes
that undermine their effectiveness. Recommendation: The raw log export ban must
be maintained and the loopholes closed. C. Implement improved environmental
measures
Any negotiated settlement on the softwood
issue must address the subsidy currently in place through Canada's weak forest
management laws, including a lack of adequate protection for wildlife habitat
and poor enforcement of rules that require protective buffers along the shores
of Canadian waterways. While some provinces require habitat protection in their
endangered species legislation, not all provinces have such legislation. The
proposed federal Species At Risk Act fails to include this protection, despite
Canada's obligations under international law and previous commitments to do so.
Transboundary endangered species, including migratory birds, are afforded
extensive protections under U.S. law, but are not adequately protected under
Canadian law when they cross the border. Provincial rules also allow forestry
companies to log in ecologically sensitive areas along the banks of fish-bearing
streams. In B.C., for example, the Forest Practices Code offers no legally
required protections for small fish- bearing streams and direct tributaries to
fish-bearing streams, which are supposed to be protected under the federal
Fisheries Act.
Recommendation: Any negotiated
settlement must guarantee that no roll- back of federal or provincial
environmental standards will take place.
Recommendation: The federal government must enforce the Fisheries Act
to ensure adequate riparian protections, or at least ensure that provincial
rules meet the standards of this Act.
Recommendation:
The federal government must amend its proposed Species At Risk Act to ensure the
habitat of all species at risk is protected.
D.
Recognize Aboriginal Title
Forestry reforms can be
lasting solutions only if they are based on a legally and morally defensible
foundation -- recognition of Aboriginal Rights and Title. Failure to recognize
this constitutionally enshrined right represents a further subsidy to the forest
industry. Specifically, where government action infringes a nation's Aboriginal
Title, there is a duty to consult in good faith, and in some cases consent is
legally required. In addition, fair compensation will ordinarily be required
when Aboriginal Title is infringed. Delgamuuk v. British Columbia, 3 S.C.R. 1010
(1997). Because of the constitutional requirements to address Aboriginal Rights
and Title, any agreement that does not address these issues cannot be a
long-term solution.
Recommendation: Aboriginal Title
must be justly addressed as the underlying foundation for tenure and pricing
reforms. These reforms must recognize the constitutionally mandated priority of
aboriginal fights to forest resources after conservation concerns have been
addressed, and revenue-sharing agreements that recognize the economic component
of Aboriginal Title. E. Next Steps
The United States
and Canada are on the right path in discussing reforms of the pricing, tenure,
and forest management. Only through such reforms can we achieve a durable
solution to this dispute. However, once a framework for negotiation is settled
upon, the hard work begins of ensuring that the framework will work in practice.
For instance, on-the-ground forestry reforms must be monitored and verified.
Such an implementation mechanism will need to include clear indicators of
success to enable those monitoring implementation to evaluate the reform
process. Furthermore, many of the reforms will take months and maybe years to
complete. Cognizable interim reform steps, combined with reductions in the
applicable duty or fee, should be actively considered. Of course, it is not
acceptable to remove subsidies in one area, while granting new subsidies in
another. Consequently, any implementation mechanism will need to establish
safeguards against such backdoor subsidies, such as the weakening of
environmental protections. Ultimately, we believe serious consideration must be
given to a bi-national commission to monitor reform, identify and analyze
problem issues, and generally oversee implementation of a new softwood
agreement. This bi-national commission, or any other implementation mechanism,
should function in an open and transparent fashion, including citizen
representatives from both sides of the border.
VII.
Broader Trade Principles At Stake
As might be expected,
the softwood lumber issue is beginning to rear its head in multiple ways at
international trade fora. The best way to curtail the continued proliferation of
these types of actions is, of course, an appropriate negotiated settlement.
Last summer, for instance, Canada initiated case at the
World Trade Organization (WTO) challenging the U.S. Department of Commerce
preliminary countervailing duty determinations concerning softwood lumber from
Canada. Canada alleges that the US Department of Commerce's preliminary
determinations are inconsistent with WTO rules. Canada's position is that
government-granted extractive rights to natural resources, in this case granted
to Canadian timber companies for logging, cannot constitute a subsidy under
international trade rules. The U.S. Government responded that the countervailing
duty determinations were preliminary and subject to change, and that Canada's
request for a panel was premature. The opening Canadian brief could be due as
early as March 2002, coincidentally the month that the final determination by
Commerce is due.
In December 2001, further, Canfor
Corporation of British Columbia filed a case against the United States for $250
million (US) in damages under Chapter 11 of NAFTA, which
allows foreign corporations to sue national governments for democratic actions
that merely reduce anticipated profits. Canfor alleges that the Commerce
preliminary countervailing duty and antidumping determinations were made in an
"arbitrary, discriminatory and capricious manner." And just earlier this month,
the North American Commission on Environmental Cooperation (CEC) announced that
is formally seeking information for the preparation of a "factual record" as to
whether Canada has failed to enforce the federal Fisheries Act in connection
with logging practices. The petition was filed by a binational coalition of
environmental groups. At least one other complaint at the CEC concerning the
federal government of Canada's failure to enforce the Fisheries Act is also
pending.
The common denominator for all these actions
is Canada's resistance to change "business as usual" in its lumber sector. Were
it not for U.S. trade and environmental law, we would not possess the
opportunity for change that now exists. But our window is short and narrow. We
are hopeful that this Committee and the Administration can come up with a
negotiating agenda that balances the binational diplomatic relationship, the
lumber trade, and the extraordinary natural values in an effective way. The
upcoming Senate vote on the President's request for "trade negotiating
authority" (or '"fast-track") is a unique opportunity to revisit the U.S. trade
agenda, with the tangible lessons of this softwood lumber debate firmly in
mind.
VIII. Conclusion
Thank
you for the opportunity to provide testimony on this important international
topic. If done correctly, a new U.S.-Canada softwood lumber agreement could set
productive and historic precedents. We look forward to working toward this
shared goal of a strong and effective negotiated settlement. If we cannot make
the trade and environment linkages with a U.S.-Canada Softwood Lumber Agreement,
we are hard- pressed to see where such linkages can be made. This is a very
important test for the Bush Administration and its nascent trade policy.
FOOTNOTES:
1 It is imperative to
contextualize the "grassroots groups" supposedly opposed to curbs on Canadian
timber exports to the United States. First, some of these groups, such as the
American Consumers for Affordable Housing, are funded by the Canadian timber
industry. Second, wood is less than 3% of the total cost of a new house, and
even this cost can be significantly lessened (to levels approaching zero) by
wood efficiency methods touted by the National Association of Homebuilders
(NAHB) itself.
2 For these reasons, Defenders and our
allies have been preparing a "Citizens' Trade Alternative" to aid negotiations
of a new softwood lumber agreement. This draft document serves to help the U.S.
negotiators by providing a legal framework under the National Environmental
Policy Act, the Endangered Species Act, and relevant international law.
3 The 1996 U.S.-Canada SWLA at Article VII explicitly
recognized "forest management systems" highly relevant to subsidy'
determinations, and in 1998, the B.C. Government justified its unilateral
reduction in stumpage fees as necessary to offset forest management costs.
4 See generally Tom Green and Lisa Matthaus, Cutting
Subsidies or Subsidized Cutting?
(July 12, 2001) at
12-15. Although this report commissioned by the B.C. Coalition for Sustainable
Forestry Solutions focuses on British Columbia, where many independent analysts
have reached similar conclusions, the problems discussed are rampant throughout
other provinces such as Alberta, Quebec, and Ontario. Further information on the
other provinces can be supplied, upon request.
5 See,
e.g., Testimony of G. Bruce Willis, The United Brotherhood of Carpenters and
Joiners of America, Senate Field Hearing on Canadian Lumber Imports (July
1,2001).
6 The provincial government of Quebec should
be noted for its proposal to link the economic trade issues with the
environmental trade issues.
7 Environment Canada. The
State of Canada's Forests 2001: Profiles Across a Nation.
(http://www.nrcan-rncan.gc.ca/cfs-scf/national/what-
quoi/sof/sof01/profiles_e.html#CND)
8 The New America
Foundation, Stopping the Giveaway of Canada's Forests: Establishing True Free
Trade in Softwood Lumber (October 2000) at 11.
9 Green
and Matthans at 5.
10 Id.. at 8.
11 Mitch Anderson and John Werring, Stumpage Sellout: How forest
company abuse of the stumpage system is costing B.C. taxpayers millions
(Vancouver: Sierra Legal Defense Fund, 2001).
12 Green
and Matthans at 21-22.
13 Global Forest Watch Canada,
Canada's Forests at a Crossroads (World Resources Institute, 2000) at 71.
14 See Attachment 1 from October 2001 Vancouver Sun, which
calls forest management system "cost-burdensome." More recently, the ruling
provincial government of B.C. announced major budget cuts that will severely
hamper natural resource management and enforcement. Environmental groups from
both countries have informed USTR and the rest of the U.S. administration of
these recent developments. Numerous independent studies have documented the
costs savings associated with shirking basic environmental responsibilities.
See, e.g., PricewaterhouseCoopers, The B.C. Forest Industry: Unrealized
Potential (January 2000) at 3-4; British Columbia Ministry of Forests, Financial
State of the Forest Industry and Delivered Cost Drivers (April 1997), available
at www.for.gov.bc.ca/het/costs/fin-10.htm. In addition, enforcement audits by
the Northwest Ecosystem Alliance indicate that over 50% of examined forest
planning units in Canada possessed significant environmental enforcement
problems. See also David R. Boyd, Canada vs. The OECD: An Environmental
Comparison (University of Victoria, 2001)(detailing Canada's woeful
environmental enforcement record generally).
15 Global
Forest Watch Canada, Canada's Forests at a Crossroads (World Resources
Institute, 2000) at 55.
16 Id.
17 U.S. Fish and Wildlife Service. Summary of the Conservation Status
of Selected Forest-Related Species with US/Canada Ranges (January, 2001).
18 The New America Foundation at 37.
19 See www.nrdc.org for NRDC publication Efficient Wood Use in
Residential
Construction: A Practical Guide to Saving
Wood, Money and Forests (1998) (Attachment 2).
20
Indeed, under the 1996 SWLA, which allowed all Canadian softwood lumber up to
14.7 billion board feet per year into the U.S. duty-free, canadian exports
regularly exceeded the amount of lumber that triggered the highest sliding scale
duty (i.e., $100/thousand board feet), indicating a viable market exists for
such higher-priced wood.
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