Archive for May, 2009

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The Lacey Act – What Does it Mean for Hardwood Consumers?

May 5, 2009

On May 22, 2008, the United States congress passed the Lacey Act, amending the existing statute that had previously been used primarily for fighting wildlife crime. Now, the act serves to ban illegally sourced plants and products, promoting a new standard of environmental responsibility for U.S. importers of natural products from abroad. Many companies are already devoted to the use of sustainable harvesting practices, and are therefore already in full compliance with the Lacey Act amendment. Certified vendors of Forest Stewardship Council (FSC) certified products and consumers alike should be happy to see United States policy makers taking steps to ensure the health and well-being of forests and plant species around the world.

What does this mean for the engineered flooring world? As aforementioned, very little for those companies who were already abiding by the rules of healthy business and global ethics. But naturally, the reality is that more bureaucracy means more time, more documentation, and more labor/cost for import/export companies and mills. Therefore, prices for imported hardwoods have to rise proportionally to accommodate this. FSC certification, which establishes a “chain of custody” from the harvest source to the end consumer, also creates this price increase to accommodate for its intensive documentation fees.

For example, engineered Brazilian Cherry flooring coming out of Brazil has to pass through customs in order to make it into the United States, this much you already knew. However, this is a one time fee, with taxes and tarriffs paid at the border. With FSC certification, for example, the wood must be documented each time it changes hands. This means that a representative of the FSC or an agent working on their behalf (Such as SCS, Scientific Certification Systems) must approve each of these transactions and/or documentation must be filled out and filed, requiring extra time and labor. In effect, it’s like going through customs every time the wood changes hands. The Lacey Act is similar in that it requires more documentation than was previously required in order to import goods. Filling out this documentation requires time on the part of the mills, and the added cost trickles down through the supply chain thereafter. Additionally, the fact that engineered flooring features a wear layer of the exotic specie, and therefore not as much of the wood as a solid hardwood, does not lessen the cost of these certifications. Even if one board in the sub-bundle had a Brazilian Cherry wear layer and the rest were bare plywood, in order to be certified, that board must be tracked along the chain of custody in order to be FSC certified. What raises the cost is certifying multiple locations, such as if a distributor had multiple storage locations. For this reason, it is important to realize that if some hardwood dealers are slow to adopt FSC certification, it is not necessarily because they are illegally harvesting or conducting unethical business practices; the fact is, FSC certification can be a very expensive and complicated process.

However, though these certification processes and newly instated laws do raise costs slightly to the end consumer and create more bureaucratic red tape and cost for every member of the supply chain, they are great advancements towards promoting sustainable harvesting practices and punishing those who would otherwise seek to profit from harming the planet through the poaching of natural products.

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