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Green Stamps: NLBMDA asks for new eco-grade

BY Brae Canlen

At first glance, the request by the National Lumber and Building Material Dealers Association (NLBMDA) for a new lumber grade stamp seems pretty straightforward. wood products from well-managed forests would get a special marking to prove their ecological lineage. The American Lumber Standard Committee (ALSC), an independent body that oversees the standardization of softwood lumber, would simply add another stamp, similar to those that specify size, dryness or other characteristics.

Each piece of wood would carry its “eco-stamp” throughout its lifetime, from the mill to the lumber yard to the job site. This would eliminate the need for lumber dealers to keep separate purchase, sales and inventory records. Nor would they have to create a separate storage area for the certified lumber, or calculate what percent age of their inventory is certified, or worry about a lawsuit if somebody mixed up the piles on a job site.

The NLBMDA, which represents 8,000 building material distributors and suppliers across the United States, has been working on this proposal for several months, through are search and education foundation called the LBM Institute. In January, a formal request was sent to the American Lumber Standard Committee, asking the ALSC to explore the idea of adopting a New eco-certification standard and label. From the NLBMDA’s point of view, the eco-stamp will eliminate the onerous chain-of-custody requirements that now govern the use of wood in green building projects.

Not surprisingly, the agencies that oversee green lumber authentication don’t see it the same way. Adding more green standards and certifications to the mix might add to the growing confusion over green building products, they say. And getting a new eco-friendly label approved and accepted might not be all that simple after all.

The NLBMDA proposal comes at an opportune time in the green building movement, which is poised to take a major step forward into residential construction. The U.S. Green Building Council released its LEED (Leadership in Energy and Environmental Design) rating program for homes last November. The National Association of Home Builders (NAHB) will launch its National Green Building Program—which it describes as a “low cost administrative and certification system that will help keep green affordable”—on Feb. 14 at the International Builders’ Show.

It remains to be seen which program, LEED for Homes or the NAHB’s, becomes the preferred designation among architects, home builders and consumers. But either way, lumber suppliers will have to navigate their way through different chain of custody rules if they want to supply lumber for these projects.

“If we really want to build green, we should be finding every way we can to include green building products in a structure,” said Mike Fritz, president of Rug Lumber and a former NLBMDA chairman. Fritz, who now represents the group on the A LSC, finds the LEED program particularly restrictive because it only accepts lumber certified by the Forest Stewardship Council (FSC). And FSC requires that lumber yards become certified, a process that costs approximately $3,000 upfront, in order to sell FSC-certified wood.

“Once lumber has been certified as being harvested in an eco-friendly way, it doesn’t change once it arrives in my yard,” said Fritz, who owns three lumberyards in Massachusetts. “Where does that [FSC certification] add value?”

Valerie Hansen, president of Big Buck Builders Supply in Racine, Wis., is a member of the NLBMDA’s Green Building Council as well as its LBM Institute. Her concerns are focused on the chain of custody agreements that lumber dealers must sign to carry certified wood.

“These requirements incorrectly place warranty obligations and all the documentation to the job site on us,” Hansen said. “ It’s a monstrous amount of paper-work, and if we don’t get it right, we can later be held responsible.” Even lumberyards that carefully track their shipments can get caught in between a builder and an inspector, Hansen pointed out. And what happens when a framer on a green residential project comes up short on a few studs, she asks?

Bob Perritt has already thought of that. The owner of R.J. Perritt Homes is able to secure green building designations for his Northern Ohio spec homes by combining energy-efficient products and building methods; he doesn’t need to use certified lumber. Sourcing the product proved too difficult, he said, and proper documentation was often lacking. Plus, he doesn’t think he can keep certified lumber separate on the job site. “Things happen, and people don’t always think [clearly],” Perritt explained. “Material gets commandeered for something else.”

When asked if a new grade stamp would make it easier to use certified lumber in his projects, Perritt replied: “That’s a no brainer.”

Working out the details of a new eco-stamp would be left to the ALCS, which is taking a cautious stance so far. Tom Searles, the ALSC’s president, said the proposal will be discussed at the organization’s next executive committee meeting. The last time the ALSC developed a new grade stamp was approximately six years ago, when lumber mills started marking boards as “HT” for “heat treated.”

“The mechanics would not be a problem.” Searles said, explaining how new grades are either rubber stamp edor imprinted on boards with an ink jet at the mills. As with all grade stamps, the costs are paid by the mills based on volume—for example, 2.4 cents per thousand board feet.

Searles’s main concern, he said, is whet her a new ALSC grade stamp would gain acceptance among end users, justifying its setup costs. Many of the details still have to be addressed, including what forest management standard the ALSC would adopt and which accrediting agencies would be involved.

The NLBMDA proposal might never have come about if today’s certified lumber bore some kind of brand. But neither of the two major organizations that certify eco-friendly lumber requires a distinguishing mark.

The FSC program is very protective of its trademark, and using it requires a lengthy process. As a result, only 10 percent of FSC-approved products worldwide carry its label.

“Companies only do what they’re required to do,” said Wolfram Pinker, managing director of the Smart Wood Program for the Rain forest Alliance, the country’s largest certifier of FSC wood. Pinker is aware of the benefits of branding, however, and Smart Wood is developing a program to encourage lumber producers and distributors to use the FSC label on products and in marketing materials.

With the Sustainable Forestry Initiative (SFI) program, an alternative to the FSC certification, there’s no charge or other impediments to the use of its logo. But only three or four mills stamp “SFI” on their certified wood products, according to Jason Metnick, director of market access and product labeling for SFI. As with FSC, the proof is in the paperwork that accompanies the delivery. Which explains why SFI, like FSC, also requires dealers to keep track of the lumber—maintain the paperwork on its chain of custody—after it comes into the lumberyard.

“The notion of putting a stamp on a 2×4 at a sawmill and saying it’s good to go is naïve,” said Robert Hrubes, senior vp at Scientific Certification Systems, a company widely recognized for conducting FSC audits. Hrubes believes that counterfeit stamps and other unscrupulous practices could invade the supply chain, especially given the fact that certified wood can be indistinguishable from regular dimensional lumber. “You need to track the wood,” he said. And that requires maintaining a documented chain-of-custody.

Hrubes has another idea, however, a variation to the NLBMDA plan: develop corresponding marks to match the various certifications and embed them in the lumber grades. So a No. 2 FSC-certified board would carry both the FSC and the No. 2 marks. “It wouldn’t eliminate the need for chain of custody, but it would be more cost effective down the stream,” Hrubes said. “It could make life a lot simpler.”

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Weyerhaeuser reports loss in fourth quarter

BY HBSDEALER Staff

Federal Way, Wash.-based Weyerhaeuser reported a net fourth-quarter loss of $63 million, swinging from earnings of $507 million in the same period last year. Sales were $3.9 billion, down 23.1 percent from $4.8 billion last year.

For the year, the forest products company had net earnings of $790 million, up 74.4 percent from $453 million in 2006. Sales dropped, however, to $16.3 billion from $18.7 billion last year, a decline of 12.8 percent.

Steven Rogel, chairman and CEO of Weyerhaeuser, characterized 2007 as a “challenging year” and said the company has been implementing ongoing improvements to its packaging business, while implementing “growth strategies” in its timberlands business.

“The continuing erosion of the U.S. housing market created very unfavorable market conditions for our timberlands, wood products and real estate businesses,” Rogel said. “Despite difficult market conditions, which we expect to continue through 2008, Weyerhaeuser remains focused on managing through the downturn.”

The company’s real estate business took the largest hit, with earnings falling 52 percent. Orders were down 19 percent, and the company’s backlog of homes sold, but not closed, dropped 35 percent.

Weyerhaeuser is one of North America’s largest diversified wood products companies.

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NAR weighs in on Freddie Mac, Fannie Mae reform

BY HBSDEALER Staff

The National Association of Realtors has submitted a position to the U.S. Senate Committee on Banking, Housing and Urban Development, supporting increased loan limits in government-sponsored enterprises (GSEs) Freddie Mac and Fannie Mae.

Reform to the two main government-sponsored lending organizations has been a topic of debate in light of the damaged subprime mortgage market.

Proponents of raising loan limits say it is a needed stimulus for the housing market. Opponents say giving the lending organizations a route to the “jumbo” loan market could be dangerous without additional safeguards.

Currently, a cap of $417,000 exists on loans issued by the GSEs. The NAR and other proponents of the stimulus plan support raising the GSE lending limit to $625,000.

The NAR submitted testimony to the HUD committee saying, “Fannie and Freddie are our partners in the housing industry and are important to stabilizing and strengthening the housing market.”

The group said the package could help “as many as” 500,000 jumbo loan borrowers to refinance. Additionally, the NAR says a higher rate limit could allow a large number of borrowers to enter the home buying market.

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