Negotiations between the University of Alaska Land office and a Chinese buyer ground to a halt this month as a result of an escalating trade war between the U.S. and China. The sale is on hold until there is a change in tariffs.
Morgan Howard from the University of Alaska Land Management Office says the potential buyer is still interested in a timber contract. But not right now.
Tariffs on American timber headed to China have put the University’s negotiations on hold.
“The potential bidder for the timber sale does not see this time as a good time to engage with the tariffs being as high as they are,” said Howard.
“So we’ll see what happens in the future, but we don’t see negotiations resuming until there is a change in the tariffs.”
The current tariff on spruce logs exported to China is 25 percent. Howard says they are still looking at infrastructure, permitting and potential markets for the spruce and hemlock on 13,000 acres of University land around Haines.
Conservation groups want to keep the forests standing. So the clash between the Trump administration and China is working in their favor.
“It’s amusing to say the least,” said Jessica Plachta, the director of Lynn Canal Conservation.
She is opposed to the sale because of logging’s ecological impact, especially to wildlife and subsistence resources. She says from an economic standpoint, the University could actually make more money trading their trees on the carbon market than cutting them down.
“The carbon credit market is turning out to be more reliable than global export, for timber,” she said.
The University timber sale could make about $10 million over ten years– if tariffs go down. A study put together by Takshanuk Watershed Council, another local conservation group, says a carbon sale of the university’s land could earn millions up front, followed by yearly earnings in the hundreds of thousands of dollars after that.
Those earnings would not be affected by tariffs. In fact, Plachta predicts the value will only go up as the need for carbon sequestration increases.
“If it was me, I would say, ‘Let’s see less effort. More money. Right?”
Carbon credits are something the University Land Office is considering. Howard says they are still in the early stages of conversation on the subject, and it hasn’t been ruled out for the land near Haines. But he hasn’t given up hope that a regional timber industry could thrive.
“Initially, there was a vision for the Chilkat Valley that all of the landowners would work together in regard to harvesting timber,” he said.
“If they all work together, then they could be a long term timber industry put into place.”
That vision is on hold until trade conditions improve.