This Land is My Land

Private forest owners welcome the opportunities presented by growing pellet markets, but feel their story of sustainability speaks for itself.
By Ron Kotrba | May 21, 2015

What environmental groups opposing the commercial wood industry must know is that invasive species such as the bark beetle are more destructive to U.S. forests than logging operations. In Colorado and Wyoming alone, an estimated 100,000 beetle-killed trees fall per day, according to the USDA’s Forest Service. The worst part? Bark beetles kill indiscriminately, offer no profit opportunity, provide zero value-added products to society, never replenish their lands and have no best-management practices to speak of whatsoever. They just destroy and move on. Their actions fly in the face of countless federal, state and local laws and regulations implemented to protect and conserve.

“We don’t actively manage federal forestlands,” says Scott P. Jones, CEO of the Forest Landowners Association, an advocacy group promoting the rights of private landowners regardless of size, corporate structure, location, and certification status or tax classification. FLA membership is comprised of private forestland owners who are families and investment land owners, the majority of whom are individual families that own and manage generational family ownerships. The average holding is fairly large, Jones says, around 1,000 acres. FLA members represent about 48 million acres of private forestland, mostly in the Southeast U.S. “Because we don’t actively manage federal forestlands, they are in poor health,” Jones says. “There’s wild fires, massive outbreaks of pests, pathogens, bugs, fungus—a whole host of issues on federal lands that we don’t see on private forestlands. Private landowners manage their land. Part of that is harvesting timber. We need healthy markets.”

The Forest Service reports that the U.S. has about 751 million acres of forestland, with 623 million acres in the lower 48 states. Forests encompass around one-third of the total land mass of the U.S. Forestlands outnumber croplands in the U.S. by one-and-a-half times. Nearly two-thirds of U.S. forests, or 514 million acres, are classified as timberlands. Timberlands are forested areas that are actively managed for the production of commercial wood products. An additional 75 million acres of forest are reserved for nontimber uses under the management of public agencies. The remaining 162 million acres do not qualify as timberland, but are important for watershed protection, wildlife habitat, grazing and recreation.

About 44 percent of U.S. forestlands are publicly owned, with 20 percent overseen by the National Forest System, 9 percent owned by states, 6 percent by the federal Bureau of Land Management, 2 percent by county and municipal governments, and the remaining 7 percent by other federal entities.

Fifty-six percent of U.S. forestland is privately held, most of which is noncorporate ownerships, according to the Forest Service. Corporate-owned forestlands comprise about 18 percent of the total, while noncorporate, private ownerships represent around 38 percent of all U.S. forestlands—the largest, single chunk of ownership in the U.S. More than 60 percent of private forest owners own between one and nine acres of forestland, but the Forest Service indicates that most of the private forestland acreage is in holdings of at least 200 acres. More than 20 percent of private forestland is in holdings of at least 10,000 acres, owned primarily by corporations.

Preliminary data from the Forest Service’s 2011 National Woodland Owner Survey shows that families own more than 282 million acres of U.S. forestland, a 12 percent increase from 2006. Those 282 million acres are held by more than 11 million ownerships, up 7 percent from 2006, with an average size of 25.2 acres.

A majority of U.S. timber comes from the South, where 147 million private forestland acres are held by 1.82 million family ownerships with nearly 5.3 million individual owners. The average holding size is 80.8 acres. The 2006 survey report shows that 87 percent of forests in the Southern U.S. are privately owned, and 68 percent of those are owned by families and individuals.

The Forest Service states that most of the nation’s forests are naturally regenerated, but planted forests are found primarily in the South. Nationally, 63 million acres, or 8 percent of forestland, is planted, but in the South, 20 percent is planted. Virtually all planted forestland is classified as timberland, and nearly all planted stands are established with native species, although not always the species that previously dominated in the area. Planted stands are supplying an increasing proportion of the U.S. timber supplies, and in the South, planted forests accounted for 43 percent of softwood removals in 2007. The annual rate of growth since 1996 has been about 3.5 times the increase in mortality during the same period, with growth rates in the South being among the highest. Historically, millions of intensively managed and highly productive forest industry timberland acres have been the primary reason for the higher average productivity on private timberland.

The U.S. population has more than doubled since the mid-20th century, from 152 million people in 1950 to 309 million in 2010, according to the U.S. Census Bureau. One might think this kind of population boom, with all of its urban sprawl and massive construction build-out demanding land and timber, would have devastating, depleting effects on our national forestlands. As counterintuitive as it may seem, however, tree growth in the U.S. has exceeded harvest since the 1950s, according to the Forest Service, and timber volume on timberlands has increased by about 50 percent since that time. Two-thirds of that increase was on private lands.

“Historically, markets have been a friend to private forests in our country,” says Dave Tenny, president and CEO of the National Alliance of Forest Owners. NAFO is an organization of private forest owners committed to advancing national policies that promote the economic and environmental benefits of privately owned forests. NAFO membership encompasses more than 80 million acres of private forestland in 47 states. “The post-World War II economic expansion in the U.S. that persists to this day represents the largest economic expansion in the history of mankind, and this expansion created unprecedented demand for forest products of all kinds. Using the logic of those who claim that new markets are bad for our forests would suggest that new markets would have depleted our forest resources long ago. But they didn’t. Instead, they helped increase by 50 percent the growing stock in our forests. That is a remarkable example of the strong, positive relationship between private forests and the marketplace.”

Priorities
Tenny says threats to the viability of working forests are reflected in NAFO’s policy priorities, which focus on preserving the well-established carbon benefits of private forests and biomass energy in federal policy, retaining the current tax treatment of timberland to preserve the economic viability and public benefits of private forest ownership, and preserving a reasonable interpretation of Waters of the U.S. (WOTUS) to maintain regulatory, economic and legal certainty.

“In 2010, EPA suddenly and unexpectedly reversed the longstanding and internationally recognized principle in federal policy that emissions from biomass energy do not increase carbon in the atmosphere,” he says. “This longstanding position was based on the fact that trees and other plants are part of an ongoing natural carbon cycle that maintains a carbon balance over time. EPA has since reconsidered this position but has yet to adopt a final position. This has created significant uncertainty and confusion in the marketplace and in federal policy.” He says forest owners seek to restore in federal policy the principle that energy from forest biomass is carbon neutral. “Preserving this principle is fundamental to the whole carbon paradigm of forestry,” Tenny says. “Forests and the products we derive from them are a sustainable, long-term part of the carbon solution—not part of the problem. New and unnecessary carbon regulations affecting land use that prevent the reduction or elimination of market opportunities for biomass energy and other forest products would be very harmful, not only to the practice of forestry and production of forest products, but also to our nation’s overall carbon reduction objectives.”

The current tax code treats private forest ownership as a long-term capital investment in real property and addresses in a practical way the economic realities of maintaining the health and productivity of these forests over time. Four private forestry provisions, commonly referred to as the “timberland tax” provisions, help maintain the economic viability of 450 million acres of private forests owned and managed by more than 22 million forest owners, including individuals, families, institutional investors and businesses. “An analysis shows that repealing these provisions could cause a 15 percent decline in domestic sales totaling as much as $34 billion annually and the loss of up to 140,000 jobs, while reducing federal tax revenue from the forestry sector through systemic changes in the industry,” Tenny tells Pellet Mill Magazine.

He says the EPA’s proposal to expand the definition of “waters of the U.S.” under the Clean Water Act threatens to impose costly, new administrative burdens and litigation risk for states and forest owners. “These burdens include confusion over whether water quality standards would apply to streams and small channels that are wet only part of the year, man-made ditches and entire floodplains,” he says. “They also include expanded permit requirements for the use of herbicides and increased exposure to citizen lawsuits.  Maintaining, and not expanding, EPA’s regulatory authority under the Clean Water Act would prevent significant financial and regulatory uncertainty for forest owners that could reduce economic returns, diminish land values, hasten the conversion of private forestland to other land uses and reduce the public benefits private forests provide.”

Jones says the concerns of FLA members are simple and fall into three principles. “We believe if we can secure private property rights, access to a free and open marketplace for wood, and fair taxation, then these people can manage their land for generations to come,” he says. “Right now, most attention is being paid to securing access to a free and open marketplace for wood.” Jones says by simply having a marketplace, this doesn’t ensure access. “If the market places constraints on who can participate by offering assurances of sustainability, then that’s not a free and open market. All of a sudden, the market is only offered to those who follow the program. What complicates it for us is oftentimes the assurance to sustainability comes in the form of third-party certification systems. We’re not opposed to them. They have right to choose. But when a marketplace dictates use of that certification system in order to offer levels of assurance to sustainability, and constrains the marketplace in doing so, it takes away our rights to manage our forestlands the way we see fit.” 

Misconceptions
Regulators in the U.S., EU and the U.K. “tend to be lazy,” Jones says. “They want to take a one-size-fits-all solution and apply that criteria for the whole world, and you can’t do that because the way we own and manage forestlands in the U.S. is different than anywhere else in world. Here they’re private lands. When you have private management—families—running a majority of the forestlands like in U.S., then the marketplace has to educate itself on the way we operate and work. The EU is unwilling to educate itself, so it’s the easy way out. Because of that, what they don’t see is that the pellet marketplace creates a sustainable solution in the U.S. marketplace. It creates a market into the future. If it’s not free and open, it puts in jeopardy the future of our forests. If there’s no money, there’s no incentives to continue managing our forestlands.”

And that’s where the danger lies. Jones and Tenny argue that when the markets for wood products and biomass energy decline or wither away, whether from recession or certification constraints applied by foreign markets, there is pressure on forestland owners to sell to developers or crop farmers—and that forestland, along with all the benefits it provided, is lost. 

Jones says he and his members understand stewardship certification and what that represents, but when markets from abroad try to apply it in the U.S., it won’t take. He says only a minute percentage of forestland acres in the South is certified by the Forest Stewardship Council. “There’s no supply under that system to go to Denmark,” he says. “That’s not the way it works. The way they need to do it is educate themselves on what truly sustains our forests, and what does that is private, individual, healthy markets for wood products. Should we be held to offer assurances of sustainability? Yes, but to what level, and who’s driving the conversation? The track record we have is second to none. We are growing more trees now than 50 years ago. If you plot that against population growth, population has exploded. Houses, Walmarts, electricity, all of that takes up land, yet we’ve increased the amount of forestland in this country. The reason? We’ve had incentive to do so, and that means more trees. Look at the pellet market, is that causing a sustainability problem or a solution? I know there’s a future for my wood, so I’ll keep growing it and reap the benefits.” 

While certification programs can provide significant value by helping to demonstrate sustainable management practices, Tenny says the greatest impact on healthy forests in the U.S. is the long-term management ethic of those who own and manage the land. “In the U.S., sustainable forest management constitutes a commitment of individuals, families and businesses that is as much cultural as it is anything else,” Tenny tells Pellet Mill Magazine. “It is a passion that is built into the fabric of forestry and forestry communities, buttressed by a strong and well-constructed framework of federal, state and local laws, regulations, best-management practices, technical assistance and certifications programs that support sustainable forestry.”

Certain opponents to logging, development and wood power suggest oversight of forestlands is slight, and light-handed. In some less-developed nations where fragile rainforests and virgin habitat are being depleted for grazing, palm plantations or soybean crops, third-party certification schemes could play a defining role in curbing such activity. “Forests in Malaysia, China and Brazil—is third-party certification right for them?” Jones asks. “Absolutely. There they deal with issues like child labor and clear-cutting, but in the U.S., we have a strong rule of law overseen by robust agencies, so adding more seems like hurdles that are not adding value.” 

Some agenda-driven activists say U.S. forestry operations are akin to the Wild West, with little enforcement of the law. More than 26 federal statutes govern how U.S. forests are managed, Jones explains. “The Wild West?” he asks. “Not at all. We manage for threatened and endangered species, the Clean Water Act, the Army Corps of Engineers, the Fish and Wildlife Service—all of these agencies are in place to oversee laws and regulations to protect the health of our forests. Private land owners work under these and best-management practices in forestry right now. And clean water—one of the most important things coming off our forest—is reported on every single year in every state, and we have 90 percent compliance. Individual states have forest management laws. The management of private forestland falls under a whole host of environmental regulations with robust agencies overseeing, complying and managing timberlands and forestlands in a healthy way with those laws and regulations. What’s a third-party certification going to change? Just recognition of what’s happening now should be enough of an assurance of sustainability.” 

Pulpwood used for bioenergy like pellets are the lowest value product to come from forestlands. “Pulpwood already has a home,” Jones says. “It goes into the paper industry. It’s a very healthy home and it’s not going away. So when you have the lowest value product that already has a home, and you start putting the largest amount of restrictions on it, the question arises of whether they’ll get that wood or not. That’s the reality they have to come to grips with. Land owners don’t have to sell wood to the pellet market. Do they want to? Yes. Is it important? Yes. They want to but don’t need to. The sawmill industry has been producing wood for homes and paper for 75 to 100 years. They’ve never been asked for assurances because they know what’s going on, they’re located here. Industrial pellet consumers, they’re not sure, and that’s where the rub comes.”

Those positioned against biomass energy propose that increased “reliance” on wood power jeopardizes forestlands. “Because it is low value, biomass is like the tip of the tail of the dog,” Tenny says. “It certainly doesn’t wag the dog and is the most unlikely of the forest products to drive the general practice of forestry in the U.S. In other words, entire forests will not be grown or cut down for fuel. Biomass will most often come from the trees thinned from the forest during a rotation cycle and from mill and harvest residuals produced during the harvest and manufacturing process. The message that biomass is driving forestry practices in the U.S. is a purposefully deceptive scare tactic used by some in an attempt to influence the perceptions of policy makers and the public. Strong existing and emerging markets are a friend to forests, not an enemy.” To be clear, no one is clear-cutting forests to make wood pellets. In “10 Biomass Myths,” Bill Cook with Michigan State University Extension writes, “If an owner and their forest could be so easily separated, it would have been done long ago. Simply because a new market emerges does not mean forest owners will be lining up to harvest their woodlands. In fact, recent research from Wisconsin and Pennsylvania suggest that providing wood for energy is not a significant motivator for future timber harvest.”

A misconception also exists that good stewardship, environmental ethics and, ultimately, sustainability have to be forced upon commercial forest operations. “Sustainability is not separate from our business model—it is the business model,” Tenny says. “If a working forest is not practicing sustainability, it won’t survive over the long term. Every benefit a forest provides has value. Some benefits are clearly monetized such as valuable timber or less valuable wood for biomass that is sold, but others have intrinsic value like air and water, and we protect them because we recognize they have great value to society and our overall quality of life.”

Author: Ron Kotrba
Senior Editor, Pellet Mill Magazine
218-745-8347
rkotrba@bbiinternational.com