Policy Update U.S. – China Trade Negotiations

Friday, February 22nd, 2019

The Hardwood Federation has released an update about the current state of tariff trade negotiations between the U.S. and China. This is an ongoing process, so updates will continue.

Overview: 

  • The U.S. and China wrapped up a week of negotiations in China last Friday. 
  • Both sides reported that they made “progress,” including more substantive discussions and reported Chinese concessions on key structural issues that are a priority for the United States. Discussions continue this week in Washington, D.C. 
  • President Trump has indicated a willingness to suspend increases in tariff levels if discussions continue to be positive and a deal is close.  However, we do not anticipate a decision will be made until very close to the March 1 deadline.

Background:

On Friday, U.S. and Chinese negotiators wrapped up five days of bilateral trade negotiations in Beijing.  The White House described these discussions as “detailed and intensive” and the Chinese government also indicated progress. 
 
Coming into these talks, the U.S. delegation was expected to continue pushing for changes that roughly fall into three “buckets” – increased purchases of U.S. commodities, Chinese policy changes to address structural concerns raised by the United States (such as intellectual property theft, cyber-hacking and industrial policy), and specific mechanisms to hold China accountable for meeting specific commitments.  Of those areas, the first area (increased purchases of commodities) was both the easiest issue to resolve and the area in which the Chinese have been most willing to offer concessions.  Verification and monitoring are considered the most difficult.
 
Following discussions, the White House issued a statement noting that the U.S. delegation focused first on structural issues, including a series of issues where discussions continued from earlier rounds: forced technology transfer, intellectual property rights, cyber theft, agriculture, services, non-tariff barriers, and currency. The statement also makes references to increased purchases of U.S. goods and services; Chinese negotiators had previously offered agricultural products in this bucket but also reportedly offered semiconductors as another potential area. Interestingly, the U.S. statement does not make any explicit reference to verification and monitoring mechanisms.  U.S. officials have purportedly suggested various mechanisms to enforce any commitment made, including “snap-back” tariffs, rotating lists of retaliatory tariffs, trade remedy actions, or even the re-imposition of WTO safeguards against import surges.
 
The White House statement also hints more explicitly than in the past about the form of any potential deal, noting that any commitments would be included as a memorandum of understanding (MOU) between the two countries, a form that is more substantial than just a joint statement.  It does not, however, provide any clear indication of a postponement or extension of the negotiating period, stating only that the two sides were working hard to strike a deal in advance of the March 1 deadline set by the two leaders. The two sides will meet again next week in Washington to continue talks – both at the lead negotiator level as well as the working-level.

The Story of a Man, a Kitchen Table, and a Dream

Friday, February 1st, 2019

Member Spotlight | Tropical Forest Products


The kitchen table serves as more than just a place for family meals. It is the hub of the home — a place where important family conversations happen, where visiting friends gravitate to socialize, where projects, budgeting, and homework take place. And for Jordan Dery, the founder of Tropical Forest Products, the kitchen table is where his idea to start a lumber company came to fruition.

The Kitchen Table


A native of Quebec, Canada, Jordan began his career in the hardwood lumber industry when he was just 20 years old. He graduated from the NHLA Inspector Training School in 2013, where he gained life-long friends and developed skills that would one day propel him to starting his own hardwood lumber business. 


The journey to the creation of his business began in 2016 when Jordan took a three-month holiday to explore Asia. While visiting Indonesia, he toured a local sawmill and was inspired. Jordan recalls his moment of clarity, “I’d always loved the hardwood industry and the people in it. This is my passion! I should start my own lumber company.”


He immediately called his twin brother, Justin Dery, who was already in the hardwood lumber industry. As Jordan excitedly told Justin he was going to start his own lumber company, Justin was wary, exclaiming, “you’re crazy!”  Justin knew that starting a lumber company from scratch would be a massive undertaking and wanted to protect Jordan from making a costly mistake, but his skepticism didn’t last long. 


Jordan returned home just before Christmas, and by New Year’s Day 2017, his brand-new business was taking shape. Soon, his brother joined the company as its vice president and their longtime friend, Jassi Jaskaran, signed-on to handle sales & purchasing. The newly-created business was named “Tropical Forest Products,” and the center of operations was the kitchen table at their family home. 


The first order of business was to join NHLA, which was instrumental in building strong relationships within the hardwood lumber industry. When Tropical Forest Products began, they didn’t have any credit, so they turned to their friends in the hardwood industry for help. These friends trusted his vision and allowed him to use their lumber yards and warehouses to build loads. The first loads sold by Tropical Forest Products weren’t backed by contracts. Instead, the deals consisted of a handshake and Jordan’s word.


By June of 2017, Tropical Forest Products moved into its first warehouse, which was previously used to store old car-parts. “The warehouse was completely disgusting,” said Jordan, “the entire building had to be gutted and completely remodeled before it could be used to house lumber. The first load at the new warehouse looked tiny, sitting all alone in the 30,000 square foot goliath. It just looked like a ghost town.”


2017 was challenging, and Tropical Forest Products had many obstacles to overcome, including some of their customers declaring bankruptcy. Jordan laments, “It was devastating, but we all came together with the understanding that it would take a lot of hard work to make up for the money we’d lost. We had to put in long hours, hitting the phones all day every day, trying to get new customers. It was tough, but we managed to double our goals in our first year.”  It didn’t take long for their ghost town of a warehouse to become filled with lumber. In fact, Tropical Forest Products has grown so much that they will be moving into a bigger warehouse in November of 2019.


The Tropical Forest Products Warehouse


Jordan’s approach to managing the business revolves around two things:  happy employees and satisfied customers. Jordan’s mantra is, “work at a job you love, and you’ll never work a day in your life.”  He extolls the importance of employees spending time with their families, saying, “I let my team know their health and family should always come first. I really believe that. I want my employees to know their company supports them, that we trust them.”


The growth continues at Tropical Forest Products, as they are proud to announce their recent merger with the Lumber Decking Company out of Miami. Jordan points out, “This merger provides a great opportunity for growth. The CEO of the Lumber Decking Company, Kris Kanagenthran, has been one of my greatest mentors since I began in the hardwood lumber industry. I know we need strong leadership to take us to the next level. I trust his leadership and share his vision.”


From its humble beginning of three men working at a kitchen table, Tropical Forest Products has matured into a business that employees a full staff with clients across the world. Instead of borrowing lumber yards and warehouses from friends, they now have their own. Jordan is proud to be a member of NHLA, acknowledging, “None of our success would have been possible if it weren’t for relationships we built through NHLA, our customers, and our suppliers. The friendships we built became the support we needed to get our feet off the ground. They wanted us to succeed. They set us up to triumph.”