Strengthening the Hardwood Industry: Log Exports and Product Misinformation

The U.S. hardwood industry is at a pivotal crossroads, grappling with two critical issues: shifting log and lumber export trends and misinformation impacting market perception.

To address these interconnected challenges, the NHLA has established two essential task forces: the Log and Lumber Export Task Force and the Wood Truth Task Force. Together, these groups are working to analyze economic disparities, address false marketing claims, and develop actionable strategies to support the industry’s sustainability and growth. Their findings complement one another, providing a unified approach to strengthening domestic competitiveness and restoring consumer trust in hardwood products.

THE LOG AND LUMBER EXPORT TASK FORCE
The Log and Lumber Export Task Force was formed to analyze the factors driving the growing preference for log exports over processed lumber. Its goal is not to stop log exports but to understand why logs are exported instead of being processed domestically and to provide actionable insights that improve the competitiveness of U.S. mills. The task force’s methodology focuses on three core areas:

1. Log Processing and Grade Models
2. Start-up and Operating Costs
3. Government Policy, Including Subsidies, Taxation, and Regulation

PROGRESS ON LOG PROCESSING AND GRADE MODELS
The task force is conducting a Log Yield Study to compare output market values under the traditional NHLA grading system versus Chinese grading standards. As part of this effort, multiple loads of logs that would have been destined for China are being processed domestically to assess differences in yield and value. Supported
by grant funding from the U.S. Forest Service, the task force has already sawn two loads of logs at one facility and plans to replicate the study at additional sawmills to confirm the results.

“The topic of log exports arose at the 2024 NHLA Spring Board Meeting, and I volunteered to lead a task force to better understand the drivers behind these trends,” explains Tom Coble, Task Force Chair. “Our goal is to analyze the competitive balance between log and lumber exports, provide actionable data, and explore ways the industry can strengthen its position. Importantly, this isn’t about stopping log exports but equipping the hardwood sector with insights to navigate this shift effectively.”

UNDERSTANDING THE EXPORT SHIFT
The preference for logs, particularly for species like Walnut, Ash, and Oak, underscores the need for U.S. producers to adapt to offshore buyers’ preferences. Chinese mills, for example, prioritize flexible cutting practices to improve customer-specific yield outcomes. They accommodate specialty thicknesses and grade variations, which some domestic mills struggle to match due to NHLA’s standardized rules for millwork, cabinetry, and flooring segments.

While U.S. producers often question the profitability of the Chinese sawmill model, the Log and Lumber Export Task Force aims to answer fundamental questions: How does the Chinese sawmill model work, and are there learnings to make U.S. producers more competitive?

START-UP AND OPERATING COSTS
Chinese mills prioritize customer-specific yields by operating under a flexible, cost-efficient model. In contrast, U.S. mills face significant financial challenges:

• Equipment Costs: U.S. mills require high-quality, optimized equipment costing 2-20x more than low-cost, manual systems in China.
• Labor Costs: U.S. wages, ranging from $12-$24/hour, are 4-8x higher than China’s labor costs.
• Compliance: Strict U.S. regulations add 2-3x higher compliance costs, impacting operations further.

GOVERNMENT POLICY AND REGULATION
The task force is actively exploring how policies such as subsidies, tariffs, and taxation impact export dynamics. For example, foreign subsidies and Value Added Tax (VAT) advantages give Chinese mills a pricing edge, while U.S. mills struggle with limited government support and higher regulatory burdens.

THE WOOD TRUTH TASK FORCE
The Wood Truth Task Force was formed to address misinformation and marketing challenges that have eroded the hardwood industry’s market share. Its mission is to identify the root causes of these issues, combat competing narratives, and highlight hardwood’s superior sustainability, durability, and value. The task force’s methodology focuses on three core areas:

1. Countering Competing Narratives
2. Start-up and Legal Advocacy Costs
3. Industry Collaboration and Promotion

PROGRESS ON COUNTERING COMPETING NARRATIVES
The Wood Truth Task Force has prioritized combating misleading claims promoted by competing materials like vinyl flooring, Thermally Fused Laminate (TFL), and Luxury Vinyl Tile (LVT). These products have gained significant market share by emphasizing durability, cost savings, and low maintenance—claims often backed by well-funded marketing campaigns.

“Our industry has been facing significant challenges unlike any-thing we have seen in our time. We are witnessing unprecedented market erosion, and it has become clear that substitute products are the primary culprit,” explains Chris Rider, Chair of the Wood Truth Task Force. “We need to work together to collectively market hardwood’s sustainability and authenticity to prevent further erosion of our industry.”

The task force is committed to correcting these misconceptions by educating consumers on hardwood’s true environmental and economic benefits.

START-UP AND LEGAL ADVOCACY COSTS
Legal advocacy has played a critical role in holding competitors accountable for false advertising. For example:

• Mohawk Industries: The Decorative Hardwood Association successfully challenged Mohawk’s misleading claims in their “Wood Without Compromise” campaign.
• Wilsonart’s “Wood Grains” Claims: The WTTF is evaluating legal action to address similar concerns, though costs for such lawsuits often exceed $75,000.

These legal efforts are costly but essential for setting precedents that protect the integrity of hardwood products.

INDUSTRY COLLABORATION AND PROMOTION
The WTTF recognizes the importance of unifying the industry to promote hardwood’s competitive advantages and sustainability:

• National Advertising Division (NAD): Developing a centralized effort to detect false ads, enforce policy standards, and amplify truthful messaging through AI monitoring and outreach campaigns.
• Collaborative Marketing: Building on the success of initiatives like the Real American Hardwood® Coalition (RAHC) to foster cohesive messaging and strategic campaigns.

GOVERNMENT POLICY AND TAX INCENTIVES
The task force is advocating for federal incentives to promote hard-wood products, inspired by the 30% federal tax credit for geothermal HVAC systems under the Inflation Reduction Act. Applying similar incentives to hardwood products could:

• Encourage adoption by showcasing hardwood’s carbon-negative properties.
• Promote strategic partnerships with architects and builders for sustainable construction projects.
• Drive consumer education campaigns that highlight hardwood’s environmental and long-term value.

“Our industry has been facing significant challenges unlike anything we have seen in our time. We are witnessing unprecedented market erosion, and it has become clear that substitute products are the primary culprit.”

WHY THESE TASK FORCES COMPLEMENT ONE ANOTHER
The Log and Lumber Export Task Force and the Wood Truth Task Force address two sides of the same challenge:

1. Economic Factors: The export task force identifies systemic disparities driving log exports and opportunities for improving domestic competitiveness.
2. Market Perception: The WTTF counters misinformation and positions hardwood as a superior material in terms of sustainability, durability, and value.

The hardwood industry thrives on data-driven solutions aimed at improving competitiveness and optimizing yield outcomes. Through focused advocacy and education efforts, we work to restore trust, counter false claims, and highlight the numerous benefits of hardwood. By fostering unified action, we aim to align economic and marketing strategies, ultimately strengthening the industry’s overall position.

CONCLUSION
The U.S. hardwood industry stands at a decisive moment. The  Log and Lumber Export Task Force and the Wood Truth Task Force play complementary roles in tackling economic challenges and combating misinformation. Their data-driven insights and collaborative strategies are laying the foundation for a stronger, more competitive hardwood industry. By addressing export trends, promoting sustainability, and restoring market confidence, these task forces are helping secure hardwood’s position as the material of choice for generations to come.