TREE OWNERS NEWS
Summer 2001
Our excitement builds daily as the
trees on all of the farms continue to grow beautifully, as our early thinnings
continue to exceed expectations, and as our plans for Raleo Design™ near
fruition. It is difficult to
express our feelings of fulfillment as everything moves strongly forward. We thank you all for making all of this possible.
So
far this year we have had the blessing of more than 50
tree owners visiting the farms. Here
Steve is pictured
with two tree owners enjoying their three year old teak.
We have held our prices for nearly a year, and now they must go up. We
will be increasing the prices for all of our species effective
August 20.
It is hard to believe how fast time has
flown by since the end of the year, but we want you to know that you helped make
2000 a wonderful year. With your
help and support, in 2000 we:
- completed the first early thinnings of our 1992 teak and
1993 idigbo
-
added and planted our eighth farm, San Gabriel
-
planted 150,000 tropical
hardwood trees, bringing our new total planted to more than 1,160,000
-
were honored with a private
luncheon with Doña Gloria Bejarano de Calderón, the former first lady of
Costa Rica
-
gave young tropical hardwood
seedlings to every student in all of the nearby schools to take home and
plant, 634 in all
-
finished work on a 9,000 square
foot lumber storage facility on Campo Real
-
held another joyous Christmas
party for our wonderful workers and their families, more than 600 happy
people in all
So far, in 2001, with your participation and support we
have:
-
continued to build our management team
-
nearly completed building our
core Raleo Design™ production team
-
begun the first early thinning
of our 1993 teak
-
bought a 12 acre parcel for our
new lumber-drying facility and begun construction of 25 additional solar
dryers
-
completed the first of four
additional thin-kerf bandmills
-
hosted a group of students from
Purdue University's wood technology department, who built 50 sets of
elementary school desks and chairs to donate to our neighboring schools
-
moved our Raleo Design™ production to San José
-
nearly completed our research
of the wood furniture, surfaces, and accessories market in the U.S.
-
added more employment
opportunities, now providing jobs for more than 300 men and women here in
Costa Rica
We have completed our first, early
thinning of the 1992 teak and 1993 idigbo, removing the smallest and least
desirable trees, and leaving the best trees to continue their wonderful growth.
We have completed milling all of the trees thinned and the lumber volume
has exceeded all of our expectations.
The whole first thinning produced more
than 200,000 board feet of lumber, which is now in the final stages of drying.
We are now in the process of our first,
early thinning of the 1993 teak, and the lumber yields are again ahead of our
earlier expectations. And we will
shortly begin thinning the additional species that Leonardo has designated.
We recently mailed out post-thinning
reports to all of you who own 1992 teak and 1993 idigbo, after we had felled
your trees and carefully milled and measured your lumber, listing the exact
number of board feet of lumber from your thinning and the valuation of the
lumber.
We sent a similar post-thinning report
to all of you who sent early permission to thin your 1993 teak, listing the
exact number of board feet of lumber from your thinning and the valuation of
your lumber.
And for those of you who own 1993 teak
and did not send early permission to thin, we have recently sent out preliminary
pre-thinning reports with very conservative estimates of the lumber to come from
your thinning.
We encourage everyone who received a
report to return your forms telling us whether you would like us to sell your
lumber and send you the proceeds, send your lumber to you, or exchange your
lumber for credit toward additional trees.
Sherry and I always try to be
conservative in our estimates. So
we were very happy to find that because of the greater than expected lumber
yield from the first early thinnings and because of the value that Raleo Design™
can support paying for this young lumber, the post-thinning reports that we just
sent out show economic yields 30% to 50% higher than we had estimated in our
pre-thinning reports for the same trees.
On that basis, the reports we just sent
out show that the first early thinning of our 1992 teak produced a lumber value
an average of 46% higher than the lumber value that we had estimated in our
pre-thinning reports. The first
early thinning of our 1993 idigbo produced a lumber value an average of 44%
higher than we had estimated in our pre-thinning reports. And the first early thinning of our 1993 teak has so far produced a
lumber value an average of 53% higher than our calculations for the pre-thinning
reports. Our expectation is that
the balance of the 1993 thinning will be similarly ahead of our early,
pre-thinning estimates.
Once the trees are felled
and the logs are milled into lumber,
our workers remove the bark and mark each board with the
owner's initials before neatly stacking the lumber to air
dry while waiting to go into the solar dryers.
These first early thinnings are only
the first part of the first full thinning contemplated in our original projections.
We will conduct the second part of the full first thinning about two
years after this first early thinning.
Our original silvicultural plan called
for our teak to be thinned after eight growing seasons. At that time, the plan was to remove enough trees to bring each stand of
trees down to about 45% of its original density. But because of the wonderful growth of our trees, Leonardo, our forester,
recommended that we split the first full thinning into two parts, removing
approximately 40% of the trees, including an expected 15% mortality and cull
loss, in an early thinning, and the balance of the first thinning after the
ninth growing season, leaving a
remaining stand density after the ninth year of about 40 - 45% of the original
density.
In other words, the
thinning that we had originally planned for the eighth year has been divided
into two partial thinnings - this first, early thinning, and a follow-up
thinning that we will do after the ninth growing season. We expect that the same will be true with all of our teak plantings.
In fact, our objective is to be able to move the first early thinnings
even earlier for the subsequent plantings.
Because the trees that will be thinned
after the ninth growing season will be a good bit larger and yield more, and
higher quality, lumber than these first early thinnings, and because of being
able to create value for the lumber from these early thinnings through Raleo
Design™, our present
estimate is that the lumber and economic yield of this early thin together with
the ninth-year thin will be approximately equal to, or possibly greater than,
what we had originally projected for the original full eighth-year thin.
Even better news is that if the
superior lumber yield from these first early thinnings is an indicator of what
we can expect from subsequent thinnings and harvests, and we believe it is, the
economic yield from our subsequent thinnings and harvests may well exceed our
projections. That is clearly our
aim.
These early thinnings are producing so
much more lumber than we had anticipated, nearly 800,000 board feet this year,
that we have had to focus on increasing our capacity for these and even larger,
and much more valuable, harvests that will soon be coming.
In our original planning, we had known
for some time that for teak the trees we are planting should yield more than
10,000 board feet for each 100 trees planted. And we had calculated that, with more than one million trees planted of
our various species, we could look forward to producing more than 100 million
board feet of lumber over the next 25 years, with the largest quantities of
lumber coming from the later harvests, when the trees are older and larger.
We also knew that when Leonardo
recommended that, to improve our overall yield, we begin our teak thinnings
earlier than we had originally projected, he at the same time cautioned us that
the earlier thinnings would produce little or no useable lumber because we would
be removing the smallest and least desirable trees in the early thinnings.
Once we began the early thinnings we
could clearly see that Leonardo had been right, that the remaining trees and
later yield would benefit from the earlier thinning.
But we all very much underestimated the
quantity of useable lumber that would come from the early thinnings.
Our first, early thinning of the 1992
teak has produced approximately 200,000 board feet of beautiful teak. And the early thinning of the 1993 teak will produce at least
another 600,000 board feet of teak.
When we add to that the early thinnings
of our other species, it has become clear that we will soon need the capacity to
fell, mill and dry 1 million board feet per year.
Our original solar dryer that we built
on Campo Real last year is working beautifully, with an annual capacity of about
300,000 board feet. But we now know
that that is not nearly enough.
So we recently purchased a 12 acre
parcel of land along the coastal highway, convenient to all of our farms, and
are now building twenty-five additional, smaller solar dryers.
When the new dryers are finished late
next month, we will have the capacity to dry more than 1 million board feet of
lumber per year.
The four thin-kerf bandmills that we
bought last year are doing a wonderful job of efficiently milling the logs from
the thinnings into beautiful lumber. But
with the huge lumber yield from our early thinnings, and our desire to move even
earlier the first early thinnings of subsequent plantings, we need to add
additional milling capacity.
When we talked with Beto about ordering
more mills, he suggested that we make them here. He loves a challenge.
So we
gave him permission to proceed.
He carefully studied our existing
mills, including the refinements that he had made to them during this first year
of use. He ordered the steel,
pulleys and engines, and had the detailed parts machined in San Isidro. He brought in an experienced welder and they have completed
the first of four new thin-kerf mills. Beto's
idea and ingenuity have allowed us to save importation costs, and, more
important, to further improve the precision of these new mills.
When the four new mills are completed,
bringing our total to eight thin-kerf mills, we will have the capacity to mill
more than 1 million board feet of lumber per year.
Jorge and Steve discussing a detail in our new
Raleo Design™ production facility
Because Tropical American Tree Farms™
and Raleo Design™ are growing, Sherry and I have embarked on building an
enduring management team, not just because of the increased volume of work, but
also to assure continuity.
We have had the very good fortune of
being able to attract and hire Jorge Vargas to become our general manager. Jorge is essentially
our COO, but here in Costa Rica his position is referred to as general manager.
Jorge's thirteen years' experience in management, production, and
international marketing make him uniquely qualified to manage Tropical
American Tree Farms. He will oversee everything but the operation of farms.
In building his team, Jorge has brought
in Joaquin Cordero as our internal accountant, and hired Andréa Camacho as
assistant accountant. Andréa has
the unusual qualification of being both an accountant and a forestry engineer,
which gives her a unique understanding of our business.
Sherry and Jorge have hired Guiomar
Martin who is our new manager of tree owner relations. Guio is fully bilingual and very professional.
And as those of you who have already been in contact with her know, she
is also very warm and helpful.
Jorge has also hired Sylvia Granados to
be his administrative assistant, and Erika Houston as our new receptionist.
Jorge, Joaquín, Andréa, Guiomar,
Sylvia, and Erika all work out of our San José office.
We are proud, and very blessed, to have
these fine people on our team.
Sherry and I are very excited about
Raleo! What began with the idea of
producing small products from the lumber from the thinnings from our farms, is
growing into an operation that will utilize lumber from other planted sources as
well.
We have spent most of the last fifteen
months researching the furniture, accessories, and surfaces markets in the U.S.,
and have visited many of the major design centers from New York to Miami to San
Francisco and attended most of the best trade shows in the U.S..
To make sure that our decisions are
professionally based, we also have contracted with a New York market research
firm, to independently research and recommend product mix, pricing, volumes, and
channels of distribution.
We are now in our final,
decision-making stages and should begin to produce prototypes next month.
We'd love to show you designs, but
until we have established firm relationships with our retailers, we have to keep
them under wraps. But we can tell
you that you will be proud.
This has all taken longer than we had
originally thought, and has been more work than we originally estimated, but the
result will be much better, and much greater, than any of us imagined.
Our original plans were to have Raleo's
production in a facility we built for that purpose here on Campo Real. But our production requirements have quickly grown, so we have moved to a
new 10,000 square-foot production facility that we have leased in San José,
where we will be better able to attract the talented craftsmen that we will
need.
Our plan is to eventually move the
preliminary cutting back to our facility on Campo Real, and keep the final cut,
assembly, and finishing in San José. We
are now in the final process of equipping the facility and assembling a team of
talented craftsmen and cabinetmakers to craft beautiful Raleo Design™
products.
Jorge was able to attract an excellent
production manager for Raleo™, Guillermo Vargas. Guillermo has thirteen years' experience as manager of fine wood products
production.
Guillermo also has another
qualification, quality really, that Sherry and I treasure. He has worked closely for many years with Costa Rica's National
Rehabilitation Council and has trained many people with disabilities to become
excellent woodworkers and furniture makers. Guillermo fits perfectly with our mission of not only making a profit,
but at the same time, being a benefit to others.
Jorge was also able to contract with
Luis Barrantes, an industrial chemical analyst, who will have the special
responsibility of overseeing the quality control of our finishes, adhesives, and
other compounds.
We will also hire a quality control
manager for the cut, assembly, finishing and packaging operations.
A number of you have inquired about the
possibility of Raleo™ products being made available
to tree owners, and about the possibility of using your economic yield from your
thinnings toward Raleo Design™ furniture.
Our hope is to be able to do both - to
make Raleo Design™ products available to you, our tree owners, at a price a
good bit below retail, and to make it possible if you want to use your thinning
proceeds as credit toward Raleo Design™ furniture and accessories.
As soon as Raleo™
has developed its relationships with retailers, and we know our exclusivity
requirements, we will announce to you all what we are able to do.
Although Raleo™
was originally conceived as a potential market for your lumber, it is now taking
on a life of its own and has already bought and milled lumber from planted
trees as far away as plantations in northern Panama.
If you elect to have us sell your
lumber for you, we will allow Raleo™ to buy your lumber only if it can support
paying you as much or more for your lumber than the traditional wholesale
import/export lumber market. Any
time your lumber can bring more on the wholesale import/export lumber market
than Raleo™ can support paying, we will sell your lumber on the open market.
In other words, if you choose to have
us sell your lumber, we will sell it for the highest wholesale price we can
obtain.
Early last October we wrote that we
were working to buy a new farm perfect for planting our tropical hardwoods.
With your wonderful support, we were able to purchase and
plant this farm, which we have named San Gabriel after the small community
nearby.
Even before we had completed the
purchase, Beto had gotten permission from the owners to prepare the land for
planting. The day of the closing,
he and the crew of 50 workers he had brought together swung into action and over
the next several weeks carefully planted more than 100,000 trees there of ten
different species.
One day when Sherry and I were on the
San Gabriel farm reviewing the recent planting, we stopped by a spring on the
farm that has an ample flow of water year round. The spring is in a small patch of forest and as we were marveling at the
quantity of water flowing even then in the dry season, we heard sounds overhead.
As we looked up, we were amazed to see
a whole troop of the tiny endangered squirrel monkeys running through the
branches and playfully jumping from tree to tree. There were more than 30 in all.
Several
had tiny babies on their backs.
These tiny monkeys are becoming very
endangered because of the loss of their habitat. They are now so scarce that in all my 27 years of managing farms in Costa
Rica, this was the first time I had ever seen a squirrel monkey - and not just
one, but a whole troop.
Sherry and I thanked God, and thank
you, that we are able now to protect these precious monkeys, and protect and
extend their habitat.
We recently invited Beto up for a
special dinner to celebrate his having worked with us for eight years. We all marveled and thanked God at how far Tropical American
Tree Farms™ has come.
We warmly thanked Beto for his eight
years of loyalty, ingenuity, persistence and hard work. We told him that we, and all of our tree owners, sincerely appreciate all
he has accomplished and for helping to make our vision into a reality. He listened quietly, and then responded humbly "con
muchísimo gusto" - "with very much pleasure." Then he spontaneously continued, "En
realidad, muchas gracias a Ustedes y todos los dueños de árboles por mi
trabajo, la oportunidad, y todo que Ustedes hacen por nuestro país."
- "Really, thank you and all of the tree owners very much for my work, the
opportunity, and all that you are doing for our country." Beto is a blessing to work with.
Steve and Beto in the small shop on Campo Real
Beto then began to tell us about payday
earlier that same day at San Gabriel. He
kept saying "¡Qué duro! ¡Qué duro!" - How hard or difficult!
We had no idea where he was going with his story, but he had our complete
attention.
He told us that when he arrived at San
Gabriel to pay our workers, there were more than 40 other men and women waiting
there as well. They all waited
patiently for more than an hour as our workers came up, one at a time, to the
little table set out in the yard on paydays where Beto gives them their check
and his thank-you and they sign their receipt.
As Beto began to finish the payroll,
the others who had been waiting for so long began to form a long line in front
of the little table out in the yard. One
by one they came up to Beto and asked for work. Each had his own story to tell, of how he or she had been laid off from
the banana company, of little children at home, of there being no other
employment, and each asking if Beto could please give them a job. After each had explained his situation and sincerely asked
for work, Beto explained to each that we are at capacity on our two farms in the
area and he didn't have additional work. Each
person thanked Beto for considering them and told him how he could contact them
if work became available.
As he explained to each person that
there was no additional work, Beto could see that the next few waiting
immediately behind the one he was speaking with could hear him explain that we
weren't hiring any additional people right now. But, even though each knew what Beto had just responded to the person in
front, each waited his turn to come up and personally ask for work, hoping that
just by chance he or she might be the fortunate one to get a job.
Beto went on. He said that many had ridden bicycles or walked for hours to come ask for
work. One woman left home at 3:00
a.m. that morning to be at the farm by 6:00 a.m. to be one of the first to ask
for work. He said it was so
difficult because they were all good, earnest people who really wanted, and
needed, work.
He said that there are always people
wanting work but that the number has grown recently because banana prices are
down and the banana farms are laying off many workers.
The only other employer in the area is
Palma Tica, an oil-palm grower, and they aren't hiring.
We asked Beto what other alternatives
the people had and he replied that there aren't other employers in the area
other than the banana farms, Palma Tica, and us. He added that there may be some public assistance, but that here people
prefer to work and be productive.
We told him to please see if he
couldn't find some additional work that would justify hiring a few additional
workers at Las Lomas or San Gabriel, our two farms in that area, or even our
other farms if the prospective workers were willing to move. Beto was very happy that we were willing to try to help.
He promptly thought of a few more things that he could put a few more
workers to work.
With your continued support, we now
employ more than 300 wonderful men and women on the farms, in the Raleo™
shop, and in our offices.
Sherry and I both want you to know the
great contribution you are making here in Costa Rica.
We want to tell you one more small
story to convey how your having us grow trees improves people's lives here.
As Beto began the early thinning of the
1993 teak, he again began to exclaim about the quantity of lumber, just as he
had about our first thinning of the 1992 teak. He took us to a three-acre area on our Santo Domingo farm that he had had
prepared to stack the lumber from the trees he was thinning. The three acres were rapidly filling with new, beautiful
young teak lumber. It was obvious
that we needed more space, and we would need much more drying capacity than the
large dryer we had built on Campo Real.
We asked Beto to search for a parcel
along the coastal road between Quepos and Dominical, an area central to a number
of our farms. He found a farmer who
was willing to sell us 12 flat acres along the road. Right next to the parcel is a humble home that also serves as
the local church. The pastor is an
industrious soul, who in addition to his higher calling, during the week offers
much-needed tire repair along that stretch of the road.
When Beto mentioned to us that the
farmer might be willing to sell that piece of ground, it seemed ideal except
that Sherry and I were concerned that all of the activity of a drying yard might
disturb the pastor and his family. So
we stopped by to talk with our possible new neighbor and walk the parcel.
When we neared the area and slowed to
look at the parcel from the road, the pastor happened to be outside in front of
his house. He motioned for us to
pull into his driveway and to park in his shed so our car would be out of the
heat of the sun. As we got out of
our car, he introduced himself. Wilbur
Delgado.
Wilbur had already heard of our plans
and immediately allayed our as yet unspoken concern by thanking us profusely for
bringing employment to the area. To
make sure he wasn't just being polite, we asked if he felt we would be bothering
him or his family. He replied that
not only will we not be bothering anyone, we would be very much helping the
area.
Sherry and I both knew right then that,
unless we found a problem with the parcel, we would proceed. We thanked Wilbur for his kindness, and left his home to walk the 12
acres.
As we walked, I commented to Sherry
that pretty soon there would be a soda, a small restaurant, across the road,
offering meals to our workers. From
what we have seen each time we have begun to work on a new farm, we knew that
that little area would begin to transform.
We bought the parcel and Beto
immediately sprung into action. He
contracted a power shovel to dig a 6-foot drainage ditch along all four edges of
the parcel to keep it dry in case of heavy rains. At the same time, he began to have lumber from the Santo Domingo thinning
hauled and stacked there, and began building the first of the new solar dryers.
A few days later, Sherry and I stopped
back. It happened to be at one of
the several 15-minute breaks that our workers have throughout the day. Sherry noticed a little girl wearing a pretty dress and carrying a paper
bag appear among the workers, and a man with a familiar face right behind her,
carrying a cooler on his shoulder. Wilbur
and his daughter were quietly walking among our resting workers, offering for a
few colones something cold to drink and a tasty morsel from their kitchen.
A saying in Costa Rica is that everyone
here is an entrepreneur, and it surely seems to be true. Even out in rural areas, industrious people are always looking for
opportunities.
Today, a few months later, the area is
bustling with activity. Beto now
has 42 workers there, 20 building the solar dryers and worker housing, and
another 22 unloading trucks, marking boards, stripping bark, and stacking the
lumber - all where there had been no employment just a short time before.
Across the road, a new soda has sprung
up. And Wilbur has erected a kiosk
at the corner of his lot. Both are
offering meals and refreshments to our workers and to the drivers of the trucks
delivering the freshly cut lumber, and the materials for the dryers and housing.
It is a scene we have seen unfold many
times over these last ten years, and it constantly warms our hearts. We thank all of you for bringing so much opportunity to these
wonderful people.
Please note that we have chosen a new
courier, Interlink, to more quickly move our mail to and from North America.
Interlink is the courier service used by Intel and a number of other
larger international companies here in Costa Rica. So, for mail from the U.S. and Canada, please use the following new
address:
-
Tropical American Tree Farms
- c/o Interlink 1238
- P.O. Box 669435
- Miami, FL 33166
It is still completely fine to use
domestic U.S. postage.
Sherry and I are excited to let you
know that we will be in Anaheim in early August for the AWFS Woodworking
Machinery & Furniture Supply trade show.
AWFS is the largest U.S. exposition
this year for the woodworking industry, with more than 800 companies exhibiting
in this year's show, in over 400,000 square feet of display area.
AWFS will be held at the Anaheim Convention Center located at
800 W. Katella in Anaheim, California. The
show is Thursday, Friday, Saturday and Sunday, August 2 through August 5. We will be exhibiting in booth 3965 in Hall A.
The AWFS show hours are:
-
Thursday 10:00 a.m. 6:00 p.m.
-
Friday
10:00 a.m. 6:00 p.m.
-
Saturday 10:00 a.m. 6:00 p.m.
-
Sunday 10:00 a.m. 4:00 p.m.
If you are able to attend AWFS, we
invite you to stop by our booth. We
would love to see you and say hello. Sherry
and I will be bringing samples of many of the species of beautiful tropical
hardwoods we are growing. We will
also be available to answer any questions you may have.
If you would like to read more about
AWFS 2001 we invite you to visit their website at www.woodworkingfair.org
Fine Woodworking, an excellent magazine
for woodworkers and the woodworking trade, has recently published a brief, but
very kind article about Tropical American Tree Farms™ in their June 2001
issue. If you have an opportunity to see Fine Woodworking's June issue,
our article is on page 22, under "Wood webs" by Mark Schofield.
Steve holding one of our workers' babies
at our Tropical American Tree Farms Christmas party
Sherry and I are always touched by the
many warm and thoughtful notes and e-mails we receive, thanking us for our work,
for helping the environment, for being an example for others, for providing
employment, for our stewardship, for making a difference.
Even though the notes and messages are
addressed to us, the thank you's, and the gratitude, belong to you, our tree
owners, who make everything in this newsletter, and so much more, possible.
From us, from everyone who has thanked us, from all of our workers, from
everyone whose lives have been improved by your participation, we sincerely
thank you for your faith and support. And
to those of you who have written, we thank you all very much for your warmth and
inspiration!
Thank You!!!
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