Port could bring wood exports to Bellingham Shipping Terminal, but proposal draws criticism

Port could bring wood exports to Bellingham Shipping Terminal, but proposal draws criticism
Under a proposed deal, two companies would lease about 20 acres near the Whatcom Waterway for shipping forest products to Asia. [Oliver Lazenby Photo | The BBJ]

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Filed on 30. Nov, 2015 in Features, New Business, News

Logs and other forest products could soon be shipped from the Bellingham Shipping Terminal for the first time since the late 1990s.

The Port of Bellingham is negotiating with companies that want to export logs and timber products to Asia from a 20-acre site at the log pond area of the Bellingham Shipping Terminal, near the Whatcom Waterway.

At a Nov. 10 meeting, port commissioners voted to enter an exclusive negotiating period with two companies: DKoram, a Hong Kong log exporting company with an Aberdeen location; and British Columbia-based Bio-Fibre Manufacturing (BFM). Under the agreement, the port can’t negotiate with other forest-product companies until the due diligence period ends on April 29, 2016. The port agreement doesn’t prevent the port from negotiating with firms in other industries.

The proposed project could employ 50 workers and bring 50 to 150 trucks a day to the waterfront. It would be a big step in the transformation of the Bellingham Shipping Terminal, but a local environmental group has criticized the project, saying that it could lead to intensified logging in local forests and increased carbon emissions in Asia.

DKoram and BFM proposed the project together and are working jointly on it. DKoram would ship logs and BFM would ship biofuels — wood chips and wood pellets that would be burned with coal to produce energy. The companies would source logs and scrap wood from Whatcom, Skagit and Snohomish counties, and ship to China, South Korea and Japan, company leaders said.

Steve Grandorff, DKoram general manager, said it’s too early to tell how many logs his company would need to export for the project to be profitable. At full capacity, BFM could ship 60,000 tons of wood chips a month, according to its website.

Environmental concerns

That sounds like a lot of wood to local environmental advocacy group ForestEthics.

Jim Ace, campaigner for ForestEthics, suspects logging would have to intensify to supply 50 to 150 trucks a day. He said in a prepared statement that the project could devastate local forests, as well as salmon and marine life.

“The damage to salmon streams and destabilization of slopes will be permanent, or take decades or centuries to recover,” he said. “Bellingham’s forests provide jobs (and quality of life) here in Washington. Cutting and sending them overseas will send good jobs with them.”

Industry growth

Much of Ace’s concern comes from the explosion of the wood pellet businesses in the southeastern United States. That part of the country currently has 24 wood pellet mills, and companies have proposed 27 additional mills, according to an October 2015 report by the Natural Resources Defense Council.

U.S. wood pellet exports doubled from 1.6 million tons annually in 2012 to 3.2 million tons in 2013. They increased again by nearly 40 percent from 2013 to 2014 and are expected to reach 5.7 million tons this year, according to the report.

The growth is due to a market for wood pellets in Europe, where some energy companies have converted coal-fired plants to wood-fired to meet new European Union greenhouse gas emissions standards. But if wood chips and pellets used for energy production are produced from whole trees, rather than scrap material, their carbon emissions can be greater than coal, according to the Natural Resources Defense Council.

The Natural Resources Defense Council calls the EU regulations flawed. Burning wood in energy plants can release less carbon than coal if the wood burned is waste that would otherwise decompose and release carbon anyway. But growing trees specifically for energy production negates any carbon benefits, according to the Natural Resources Defense Council.

Carbon regulations are also driving demand for wood pellets in Japan, South Korea and China, according to a 2012 study by the U.S. Forest Service.

BFM would source wood chips and pellets from waste wood such as, bark, dirty chips, pulp logs and previously unusable waste wood, Sebel said. The company would also allow tree farmers and contractors to sell wood products to the facility.

Renewed interest in terminal

The port’s cleanup and dredging project has attracted attention to the Bellingham Shipping Terminal, Stahl told Port of Bellingham commissioners on Nov. 10.

American Construction is currently working on the first phase of a $35 million cleanup in the Whatcom Waterway and should finish in March. The project will increase the depth of the waterway to 35-40 feet at low tide.

DKoram and BFM would ship their forest products on vessels with a capacity of about 35,000 tons, Sebel said. Ships with that capacity are typically just under 600 feet long—slightly smaller than the Horizon Fairbanks ship currently moored at the port, Stahl said.

Stahl didn’t have an estimate for how much the port would charge the companies to lease the space or whether ship mooring charges would apply.

Both Sebel and Grandorff said the site is well-suited to their business. Their due diligence is focused on market factors and securing a supply of logs and forest products.

“[The site] has everything you need to facilitate exporting logs or other types of forest resources. It’s a good set up for that particular function.” Grandorff said.

Oliver Lazenby, associate editor of The Bellingham Business Journal, can be reached at 360-647-8805, Ext. 5052, or olazenby@bbjtoday.com

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IFRoZSBKb3VybmFsPC9saT48L3VsPg==