He wrote the book on West Coast lumber
If you’ve been around the LBM industry long enough, chances are that you’ve run into Ken Dunham, executive director of the West Coast Lumber and Building Material Association.
Dunham is always good for a talk and a listen. In his most recent project, he did plenty of both along with some writing. Dunham has authored “The Legacy of Lumber: A History of the Lumber Industry in California & the West.”
The book was published in commemoration of the 100th anniversary of the association and tells the story of the lumber industry in America, from colonial times to the present, with a sharp focus on the rich industry history in California.
Dunham has been executive director of the association since 2006 (previously known as the Lumber Association of California and Nevada). His experiences have included owning a regional advertising agency and public relations firm, political consulting and management, and as a television new director and on-air personality in Montana, where he also supplied stories and film to ABC and NBC news.
“I’m from Troy, Mont., a little logging town way up north — nearly in Idaho and nearly in Canada. It’s kind of the last town before you hit Idaho and the last town before you hit Canada. It’s down to about 900 to 1,000 people today.”
But his true passion is for the LBM industry, which stems from growing up in such a place as Troy.
HBSDealer discussed the genesis of the book with Dunham, along with some of this views on the current state of the industry, what he learned while writing the book, and what he envisions down the road.
What inspired you to write the book?
We were sitting around a year-and-a-half ago and it was the 100th anniversary of the association. I always thought a book might be fun and everyone thought that was a fun idea – and soon after I was diagnosed with a highly curable form of throat cancer.
I’m now 100% cured and done with radiation and chemotherapy. It took me some time to get my stamina back and get back to a 50-hour week. My normal week is 60 hours.
But this has been fun for me because I’m a real history nut. I wrote part of a similar type of book about Montana business history about 25 years ago.
When I was a little kid growing up in Montana, within walking distance from our house there were three or four sawmills. And I worked on the green chain when I was about 13 years old. They paid you about 25 cents to 30 cents per hour to pull 2x4s.
And I can’t visit everyone we have in our association in a year’s time since we have 300-member locations. So this gave me a great chance to reconnect with people and learn a whole lot about our companies.
What surprised you about the history of west coast LBM?
Most of these people were not previously wealthy people. It’s not like the cattle barons of the West or the bankers – rich people coming west with old money – this is a business started by hardworking people who mortgaged their house. In some cases they started a lumber business and didn’t even have a yard. They would buy it off the ship and then haul it where the people were building. They would sell it off the truck and save enough to buy their property and build a lumberyard.
So many of these businesses here, and this is probably typical across the country, are getting to the third, fourth, and fifth generations of ownership. I think that says a lot. I think this book should be required reading for anyone in public office. You want to talk about an industry that has good, honest, hardworking people? Look at this industry.
That’s been my mantra since I got here: this is an industry of good people who care for the people that work for them. You find so many of these companies that have people that have worked for them 30 to 40 years and even for several generations. It’s also an industry that does an awful lot of business on just a handshake. Someone orders a load of lumber and then the paperwork follows.
Who are the unsung heroes of the industry?
I would have liked to have included a section in the book on some of the unique individuals – John Sutter, a sawmill owner who found gold here, people like Red Emmerson of Sierra Pacific Industries, Homer Hayward of Hayward Lumber. I hesitate to mention more names in fear of leaving someone out.
There are a lot of interesting people who were and still are part of the industry.
There are some unique characters in this industry – now that we have a basic framework for the industry, we can begin to focus on those who we didn’t hear from and focus on the people with unique stories.
For example, after World War II you couldn’t get equipment such as forklifts. But one company in the San Francisco Bay Area bought an old surplus bomb loader and converted that thing into a forklift because equipment wasn’t available. That’s really innovative.
Now I go to these sawmills and see the ability to not waste any part of a log. We have all of this marvelous technology that makes this industry safer, more efficient and environmentally sound. A lot of this has come from people in the yards who had great ideas – you hear about that all the time. This is an industry of really innovative people.
If you made a movie of the book, who would you want as the lead actors? Man and woman?
Gregory Peck or Charlton Heston. And there are some strong powerful women in this industry – Kathleen Patterson at Central Valley. There are a number of women who have owned and managed lumber companies – real Katharine Hepburn types – classy people.
What are the biggest changes you’ve witnessed in this industry?
The political challenges to this industry are significant at both a state and federal level. There is a significant amount of unfounded and simply untrue statement and assumptions made about the wood products industry – from the logging to the retail portions.
The way this industry was run even 50 years ago is not what is done today. This is a sustainable, well-managed industry at the production level, and the retail side of lumber is increasingly being looked to as providing great building products for uses not considered even a few years ago.” Wood will handle an earthquake a lot better than a steel or concrete structure.
Regulation at all levels is often unfounded and not well thought through – there are none of us who want to see us see people working in unsafe conditions but I think there is overkill on business in general. And that’s just the regulation side of it; there is also the legislation that is often misguided.
I had worried at one point: ‘Was there a future for the independent lumber retailer?’ The answer is ‘yes’. I don’t think the future is all corporate big box or continued consolidation. This industry sells a unique product.
I think this industry has been remiss in getting into the architectural and trade schools and selling lumber as a product for more than single family homes or apartments – there are more uses out here.
What are the biggest challenges that lie ahead for this industry and in your territory?
Certainly, the challenges this industry has faced from the big boxes is something that can’t be underestimated but I think most everyone is thriving out here – if you are doing a project you want expertise and you’re not getting that from someone whose last job was asking if you ‘wanted fries with that.’ If you are looking for expertise and advice, you want that informed independent person who has the wealth of knowledge and has their name behind their business – there is certainly a future here.
What is going to impact a lot of it is how do you deliver materials efficiently, on time, and accurately. Most companies are being very innovative about that. It’s the people you have working with and for you that make a significant difference.
One of the things I’m kicking around in my head now is the attracting new, young people to join the industry. This is good work, it’s honest work, you are going to get paid better than you will in a lot of other businesses and you will probably have the opportunity to advance.
I’m a believer in apprenticeship programs and on-the-job training. My father was a high school guidance counselor and one the very first in Montana in the 1950s. One of the things he told some students was that college wasn’t for everyone – everyone shouldn’t be a doctor or engineer
s. There were needs for mechanics, plumbers, and carpenters. And my dad had one of his master’s degree in industrial arts.
What would you be doing if you weren’t in the LBM business? Your dream job?
Actually, this is my dream job. I don’t say that because I work for this association. I would have to be hogtied in bed to not come into work. I like what I do. I liked what I’ve done in other times in my life from television news to politics – and I’ve made abrupt changes but I haven’t regretted any of it
What and where is your favorite Dive Bars?
My all-time favorite palace is still Hap’s Bar in Helena, Montana. It’s an old joint right next to the railroad tracks so it gets a mix of railroad workers, hobos, construction workers, cowboys and a bunch of business types who just like being around real people.
In Washington, D.C., there is a place called the Tune Inn. I first went there with a U.S. Senator friend in the early 1970’s because he thought it might be like places I’d been in Montana. I still stop in from time to time when in Washington.
I liked my neighborhood tavern, the Evergreen Tavern, when we lived in the Chicago suburbs some years back. Same great mix of people and I know that if I was out of town and there was a plumbing or electrical emergency at home, my wife Janelle could ask someone there for help.
I don’t want it sound like I’m in bars all the time, but taverns are great places for information. I knew that in my reporting days. A cold beer and a football game on the TV is a great way to spend some relaxing time. I like hanging out where there are real people.
Will there be a Volume 2?
I have not ruled that out. People are sending me interesting history about the industry. There is probably enough at some point to add to it and expand upon it.
McCoy’s promotes new location managers
McCoy’s Building Supply has made two managerial promotions.
Joseph Martinez has been named store manager of McCoy’s Odessa location while Aaron Sherbino has been appointed manager of the pro dealer’s Orange, Texas branch.
Martinez began his career with McCoy’s five years ago on the sales floor of his hometown McCoy’s in Brownsville, Texas. He served as assistant manager at the Midland location for more than two years during the height of the oil boom in the Permian Basin. The company said it was in Midland where he embraced the company’s vision for serving the “Born-To-Build” customer. He also spent time as Assistant Manager in Weslaco before managing the company’s Hobbs, New Mexico, store.
“Joseph made many great contributions to the Hobbs store during his tenure,” said McCoy’s Regional Manager Kevin McKeown. “I’m excited for him to return to the Odessa area and bring his enthusiasm to the store.”
“Our goal is to provide the best customer service around,” said Martinez. “I want our customers to feel like McCoy’s is a place where the staff is going to go above and beyond to make their project a success.”
Sherbino started his career with McCoy’s two years ago working as a cashier before joining the company’s management development program. He moved through the ranks quickly as assistant manager in Richwood, Pearland, before taking the reins of the Orange store.
“I’m really excited for this next step in my career. As an Assistant Manager, I asked a lot of questions and strived to learn as much as I could,” said Sherbino. “I’m ready to lead this team and get to know our customers in Orange. McCoy’s has a strong family atmosphere with friendly, hard-working employees dedicated to our customers.”
McCoy’s is one of the nation’s largest privately held building supply retailers in addition to selling farm and ranch supplies. Headquartered in San Marcos, Texas, McCoy’s motto is quality building products and services to its “Born-to-Build” customers since 1927. The company operates 87 stores and two millwork facilities in Texas, Oklahoma, Arkansas, Mississippi, and New Mexico.
NLBMDA provides softwood lumber dispute update
The National Lumber and Building Materials Dealers Association (NLBMDA) gave its update regarding the softwood lumber dispute between the United States and Canada.
Ben Gann, NLBMDA vp of legislative and political affairs, presented the following about situation:
The U.S. International Trade Commission (ITC) on December 7 upheld the antidumping duties (AD) and countervailing duties (CVD) placed on softwood lumber imported from Canada to the U.S. The decision by the ITC follows the Department of Commerce’s announcement last month finalizing AD and CVD on Canadian softwood lumber.
Most Canadian firms will pay a combined AD/CVD rate of 20.83 percent. For the five companies (Canfor, J.D. Irving, Resolute, Tolko, and West Fraser) directly involved in the investigation, they will pay a combined rate that is different. Canfor will pay 22.13 percent, J.D. Irving will pay 9.92 percent, Resolute will pay 17.9 percent, Tolko will pay 22.07 percent, and West Fraser will pay 23.76 percent. Duties will not apply to softwood lumber harvested in the Atlantic Provinces of Newfoundland and Labrador, Nova Scotia, and Prince Edwards Island.
The Canadian government has responded on two fronts in the ongoing softwood lumber dispute. First, it challenged the countervailing duties (CVD) under Chapter 19 of the North American Free Trade Agreement (NAFTA) on November 14. Second, Canada opened a World Trade Organization (WTO) case against the U.S. regarding the duties on November 28.
NAFTA Chapter 19 panels decide if an antidumping or countervailing duty determination is in accordance with the applicable national law, rather than with NAFTA obligations. Thus, Chapter 19 panels principally serve a judicial function, rather than a NAFTA dispute settlement function. As part of the NAFTA renegotiation, the U.S. has proposed eliminating Chapter 19 and relying on domestic courts to hear disputes, a position Canada strongly opposes.
Canada’s case against the U.S under the World Trade Organization (WTO) dispute settlement system is different from the NAFTA process. Here, the Canadian government complaint focuses on the method used by the Commerce Department to calculate duty rates. The Commerce Department used a method known as “zeroing” that disregards negative dumping margins in calculations and increases the duty rates. The WTO has historically found the practice of zeroing to be a violation of the General Agreement on Tariffs and Trade (GATT).
Unlike with the NAFTA Chapter 19 case, the WTO case is a purely government-to-government dispute regarding the application of international trade agreement obligations, rather than a dispute involving private parties regarding the application of U.S. law.
The litigation does not preclude the two countries coming together and reaching a new agreement. However, the last agreement reached in 2006 occurred four years after antidumping and countervailing duties were first imposed and litigation on those determinations had begun. In discussions with U.S. and Canadian trade officials, NLBMDA has stated that duties are a poor substitute for a long-term agreement that provides predictability and stability for softwood lumber supply and prices.
Lumber prices have increased over the past year in part because of the duties placed on Canadian softwood lumber imported to the U.S. The Random Lengths Framing Lumber Composite price is now $434 per thousand board feet, an increase of 21 percent over the past year, and the Random Lengths Structural Panel Composite price is now $427 per thousand board feet, an increase of 17 percent over the past year.
In 2016, imports of softwood lumber from Canada into the U.S. were valued at an estimated $5.66 billion. The Trump Administration has initiated 79 antidumping and countervailing duty investigations this year – a 65 percent increase from 48 in the previous year.
NLBMDA will continue to engage with the Department of Commerce, Canadian government officials, and Congress on the softwood lumber dispute in hopes of reaching a new agreement that does not put American lumber producers at a competitive disadvantage, unnecessarily restrict the availability of products, or increase the cost of housing to the detriment of prospective homebuyers and consumers.