Michigan boosting wood export effort

January 25, 2010
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LANSING — A 40-foot crate is packed with northern Michigan white cedar panels and siding ready to be shipped to Korea by Boyne Falls-based Town & Country Cedar Products.

The company started exporting a year ago to expand its customer base after economic downturns forced the industry to “look at changing the way they do business in order to survive,” said national sales manager Mike Rathbun.

He added that strong personal business relationships are important for international marketing. They take time to cultivate, but once they’re established, buyers are loyal to sellers as long as they are reasonable.

The company exports to Korea, Japan, Canada, the Cayman Islands and Turkey, and wants to expand exporting from 2 to 3 percent of its business to 20 percent, said Rathbun.

Kevin Korpi, executive director of the Michigan Forest Products Council, said exports by Michigan’s forestry sector are growing. He said economists generally attribute that trend to the growth of middle-class consumers around the world.

Thomas McGuire, director of commerce for the U.S. Commercial Service office in Grand Rapids, said a lot of raw Michigan products like wood are shipped abroad and used to make furniture, flooring, car paneling and decorative wood veneer.

There is a big demand for wood grown in Michigan for building projects abroad, too, said McGuire. Michigan hardwood is used for buildings such as ski lodges, sports arenas and homes, he said. Rathbun said that Town & Country products are being used to build the national soccer arena in Turkey.

The U.S. Commercial Service is a part of the U.S. Department of Commerce and has offices in Detroit, Pontiac and Grand Rapids. Each office works with client companies to develop their products for foreign markets, said McGuire.

Rathbun said the U.S. Commercial Service is helpful in setting up meetings with foreign buyers and interpreters and navigating other challenges of the international market system.

The Department of Agriculture’s branding program also assists companies by offering subsidies for marketing and advertising internationally, said Jaime Zmitko-Somers, international marketing manager.

Not all products are marketable in foreign markets, McGuire said, but “there are not enough Michigan companies exporting that could or should be doing so.”

McGuire said American products are doing well in foreign markets because of current exchange rates. “Internationally, people can buy American products so inexpensively, and it’s a huge advantage to American exporters.

“America is a huge department store, so they gravitate to us. Then comes the challenge of matching buyers and sellers up,” which is where the U.S. Commercial Service comes in.

“The world is our market, and the landed cost for a product in the foreign market is very competitive, so we must take advantage of this,” McGuire added.

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