Guitaronomics: The Rising Cost of Tonewood

guitaronomics.jpg

Here is another article about the international tonewood market and the coming tonewood famine.

https://reverb.com/au/news/guitaronomics-the-rising-cost-of-tonewood

“Guitar enthusiasts love to talk about tonewood….. Rarely do the words sustainability or scarcity come up.

These terms, however, are now central to the lexicon of the guitar industry.”

The article features comments from three people in the tonewood market:

Chris Herrod of Luthiers Mercantile International [LMI], a major American tonewood retailer, which is seeing major changes in the tonewood market.

“LMI aims to provide as many “new” varieties [of tonewoods] they can find to offer alternatives to the classics while educating the customer base along the way.”

Perry Ormsby a small Perth [Australia]-based luthier provides us with this great quote:

“Using Tasmanian blackwood (Acacia melanoxylon) as a substitution [for Honduran mahogany] has been a game changer.”

“A close cousin to Hawaiian Koa, it is heavier than mahogany and difficult to work with, but it sounds great. It looks cool, and it’s Aussie,” Ormsby says.

“When his customers are educated about the wide range of wood possibilities he is using and and see the results, it makes them rethink everything they wanted out of their dream guitar.”

And finally Bob Taylor from Taylor Guitars features prominently in the article.

“When the wood is in rare supply, the price goes up. Nearly all our woods have probably increased in price about 15% over the last few years. I don’t blame this on regulation. I blame it on supply. But since the supply is so low, it’s also become highly regulated to the point of illegality.”

In addition to its ebony partnership in Cameroon in west Africa, Taylor have also started a company called Paniolo Tonewoods, a partnership with Pacific Rim Tonewoods. Together they are undertaking a massive planting of Koa (Acacia koa) timber in Hawaii.

Tasmanian blackwood also gets a mention within the discussion about Taylor Guitars as a growing alternative sustainable tonewood.

But I’m not sure the article finishes on the right note.

There’s a strong emphasis on nostalgia and traditional tonewoods. There is not a strong message about the future and sustainable tonewoods.

In that regard it tends to reflect where the general tonewood market is at right now – caught between the traditional buying habits of its customers and lacking the commitment and leadership to move to a sustainable future.

But the time of the profitable sustainable tonewood will come; perhaps in the next few years.

Ultimately if the tonewood market wants to continue to access quality wood then it will have to start paying farmers to plant trees. There is no other option.

Will Tasmania be ready when the time comes?

The forests behind the label – Why standards are not enough

Here’s a great Ted Talk about going beyond Forest Certification with the focus on small scale forest growers like existing and potential Tasmanian blackwood growers.

And when I think about the synergies between their connect-with-the grower model and a Tasmanian Blackwood Growers Cooperative I get excited.

This is just what Tasmanian blackwood growers need to get the support and recognition.

It’s about connecting consumers and manufacturers with forest growers.

What a great idea!

The Ted Talk is by Constance McDermott who is a James Martin Senior Fellow and Chair of the Forest Governance Group at the Environmental Change Institute, University of Oxford.

http://www.eci.ox.ac.uk/people/cmcdermott.html

This is a 12 minute talk well worth watching.

Hydrowood blackwood prices at Uptons

HWs.jpg

It’s time for another blackwood timber market price review, this time courtesy of Hydrowood and Uptons.

http://hydrowood.com.au/news/hydrowood-now-available-at-uptons/

http://uptons.net.au/

My previous price list reviews have generally not named the suppliers, but in this instance I think I need too since Hydrowood is likely to be the major supplier of premium grade blackwood timber for the next 5 to 10+ years. Hydrowood will therefore set the price ceiling for quite some time.

Go here to read my reviews of other blackwood (and other species) timber price lists:

https://blackwoodgrowers.com.au/category/price-lists/

Here are the current prices are for Hydrowood blackwood from Uptons:

HydrowoodBWD

These prices are for rough-sawn, kiln-dried blackwood timber.

It’s a curious price list for a number of reasons.

Firstly there are only two grades of Hydrowood blackwood – fiddleback and everything else! The price for select (clear) grade is the same as for natural (knotty& defective)!!

The other curious feature (and I’ve discussed this in relation to other timber price lists) is the lack of price increase (per cubic metre) with increasing piece size. Whilst you can cut large trees into small pieces of wood the reverse is not true. You can only cut large dimension timber from bigger, older trees. And bigger, older trees cost more time and money to grow. Therefore larger dimension timber should attract a higher per cubic metre price to reflect the higher cost to the grower.

Of course there isn’t a “grower” in this case, but given that the owner of this resource (the Tasmanian Government) isn’t charging any royalties, and Hydrowood are a dominant supplier in the blackwood market, this creates significant pricing distortions in the marketplace.

But there’s the thing. These prices bear no relationship to the cost of growing the wood. This is salvage timber from the bottom of hydro lakes. No forest management costs, no roading costs, no expensive forest practices plans, no royalties paid to the Government!

This is low cost blackwood.

In that regard it shares much with Forestry Tasmania the other major producer of blackwood. Forestry Tasmania produces blackwood at below cost and receives a direct taxpayer subsidy for doing so.

If we want to encourage and develop a profitable sustainable forest industry then this isn’t the way to do it!

This blackwood is even cheaper than Select grade Tas Oak at Bunnings!!

https://blackwoodgrowers.com.au/2016/07/01/bunnings-timber-price-lists/

The other interesting feature of the Hydrowood price list is that there are only three pricing structures for all of their species/products, of which two are shown in the above chart.

The Natural/Select Blackwood pricing is shared with plain Myrtle, or what Hydrowood calls Western Beech (Nothofagus cunninghamii), and Tas Oak (Eucalyptus sp.)!! The fiddleback blackwood pricing structure is shared with Black Heart Sassafras (Atherosperma moschatum), Huon pine (Lagarostrobos franklinii), Marine-grade Celery Top Pine (Phyllocladus aspleniifolius), and flame-grain Myrtle/Western Beech. An intermediate pricing of $5,900 per cubic metre is applied to all Knotty Celery Top pine and plain coloured Sassafras.

Of course the impact of these pricing structures on the future of the other (non-blackwood) species is irrelevant. These other slow-growing species do not provide any investment opportunities. But farmers can invest in growing commercial blackwood provided that markets are working properly, and Government and industry policy is supportive.

No chance of that here in Tasmania.

This is the fourth blackwood timber price list I have reviewed and what these price lists show is a blackwood marketplace in disarray. Blackwood prices are all over the place, from cheaper than radiata pine, to prices that rival the most expensive premium timbers in the world!

If you were wondering whether to invest in growing commercial blackwood then this marketplace would not provide you with any confidence. I wish I could say that these prices clearly demonstrate the viability of growing commercial blackwood but I can’t.

These blackwood timber price lists do not reflect the cost of growing the wood. Nor do they reflect an industry that has a vision for its future. Instead they remind me more of a closing down sale!

They reflect an industry that has lost hope, and is now in a desperate race to the bottom.

Without a solid commercial foundation the forest industry doesn’t have a future.

So now you know where to get your cheap premium blackwood timber.

When will Tasmania get a fully commercial profitable forest industry?

 

Cort Guitars expanding use of blackwood

CortAS06

Giant Korean-based guitar manufacturer Cort continues to expand its range of guitars featuring Australian blackwood.

http://www.cortguitars.net/en/

Cort produce guitars for other well known brands under license but also have their own brand.

In addition to limited edition models for the Australian market, Cort is now expanding the use of blackwood in its international models.

Here are a few examples:

Frank Gambale Signature (FGS) model

I previewed this new model back in February:

https://blackwoodgrowers.com.au/2016/02/29/cort-frank-gambale-signature-model/

AS 06 Orchestra Model (OM)

http://www.cortguitars.net/en/product/product_view.asp?qCate=00002&qSeries=0&qProdTag=&qPack=&qNew=&qKey=all&qWord=&idx=168

The AS series is Cort’s flagship series of premium acoustic guitars. The other models in the series feature Indian Rosewood and Mahogany. The AS06 is the first AS model to feature an “exotic” non-traditional tonewood.

Both the AS06 and the FGS models are top-of-the-line acoustic guitars featuring solid blackwood back and sides. Both retail for about $AU1,500 but neither is currently available in Australia.

But if you want something really special from Cort check out their 1200 series models. To date only three 1200 models have been produced the Earth 1200 dreadnought, the L1200P parlor and the MR1200FX dreadnought. All of these models feature solid rosewood, but I do have concerns about the legality and sustainability of rosewood timber. Now if a 1200 blackwood model should ever come along I’ll be down the shop in no time, and ringing bells on this website!!

Grand Regal GA5F-BW

Another recent addition to Cort’s international range. A Grand Auditorium body in a mid-priced guitar.

http://www.cortguitars.net/en/product/product_view.asp?qCate=00002&qSeries=0&qProdTag=&qPack=&qNew=&qKey=all&qWord=&idx=203

This model is available in Australia and retails for around $650.

MR710F –BW

A mid-priced Dreadnought workhorse featuring blackwood that retails for around $600.

http://www.cortguitars.com/uk/product/mr710f-bw

Ukeleles

Cort_Ukulele

Cort’s answer to the ukulele craze that has gripped the planet for the past 10 years is a series of solid quality blackwood ukes.

http://www.cortguitars.net/en/product/series_view.asp?qCate=00002&idx=154

Cort SJB Blackwood

And for the bass players the Cort SJB Blackwood. This model is currently only available in Australia.

http://www.basscentre.com.au/collections/acoustic-basses/products/cort-sjb5-blackwood

Cort-sjb-blackwood

Cort’s ability to gain exposure for blackwood tonewood by catering to the mass guitar market can only be a good thing. Blackwood may be highly regarded in the domestic Australian guitar market but it is still largely unknown overseas.

With a production capacity of over 1,000,000 guitars per year (I read somewhere that this represents 30% of total world production!) even if 1% of that production included blackwood it would provide a significant boost to local demand for blackwood timber. All of these guitars use plain-grain blackwood which is another bonus to growers.

It would be fantastic if Cort joined the growing trend for guitar companies to demonstrate greater environmental and social awareness and engagement as a good global corporate citizen.

Carrabin first inventory

IMG_0482.jpeg

A few months back I had the opportunity to do the first inventory measurement of the Carrabin blackwood plantation.

You can read about this plantation in my previous blogs including the major thinning in 2013:

https://blackwoodgrowers.com.au/2013/11/13/carrabin-first-thinning/

The plantation is now 16 years old and 3 years since its major thinning.

There are still about 20 trees to be removed before the plantation reaches its final stocking of approximately 36 trees. The above picture shows recent thinning in progress.

In all 39 trees were marked and measured. Here are the results:

Carrabin Table

Note that the objective is to grow blackwood trees that have single straight stems pruned to at least 6.0 metres, and a breast height diametre (DBHOB) of 60cm when harvested.

Because of the close initial planting (2x2m) and the delayed thinning, the remaining trees do not have the diameter I would expect for this age. The largest trees are 27 cm diameter.

As these trees rebuild their crowns following the 2013 thinning I expect the diameter growth rate to increase. Another inventory in 5 years will tell us whether this has happened.

This blackwood plantation is a real credit to the commitment and dedication of the owner.

This is how the special timbers industry should be in Tasmania. Not a politically motivated taxpayer-funded junket into our last remaining public old growth forests.

 

 

Review of the DRAFT Tasmanian Wilderness World Heritage Area Management Plan 2014: Director’s report and representations

The Tasmanian Planning Commission (TPC) has just released the TWWHA Managememt Plan 2014: Director Report and Representations.

http://www.iplan.tas.gov.au/Common/Output/TrimWS.aspx?id=811538&ext=PDF

With UNESCO emphatically ruling out it out the issue of logging special timbers in the TWWHA is now dead and buried (at least until the next management plan review).

Timber Harvesting is discussed on pages 11-12 of the TPC report.

However the TPC is clearly confused. It interpreted my representation as supporting special timbers logging in the World Heritage Area!!

Ok! Maybe I didn’t explicitly say NO!

Maybe I was too analytic and not emphatic enough.

https://blackwoodgrowers.com.au/2015/02/10/draft-twwha-management-plan-representation/

So let me make this perfectly and emphatically clear –

In no way do I agree that the Draft Plan “allow[ed] the management of Tasmania’s unique special species timber for sustainable production within legislated categories of reserves …[whilst] not compromising the Outstanding Universal Values for the TWWHA”.

I do NOT support any special timbers harvesting in the TWWHA!!

I just wanted to clear that up and leave no doubt in anyone’s mind.

Resource-sensitive Global Production Networks (GPN): Reconfigured Geographies of Timber and Acoustic Guitar Manufacturing

Taylor300

A few months back I was contacted by two academics based at the University of Wollongong, New South Wales. They are economic geographers and were starting a project looking at local and international tonewood markets.

Chris Gibson and Andrew Warren came to Hobart and I was pleased to catch up and discuss issues around tonewood supply and tonewood markets.

On their way to writing a book on the subject they have published the first academic paper from their research so far.

Chris Gibson & Andrew Warren (2016): Resource-Sensitive Global Production Networks: Reconfigured Geographies of Timber and Acoustic Guitar Manufacturing, Economic Geography, DOI: 10.1080/00130095.2016.1178569

http://www.tandfonline.com/doi/pdf/10.1080/00130095.2016.1178569

Unfortunately this paper doesn’t make for easy reading with 22 pages of dense, convoluted prose.

I would encourage the authors to write a shortened popular version of the paper as I have no doubt they would find plenty of consumer and industry magazines and websites keen to publish.

Here’s my review.

Where in the 1970’s and 1980’s labour costs and shifts in production to cheap labour markets were the dominant force in the guitar industry, today it is access to secure, reliable wood resources that is becoming the major industry driver. This is happening within an increasingly complex, increasingly regulated international trade in wood resources.

Such [increasing] regulation [and diminishing supply] has, since the 1990s, transformed both tonewood procurement and guitar making. A resource-sensitive GPN has emerged in which upstream resource actors are increasingly important, with manufacturing firms responding differently to scarcity and regulation. Other industries dependent on timber, such as paper milling, furniture, and the construction industry are not as species dependent and have been able to switch more easily to substitutes, including quick-growing plantation species sourced locally. Guitar manufacturers for the most part remained bound by the guitar’s type form, requiring timbers with tensile strength, aesthetics of color and grain, and rich acoustic resonance. Moreover, as a form of manufacturing appealing to consumers for whom emotional value and identity-affirming qualities were intrinsic, the industry was encumbered with strong traditions and customer expectations. As Dick Boak, from C. F. Martin & Co., explained, convincing guitarists to switch to instruments made from sustainable materials proved difficult: “musicians, who represent some of the most savvy, ecologically minded people around, are resistant to anything about changing the tone of their guitars”. Put simply, “musicians cling to the old materials”.

As I’ve said previously, guitar companies are often their own worst enemies when it comes to product development, marketing and mixed/confused messages. Even the most evangelical of guitar manufacturers still provide a soft, oblique message to the market when it comes to environmental issues. But the aesthetic and the exotic become the focus when it comes to sales and marketing. Many guitar companies show no concern about resource supply and environmental issues whatsoever.

https://blackwoodgrowers.com.au/2015/08/11/ooops-not-such-a-success/

But there is evidence that consumer and market change is coming. Just a few examples include the No More Blood Wood campaign, the Leonardo Guitar Research Project, and the Musicians for Sustainable Tonewoods:

http://reverb.org/no-more-blood-wood-campaign/

http://www.leonardo-guitar-research.com/

https://www.facebook.com/Musicians-for-Sustainable-Tone-Wood-100977326654291/

The 2009 and 2011 raids on the Gibson Guitar Company by US law enforcement agencies in relation to importing endangered species were a watershed moment for the guitar/tonewood industry, sending shockwaves throughout the marketplace and concerned consumers.

Irrespective of the evidence and veracity of the raids, in August 2012, Gibson settled out of court, effectively admitting to violating the Lacey Act, and agreed to a $300,000 fine.

Since 2011 the international tonewood market has changed dramatically. The paper highlights three strategies being used by guitar manufacturers to adjust to the changing tonewood market:

  • Alternative species
  • Vertical integration
  • Salvage wood

In short, material scarcity in combination with higher degrees of CITES/Lacey Act enforcement made legally sound international procurement of traditional timbers more difficult, inconsistent in quality, and expensive. Accordingly, product innovation ensued, entailing new models that shifted away from rosewoods, ebonies, and mahoganies of potentially suspicious provenance, toward new alternative timbers that satisfied strength, resonance, and aesthetic benchmarks, and that could be sourced either locally or more transparently from countries with robust regulation, certification, and enforcement.

Well that is a trend that is only just beginning. If you look at most guitar websites you will still find rosewood, mahogany and ebony in abundance.

Much of the search for alternative species is focused on other tropical rainforest timbers not on the CITES list. A few American companies are increasing their focus on readily available North American hardwood species. In Australia the two commercial makers, Maton and Cole Clark, are increasing their use of locally grown and native timbers.

Taylor Guitars so far is the only major company following the vertical integration pathway back up the supply chain to timber cultivation, harvesting and milling. This is really only an option for large companies that have the resources necessary to invest upstream.

Rather than engaging in the expensive option of buying land and growing trees themselves, these companies should consider the option of contracting the growing and supply of tonewood to local farmer cooperatives. I’m pretty confident that if a major company pursued this option in Tasmania it would receive plenty of positive support from the farming community.

The third strategy being developed by small-to-medium size guitar companies is the use of salvage wood from specialised “timber hunters”. The problem here is that salvage wood is not a secure long-term resource. It comes with increased risk of resource supply. It also doesn’t help the major manufacturers and therefore the bulk of the guitar-buying public who can’t afford custom built guitars, ie. there are no large volumes of salvage wood available.

 

So how can Tasmanian blackwood feature in these three tonewood strategies?

  1. Tasmanian blackwood is one of the few alternative quality tonewood species that is non-tropical and potentially sustainable. It can be grown in profitable commercial plantations. It is well known in the domestic Australian market but has yet to break into the international market. Efforts by Taylor and Cort to introduce blackwood into international markets will hopeful make progress in this area.
  2. Taylor Guitars have strong links with their Tasmanian supplier (Tasmanian Tonewoods) but have yet to demonstrate any commitment beyond this relationship. To date their vertical integration is confined to the USA, and Cameroon in Africa in partnership with Madinter. Will other major guitar companies follow Taylor’s lead and seek upstream supply relationships?
  3. There is a sizable existing blackwood resource suitable for salvage on farmland across northern Tasmania, from Goulds Country in the east, to Marrawah on the west coast. This unmanaged resource of native remnant and planted blackwood could be used to stimulate farmer interest in growing commercial blackwood, whilst supplying international tonewood markets in the short term, should a major buyer wish to take up this opportunity.

Tasmanian blackwood is discussed on page 19 of the paper.

Following the Australian lead (Maton and Cole Clark), North American tonewood suppliers and manufacturers began importing Australian blackwood to use in high-end production guitars. A species considered invasive in some areas (unlike practically all other tonewoods), Australian blackwood is harvested in small volumes from farms and mixed-forest plantations without the need for invasive harvesting techniques or CITES paperwork (Reid 2006).

I don’t know where the mixed-forest blackwood plantations are? I’ve never heard anything about them. And why mention the invasive bit? The invasive tendencies of other species are not discussed at all. If blackwood is planted on Tasmanian farms where it is already a native how can it be considered invasive?

The only way that the tonewood market can have a secure future is to pay landowners to grow trees. Unfortunately the paper fails to discuss this strategy, I guess because so far none of the guitar companies are actually using this strategy.

Major manufacturers need significant volumes of quality timber and they need resource security to safeguard their investment. This means paying people to actually grow trees, and having strong, long-term relationships with growers.

The paper focuses on the current changing dynamics in the international tonewood market which are still in their infancy.

As the paper states, the current changes are unpredictable and likely to result in unexpected outcomes as new players and new opportunities emerge. The interplay between the consumer, the manufacturer, the supply chain, and the grower will result in significant market changes.

One important piece of information missing in the paper is an estimate of the size of the international tonewood market. In all the dense discussion it is not possible to get a sense of scale of the issue. On pages 10-11 there is a table providing some statistics about example companies, including production and employment, but nothing about tonewood demand.

Another observation is that the paper talks about the tonewood market everywhere from sawmillers/tonewood merchants all the way through to consumers; but fails to discuss forests, plantations and growers. If there’s a tonewood supply problem then not discussing trees and growers seems a bit odd.

So who will grow the tonewoods of the future?

I’m looking forward to seeing what these academics come up with over the next year or so of their project.