HomeMy WebLinkAboutCOM 1155.001 2004-2006
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Tradewinds Forest Products Update
November 28, 2006
INTRODUCTION
I am Don Bryan, President and CEO of Tradewinds Forest Products, a
limited liability company owned by a small group of private investors. I am
a forester by training, and have spent the past 40 years of my life working in
the forest products industry.
In 1997, 1 heard about some really interesting things that were going on
with fast-growth trees on the island of Hawaii. I came to take a look and
was;ust blown away by what I saw. This sparked a fascination with the
eucalyptus plantations that are now reaching maturity. I learned that the
original plan was to chip and sell the wood for processing into pulp for
paper production. Although eucalyptus produces a very fine quality chip, I
couldn't help but wonder if there wasn't a higher and better use for this
resource. Ultimately I determined that veneer was the most valuable
commodity that could reliably be made from these trees.
For much of the next decade, my wife Jana and I continued to
investigate how best to make this happen. We attended countless public
meetings from O'okala to Honolulu to make sure this concept was a suitable
fit for the island from an economic, social and environmental standpoint.
The O'okala mill is the fruit of eight years of research, planning,
organizing and research.
We believe our mill can positively affect the people of O'okala and
other communities along the Hamakua Coast and we are committed to
making this happen. We have sold our Portland business to a long-time
employee and have purchased a home in Papaaloa. We are moving in this
week.
As with any new entity, we are not universally loved--people fear what
they do not understand. There is no reason for people in Hawaii to know
anything about wood processing, a fact we originally failed to recognize.
We have been working hard over the past six months to correct that error.
We are here today to provide information so that you, the Council, can be
familiar with our project.
As I am sure you are aware, there is a group that is opposed to our being
in O'okala. They have performed a valuable role in the development of our
facility by raising concerns about the impact our project will have on their
town. The issues brought to us have helped us to look at ways in which we
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can make mill abetter neighbor and have caused us to look a little harder at
heading off potential problems. We believe these folks are sincere in their
doubts, but some of their claims are not based on facts.
The biggest misunderstanding is that we could site our mill virtually
anywhere on the island. We have spent the better part of eight years trying
to find the right location. We evaluated potential sites from Puna to
Honokaa. The veneer mill uses a little more than twenty acres of industrial
zoned land, has an independent water supply, convenient access to the grid,
close proximity to the raw material supply and the ability to stay off the
main highways and out of populated residential areas.
Other sites evaluated failed for a variety of reasons-lack of water,
inappropriate zoning, inadequate access to the grid or excessive highway
travel. The O'okala site has historically been a mill location and the
community around it is there because it provided housing for employees of
the mill.
The second misperception is that the mill will pollute the environment.
This is an easy conclusion to reach if your only exposure to a mill was an
industry that did very little to provide protect;on for the environment or its
workers. We will address the specific issues raised and our responses a little
later.
The third concern is that the mill is just a front for a large power plant
Frankly, we don't know where this idea came from. The mill is composed
of four components; the lathe, the dryer, the turbine generator and the
boiler. The co-generation facility's primary purpose is to provide power and
steam to run our plant. Excess power, i.e., power generated when the
veneer mill is not running, will be sold back to the grid. We have spoken of
the co-gen as a separate unit because in the Pacific Northwest, where power
is relatively cheap, only a few veneer plants have their own cc-gen facility.
BUSINESS BASICS - Why does this work?
The key to establishing a veneer mill on the Big Island is plentiful, high
quality raw material. Eucalyptus plantations are ready to harvest for veneer
production between ages 8 and 10. This allows four or five crops to be
harvested in the time it takes to grow one in temperate forests. This means
using abandoned agriculture land in Hawaii for forestry requires much less
land to produce the needed wood, which in turn helps preserve native
forests.
The Tradewinds veneer mill will process 150,000 cubic meters of logs
each year. Tradewinds owns the cutting rights on 8,300 acres in the
Waiakea Timber Management Area, has secured 3,800acres of PruTimber
plantations and has rights on several other privately-owned tracts. Together
these areas grow enough trees to meet the needs of the mill sustainably.
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Immediately after harvest, the fields will be replanted. Tradewinds will
require only about one-third of the eucalyptus now growing annually in
Hawaii.
Veneer is a high value, high employment product, making it very
appropriate for Hawaii.
PRODUCTS
Tradewinds Forest Products is a veneer mill. Veneer is the product
resulting from peeling a thin layer of wood from a log. Our mill will produce
1/80 thick construction-grade veneer to sell to plywood and LVL producers.
Plywood is made by layering three to seven sheets of veneer with
alternating grain orientation with glue between the layers. Plywood is sold
in 4' x 8' sheets.
Manufacturing laminated veneer lumber, or LVL, is a similar process,
but on a much larger scale. This material is produced in "billets" 4 feet
wide by 60 feet in length. The billets are then cut to size to produce beams,
headers, joists and other load-bearing timbers. The advantages to LVL and
plywood over solid wood lumber are significant, including strength, stability
and utilization of less wood to carry a given load.
After the veneer business is running steadily we will investigate the
feasibility of making plywood for local use.
Veneer can be produced from small diameter trees, resulting in
excellent utilization of the resource. The LVL and plywood manufactured
from eucalyptus is more stable than dimensional (solid) lumber which can
be prone to warping. LVL is the fastest growing market segment of the
timber products industry.
Wood waste from the veneer manufacturing process will be run through
the boiler in the co-gen plant to provide power for the facility. Excess
power capacity will be sold back to the grid.
PRODUCTION PROCESS - How is It made?
Eucalyptus is cut in the plantations using high tech machines designed
to have minimal impact on the soil and to handle the trees carefully to avoid
damage. The machines used eliminate much of the danger of old-style
logging with chainsaws. The machine operator sits in a cab and operates
computer controls to manipulate the machine. These machines hold the
tree upright while cutting, turn it sideways and strips the branches off. The
branches and leaves are left on site to replenish the soils and provide a
surface for the machine to move forward on. The machine automatically
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measures the tree and calculates the best places to cut lengths for timber
production. All of this happens in seconds.
Logs are then transported to the mill for processing. Eucalyptus must be
treated with care to prevent checking. Time is of the essence in processing
to maintain optimal recovery levels. Processing should occur within 24
hours of the tree being cut.
At the mill, the logs may be put into a steam vat for conditioning, a
process of heating to improve lathe performance. After steaming, the logs
will go through a debarker that will strip the fibrous bark from the surface.
At this point, the logs are cut into 8 foot "blocks" which are ready for the
lathe.
Individual logs are placed in the lathe mechanism where they are laser
measured at several hundred different points. The machine calculates the
best position for the log to ensure optimal performance and the log is
presented to the lathe blade. The blade cuts a single continuous sheet 8 feet
wide by as much as 60 feet long. This veneer ribbon is then cut to size,
sorted by grade and sent to the dryer.
The veneer sheets are then run through the dryer. Logs enter the dryer at
50% water. When the veneer emerges from the dryer after only nine
minutes, the water content has dropped to 8%.
After drying, the stacks of dried veneer are shrink wrapped and prepared
for shipping to plywood and LVL manufacturers.
ENVIRONMENTAL CONCERNS - What is the environmental impact?
Clean Air
Six different processes are used to remove 95% of the wood smoke
particulates from the air. Comparable plants show no visible smoke
emerging from the stacks. Emissions are significantly below Hawaii and US
EPA stringent standards.
Clean Water
Water used in the mill will come from the well already in existence on
the mill site. This is situated makai of the water supply for the town of
O'okala. Tradewinds will use only a small percentage of the water
previously used by the sugar mill. Water used in processing will be
recycled, cleaned and returned to the ecosystem using cooling towers and
settling ponds. All water drained from paved areas and roofs on the mill site
will be channeled into the recycling process where any oils, etc. will be
skimmed off and removed.
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Noise
Tradewinds has performed extensive analysis of potential noise levels.
We have committed to sign a binding agreement with the Department of
Health that we will keep noise levels below 60dB during the day--90%
lower than the sound energy currently allowed by health regulations. Sound
levels will be even lower at right.
Traffic
Wherever possible, trucks will be routed off-highway on cane haul
roads. Agreements have been made to trade timber more appropriate for
other uses with processors located in other areas on the island to reduce
truck traffic between harvest sites and the mill. Trucks will not go through
the village, but will use the Old Church Road just to the west and enter and
exit on old care haul road. Each day, at least 1,000 people a drive by the
mill site to hotel and service jobs located in Waikoloa, Kawaihae and Kona.
If good jobs are available closer to home, surely some of these cars will be
spending less time on the road.
HISTORIC PERSPECTIVE
In the early 1920s, Kamehameha Schools started exploring the concept
of industrial forestry with extensive plantings at Honaunau. New plantations
were also started on KS lands in 1997 on the Hamakua coast and at Pahala.
These plantations have now reached a size suitable for harvest for process-
ing as chips or veneer.
C Brewer Company, under the guidance of Tommy Crabb, established
1,000 acres of eucalyptus plantations at Pepeekeo in the 1970s to explore
the feasibility of biomass-based energy production. The research generated
by Mr.Crabb has beer invaluable to those following in his footsteps.
The State of Hawaii has been working to establish a forest products
industry for decades through research and tree planting. In the 1970s and
80s, the Department of Land & Natural Resources, under the leadership of
Governor Burns and Governor Ariyoshi, planted a variety of non-native trees
to determine which species would do best in this environment and to
establish a raw material base to develop an industry. Thanks to their efforts,
we also have a significant volume of standing timber now ready for harvest.
In the 1990s, Governor Cayetano encouraged additional forestry
research and sponsored a conference designed to help jump-start the
industry. One outcome of his effort was a forestry "right to harvest" law.
The Department of Hawaiian Home Lands now considering the
dedication of their Nie Nie Forest to commercial forestry operations. The
opportunity for DHHL to provide the -aw material used to produce building
products for use in Hawaiian homes is a natural fit.
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Senator Akaka and Senator Inouye also sponsored the Hawaii Tropical
Forest Recovery Act of 1992. This Act's Guiding Concept t 8 is to 'Support
and expand the forest products industry and create sustainable commercial
forest to promote economic development and diversification within the
state".
The efforts of these leaders have set the stage for development of a
sophisticated, integrated, world class forest products industry. Tradewinds
Forest Products and other companies are now well positioned to move
forward to complete the vision of three generations of leaders and create a
new economic resource on the Big Island.
BENEFITS TO THE COMMUNITYASLAND
We believe that following in the footsteps of these leaders in developing
a forest products industry will help to provide answers to a number of
Hawaii's pressing needs:
Economic
1. Creating a $30 million per year economic engine that does not depend
upon tourism or government spending helps address the need for
economic diversity. Basic industry jobs are recognized as having very
high impact on creating secondary and tertiary economic activity.
2. Career-path family wage jobs.
3. Rebalancing East/West Hawaii economic opportunities.
4. Rebalancing a very lopsided import-export relationship
5. Tradewinds will establish an open log-yard to sell logs to local
craftsmen and buy logs from local landowners
6. Tradewinds will sell veneers to finished product manufacturers who
produce such products as cabinetry and door skins.
Environmental
7. Reduction of commuter traffic with less need for East Hawaii residents
to go to West Hawaii for work
8. Production of environmentally sound, non-petroleum based electricity.
9. High value forestry supports maintaining green space on the Hamakua
Coast
10. Tradewinds can receive and burn up to 100 tons per day of clean
waste wood, wh ich would otherwise go into the county dump.
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Social
11. Tradewinds will work with the Community College to develop a
certification program for mill workers and to create a curriculum to
provide skills to help potential workers qualify for jobs.
12. Tradewinds will sponsor a $25,000 scholarship program for the
children of mill employees.
13. The post office complex at the mill site is being cleaned, upgraded and
revitalized.
14. New small businesses, such as a small store/caf6, may be drawn to
O'okala to support the community and the mill.
15. Tradewinds will work with the County to establish a volunteer fire
department in O'okala to provide fire suppression at the mill site and
first response to emergencies within the village
16. A small library is being put into the post office building for use by
community members and mill workers
NEIGHBOR RELATIONS
Tradewinds is committed to being a good neighbor. We have
committed to meet or exceed all environmental requirements. We are
dedicated to cooperating with the community to re-estabiish amenities and
services such as a small store, a park, and day care for working parents. We
have worked hard to address the concerns expressed by the community,
including noise, traffic, etc.
COMMUNITY SUPPORT
Tradewinds was invited to locate in O'okala by two residents in
November of 2005. We met with the community at Ziroli's woodshop in
December where we received strong support. Based on this support we
secured the old sugar mill site and began engineering. We held a follow-up
meeting at our home in O'okala in January of 2006 where we answered
questions about the mill.
A group of residents announced opposition to utilizing the industrial
site for industrial purposes in July of 2006. We have done our best to
address the concerns raised and provide the information needed to
understand our project and its impact on the community. We intend to
continue our efforts to keep our neighbors informed on our progress as the
construction proceeds. We have an individual who is our representative to
the community whose job is to answer questions and resolve problems.
Unfortunately, it is not possible to please everyone.
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At this time, many of the long term, multi-generation residents have
formed a group which favors economic development and the return of jobs
to the Hamakua Coast.
Our project has received support from:
The Mayor's office
The 2006 legislature
Department of Business and Economic Development
Department of Labor and Industrial Relations
Department of Land and Natural Resources
Senator Inouye's Office
Kamehameha Schools
Hawaii Forest Industry Association
ILWU
CURRENT STATUS
Initial funding was obtained in September of 2005. The next phase of
funding was completed in October of 2006. The remaining funding,
including debt and equity, is projected for completion by February of 2007.
We have applied for our air permit from the Department of Health. The
air permit will be followed by the stormwater and sanitary permits. We have
also started a series of permits with County Planning and Building
Departments. When these permits in hand, construction will begin and is
expected to take approximately one year.
• General arrangements and preliminary engineering are completed.
¦ Request for air permit is filed with the Department of Health.
¦ Three of the four major machine centers have been purchased or
ordered. Purchase of the fourth component is in negotiations.
• Preparations are underway for county plan approval.
• Construction contracts are well underway.
• Key employees have been hired.
• A wide spectrum of people are now working together to make
Tradewinds a reality, from engineers in Texas, Colorado and Oregon,
to equipment manufacturers in Finland and France, to residents of
O'okala.
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