Trip ReportSOFTWOOD EXPORT COUNCIL MISSION TO CHILE

EDIFICA 2017Santiago, Chile

October 2nd to 7th 2017M17GX-C47GB

A. Travelers

Name    Company      

Brooks Dame   Woodgrain Millwork  Craig Young   TLC Mouldings    David Stallcop   Universal Forest Products   Iain Macdonald   Oregon State University  Cal Larson   FTI America    

Tania Vasavilbaso  Softwood Export Council - Mexico  

Dana Shannon  Oregon State University    

Kellie Schroeder   Moulding & Millwork Producers AssnDacia Foster   Softwood Export Council  René Herrera   Wood-Traders International  Nick Herrera   Wood-Traders International  

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B. Purpose of Travel and Constraint/Opportunity Addressed

To participate in EDIFICA, one of the most prominent construction industry trade shows in South America. www.edifica.cl

C. Itinerary 

Date Activities Time Location ParticipantsOctober 1-3 Members of (*) 

delegation arrive in Santiago at the airport, located 22.9 km away from the hotel.Check- in at the Radisson.

  

        

Hotel Radisson Ciudad Empresarial 

October 3rd  PUCVFirst US-Chile Wood Construction Symposium Presentations:-Iain Macdonald Oregon State University

-David Stallcop Universal Forest Products 

8:30-13:00   PUCV- P. Univ. Católica de Valparaiso,Antonio Bellet 314, Providencia,Santiago. .

All members 

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PRESENTATIONS AT PUCV OCT 3RD 2017: FIRST US-CHILE WOOD CONSTRUCTION SYMPOSIUM

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Speakers and some attendees

The Audience 

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Presentation Eng. Mario Yañez, Tecnofast. Currently building the tallest wood building in South America using US Southern Yellow Pine

Date Activities Time Location ParticipantsOctober 

4thEDIFICA 

inauguration 10:00 EDIFICA

Stand Nª 1116-E2 and 1112-E2 International Area

All members of the delegation

SOFTWOOD EXPORT COUNCIL DELEGATION AT EDIFICA’S BOOTH

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DIRECTORS OF AOA-ARCHITECTURAL ASSOCIATION AT SEC’S BOOTH IN SANTIAGO 

Date Activities Time Location Participants October 

4th Construction Chamber 

Innovation and 

Productivity Seminar 

14:45 VIP Room, EDIFICA, Main Building

Meeting with Construction Chamber authorities and other speakers prior 

to the Seminar start.

Dacia Foster

Iain Macdonald

David Stallcop

Enrique Escobar 

October 

4thPresentation Iain +David

Innovation and 

Productivity Seminar

15:00-18:00

Details at: http://www.edifica.cl/actividades.php

Dacia Foster

Iain Macdonald

David Stallcop

Enrique Escobar 

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Introduction. Use of US Douglas Fir in Chile in the last two centuries

Presentation: Innovation with US Woods. Mr.  David Stallcop 

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Presentation TALLWOOD DESIGN INSTITUTE. Prof. Iain Macdonald 

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SEC’S EDIFICA BROCHURE

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Date Activities Time Location ParticipantsOctober 5th Presentation 

EDIFICA11:00 Iain 13:00 David

Conference open Room located at the Northwest corner of Pavilion Nª 2.

Iain David Enrique Interpreter 

Presentation at EDIFICA, Mr. David Stallcop, Oct. 4th

Date Activities Time location Participants October 8th  Booth 

Dismantling.

Transportation and storage of SEC exhibitors and promotional material 

Afternoon EDIFICA Design Agency

Enrique

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Booth Design Detailed View

SEC’S WOOD EXHIBITORS INSTALLED ON A PERMAMENT BASIS AT THE HEADQUARTERS OF THE ASSOCIATION OF ARCHITECTS OF CHILE –AOA

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http://latercera.pressreader.com/la-tercera-m%C3%A1s-deco/Interview Iain Macdonald, MASDECO. Saturday 25th 2017

Estimated circulation: 160,000 copies 

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D. Summary and Observations

Economic summary of the region

Although its economy size and population are significantly lower than the one of other Latin American nations, Chile has been ranked as a high-income economy by the World Bank and is considered one of South America's most stable and prosperous nations.

It leads Latin American nations in competitiveness, income per capita, globalization, economic freedom, and low perception of corruption. 

Chile is an open economy with a Free Trade Agreement with the USA and with many other nations, including China. Mexico and Canada.Quick Facts: (Source: The Heritage Foundation) 

Population: 17.8 million  GDP Growth (Current):  1.8%  Per capita GDP:  USD 22,971  Unemployment: 6.4%  Inflation: 4.4% 

American   products   are,   usually,   favorably   perceived   as   of   good   quality   by   the   Chilean   end   user. However, American Companies as renowned as JC Penney, Sears and Home Depot have not succeeded in this market.

The Chilean wood market local competition is intense, from two world-class companies. Each of these forest-harvesting firms owns one third of the country’s Radiata pine plantations. They were ranked by risk analysts in the last subprime crisis among the best positioned companies in the industry to weather the storm, on a global basis. 

The quality of sawn timber sold in the marketplace in Chile is certainly lower than the one of the US, with   low   prices.   The   market   does   not   demand,   yet,   a   better   product.   This   could   change   as   the consequence of new quality and labeling regulations that will be introduced next year by the Chilean Ministry of Housing, what will be a matter of Presidential Decree. 

Currently, US woods are being used to build ambitious multi-storey wood buildings. This shows and proves that there are customer willing to use products of a higher quality standard.

History and description of the event

The Chilean Chamber of Construction is a trade association that gathers different players  from the industry with the aim of developing  and promoting  the construction activity in our country. 

Since 1990, it has promoted the realization of Expo Edifica, International Exhibition that has become the most prominent meeting point for suppliers and buyers of the Chilean construction industry.  

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Expo Edifica 2017, in its twentieth version, not only constitutes a significant venue for commercial exchange, but also makes a  major  contribution in the incorporation of technological innovations presented by national and international exhibitors, allowing an increase in the productivity.

Source. http://www.edifica.cl/download/folleto-2017-fic.pdf

Reception summary, if relevant

There were three “receptions” during the week.-

a) PUCV (Pontificia Universidad Católica de Valparaíso) US-Chile  Wood Construction Symposium. It gathered 74 participants (Detailed List included in Appendix File). The University offered SEC a facility located in the heart of the city (Please see enclosed picture and video):  https://www.youtube.com/watch?v=hXn5SZdgfOg

Besides SEC’s speakers, representatives of three local Universities and of the Ministry of Public Infrastructure also presented their applied research and projects in the use of wood in construction. In addition, the company TECNOFAST presented its project of a wood building of six floors, using US Southern Yellow Pine, currently under construction. It is becoming the tallest wood-based building in South America. 

b) Presentation at the Innovation and Productivity Symposium organized by the Chilean Construction Chamber at EDIFICA. Details at : http://www.softwood.org/news/edifica-presentations

SEC was the only wood industry associated with the local construction industry at EDIFICA, working along with the Chilean Construction Chamber at the event.  SEC’s presentations at the Symposium were preceded by the one of a former Minister of Public Infrastructure. 

c) Reception of visitors at the booth and technical presentations given at a venue adjacent to the booth. Among assorted visitors, there were importers, architects as well as the members of the Board of the Chilean Architectural Association. Our wood displays were installed in their facilities with our catalogues at the end of the Fair.  

Trade show (EDIFICA)

Statistics including total number of exhibitors, products featuredDemographics of attendeesAdditional trade servicing observations

35,000 square METERS Of Exhibition 500 EXHIBITING COMPANIES Construction materials and equipment About 40,000 professional visitors: Civil Engineers, Architects, Designers, Civil Constructors, 

Technicians and others. 

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E. Names of Principal Contacts

Please find enclosed list of visitors to SEC’s booth (30)

F. Conclusions and Recommendations

Describe market in the region as a whole

The wood industry is a cornerstone of the Chilean economy. It produces a wide range of boards of good quality with a significant export surplus. The Chilean forest sector represents 2.5% of its GDP.Traditionally, the local construction industry has been intensive in concrete, masonry and steel. Wood, as a structural material, represents about 18% of the residential construction market. The availability of wood in the South and influence of German immigrants have led to a concentration of wood construction practices in the Southern the country. The outstanding marketing efforts of Louisiana Pacific in Chile have positioned throughout the last decade the so-called dry-construction (Wood-Frame and Steel-Frame) at around 30% of the market1.

Of the Chilean wood industry sawn timber output (7,998,781 m3, 2014), 3,583,096 m3 of sawn timber remains in the domestic market.   In addition to that volume, 7, 731 m3 are imported (Both figures for year 2014, according to INFOR) with a net domestic market of 3.590.827 m3/year. This is mostly Radiata Pine (98.6%)2

Only 40% of this volume: 1.425.780 m3 is sold as construction wood through retail stores. The   rest   is   sold   to   the   pallet   &   bins   industry,   furniture   manufacturers,   construction companies and end-users directly by sawmills.

Explain how market has changed over time

Recent imports of timber skyrocketed through the commercial actions of one company: TECNOFAST.   

The Chilean forest industry exports 2,881,796 m3 /year of wood (2014)

Although there are no statistics available regarding market shares, it is widely assumed in the marketplace that CMPC AND ARAUCO holds 1/3 of   the market,  while  the remaining 1/3  is 

1 Source: Reports of Catholic University, Interviews with former executives of LP-Chile and Reports of CORMA, Chilean Wood Association

2 Source ; INFOR Reports. 2015, Chile

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controlled  by   smaller  producers.   These   smaller  producers   created  an   industrial   association called PYMEMAD that has gained significant influence within government authorities. The large producers are represented by an Industrial Association named CORMA.

Within the coming year, the Ministry of Housing is to about to enforce the use of standardized labeling systems in wood. The Decree is about to be submitted to Presidential signature soon. This will be a requirement in all government purchasing processes. The stamp will be similar to the one currently used in the US market. It will certainly be applicable to all structural wood and, possibly to non-structural as well. According to government sources, there is no doubt that it will be applied to structural wood. Its extension to non-structural wood is still a matter of debate at the Ministry of Housing. Small sawmills are opposing the enactment of this new regulation, through PYMEMAD.

The significant fires that have decimated significant plantation areas, will lead to a shortage in Chilean woods suitable for construction purposes, within the next decade.

Use of US softwoods. Species specific? Where are they getting their materials currently?

Materials are being provided locally by the already mentioned companies. 

TECNOFAST is importing Southern Yellow Pine from the US .Maderas Venturelli is importing softwoods from Canada. Their interest is focused in Douglas Fir or other species

How did this event alter the situation in the region?

This event has created awareness of the availability of good quality US woods in the Chilean construction industry.

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What needs to be done in the future?

The World Conference on Timber Engineering 2020 will take place in Chile. http://wcte2020.com/index.html . This entails an opportunity to participate with presentations in partnership with companies like Tecnofast, in order to position US woods as a Multi-Storey structural solution.

To establish a distributor: One of the six major retailers (MTS, Sodimac, Chilemat, Construmart, Imperial).

To appoint a sales agent in the region.

To participate in EDIFICA 2019.

To support Universities, including US Softwoods standards in the curriculum of engineers and architects. Specifically: Universidad de Santiago, Universidad de Concepción, Pontificia Universidad Católica de Valparaiso and Universidad Federico Santa Maria. These are major institutions with solid connections with the Ministry of Public Infrastructure, strong wood expertise and vocation, with almost no support from the local forest industry.

To persevere on the relationship with AOA, Association of Architects.

To consider the enacting of a US woods architectural contest for students with the sponsorship of AOA.

To support wood bridges research at Universidad de Concepcion. They have a strong potential to position Douglas Fir.

To develop a video describing the almost unknown and very remarkable use of US softwoods in Chile in the last two centuries. Please visit: https://www.linkedin.com/pulse/american-douglas-fir-origin-chilean-wood-architecture-enrique/?trackingId=xoUv0EaAjupPwv9VQnw9Lg%3D%3D

To participate in EDIFICA 2019 EDIFICA 2019.

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