From Forest2Market's Economic Outlook 

 

In 2007, the U.S. Court of Appeals issued a decision to vacate the 2004 National Emission Standard for Hazardous Air Pollutants (NESHAP), more commonly known as the Industrial Boiler Maximum Achievable Control Technology (IB MACT or MACT) Rule. Part of the ruling required that the EPA craft a new rule to be approved no later than Dec. 16, 2010. To meet that deadline, the EPA issued the draft version of the new MACT rule on April 29, 2010. The comment period about the proposed rules has now been extended to Aug. 3, 2010.

The proposed rule creates work-practice standards of annual tune-ups for natural-gas and refinery-gas-fired units and biennial tune-ups for boilers that have a heat-input capacity of less than 10MMBtuh. However, boilers that have a capacity of equal to or greater than 10MMBtuh are subject to emission limits on particulate matter, mercury, hydrogen chloride, carbon monoxide and dioxin/furan. Also, the rules affect boilers previously referred to as multi-fuel by reclassifying them as incinerators.

 

Following impressive gains in lumber and plywood prices, Douglas fir log prices delivered to mills in western Oregon and Washington increased from $432/MBF to $528/MBF, up more than 20 percent since the beginning of the year. For May, Southwest Oregon led log price levels, with increases of 10 percent on Douglas fir during the month.

For the first time in several years, the premium for export logs nearly disappeared over the past month. From January to May 2010, the average log length for 2S Douglas fir delivered for domestic use in the Lower Columbia region increased from 33.5 feet to nearly 35 feet. This additional 1.5 foot of average length indicates that sawmills have been challenging exporters for higher quality logs. However, this trend is quickly reversing. Even as dimension and stud lumber prices decline, export demand remains strong for most Doug fir and hem-fir log grades. Over the summer, the export premium spread will widen, making life tougher for mills struggling to stay in the black.

 

 

In May, the US Department of Agriculture approved requests by Arborgen, a company created by MeadWestvaco, International Paper, and Rubicon, a New Zealand company, to plant 260,000 genetically engineered, sub-tropical Eucalyptus trees throughout the South.

According to the Environmental Assessment conducted by the USDA's Animal and Plant Health Inspection Service (APHIS), the trees planted will be genetically modified in the following ways:

 

 

Despite a barrage of bad news in June, biomass energy markets are showing signs of maturing. As more facilities gain support and acquire permits and funding, timberland owners will be faced with new decisions. First, they will need to decide whether to manage their lands for both timber and biomass production. Certainly, timberland owners can realize additional revenue if biomass demand exists locally. Many landowners, concerned about the ramifications of removing this material, will choose to leave logging slash in the forest as they have always done to improve soil conditions and provide animal habitats.

Biomass can be harvested in such a way that allows timberland owners to improve profitability and preserve their forests. Many states--especially those with mature biomass energy markets--have adopted or begun developing biomass harvesting guidelines. From Washington state to Alabama and Maine to California, states with significant forest resources have begun taking a serious look at what best practices should be in place to ensure sustainability.