Odd Lots - The White Oak Shortage That Could Ruin the Bourbon Industry

Episode Date: May 1, 2023

Some supply chain crises are acute. A bottleneck at the ports. A shortage of semiconductors. These can get fixed, to some extent, with concerted policy choices. But other crises are slower moving and don't have one easy fix. In the coming years, the bourbon supply chain could be under threat, due to a shortage of the specific type of wood used in the barrels made for aging the liquor. On this episode of the podcast, we speak with Penn State University forestry professor Calvin Norman about a looming shortage of critical white oak. He explains why the industry is potentially facing a shortfall, why other woods can’t be used to replace it, and what it would take to ensure that this critical tree remains abundant.See omnystudio.com/listener for privacy information.

Thanks for listening to Odd Lots. Follow the show on Amazon Music for more future episodes or just ask, Alexa, play the Odd Lots podcast on Amazon Music. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day. But on Vanguard, at Vanguard, institutional quality isn't a tagline. It's a big line. It's a very big. It's a firm. It's a few. commitment to your clients. We're talking top grade products across the board of over 80 bond funds, actively managed by a 200-person global squad of sector specialists, analysts, and traders. These folks live and breathe fixed income. So if you're looking to give your clients consistent results year in and year out, go see the record for yourself at vanguard.com slash audio. That's vanguard.com

all investing is subject to risk vanguard marketing corporation distributor. Hello and welcome to another episode of the Odd Lots podcast. I'm Joe Wisenthall. And I'm Tracy Alawite. Tracy in a new studio today. I know. Isn't it great? If you're just listening to the podcast on the audio, I guess nothing has changed.

But if you're checking it out on video, on YouTube, on Quick Take, etc. Streaming, it looks different. You should check it out. Yeah, for sure. I think we're leaning into the sort of 90s, Nickelodeon Spongebob vibe, maybe. That is a very interesting. I like that aesthetic a lot. After school special.

This is an after school special. Except today's topic is not like really, well, kind of is. It's kind of an after school special vibe because today we're going to be talking about alcohol. Yes. Okay. But not just alcohol. We're doing a supply chain episode. Classic odd lot supply chain episode.

Yes. And so, you know, have we ever talked about the alcohol industry before? I don't think we have. I don't think we have either, but, you know, like one, it's one of those things where it's like, okay, like you go, you ask for a drink, et cetera. And you probably do not think too much unless you're like a true connoisseur of something about what it took to get there. Yeah, I think that's right. And I mean, to be fair, that is the case with almost all the supply chain episodes that we do, which is people use these final products and goods. They don't always necessarily realize what goes into them until something happens.

there's a disruption of some sort, and then suddenly everyone realizes, oh, actually, you need this component in order to make this thing that I really like. The other thing that I've been thinking a lot about with respect to supply chains is that there seem to be some issues that arise that I don't know if mechanical is the right word, but where it's like you can change something and maybe fixing it. Like capacity at the ports, for example. Like in theory, that seems like a sort of like human solvable problem, whereas we talk about other issues that arise in which we're sort of like dependent on natural phenomenon or at the

mercy of natural phenomenon, such as drought and say the level of the water level of the Mississippi River, like there is very little that like humans can do certainly in a short period of time to sort of like make water levels higher when that becomes a problem. Yeah. And I think for this episode, the time frame is really key. And if I think back to an episode that is perhaps most relevant to what we're about to discuss, it's some of the ones we did with Stinson Dean, where we talked about lumber supply and just how long it takes to actually grow the trees that we use for all sorts of things from, you know, housing construction being the most important one.

Well, and so there is this supply chain tension that maybe we're going to see within alcohol, specifically the world of bourbon, and there are many aspects of it that are just slow-moving, particularly barrels building them or the trees required to, you know, make the barrels, the aging process, et cetera. It's sort of like this slow-moving supply chain that probably many people don't really think about, but there could be issues in the future, at least according to our guest who will have on in this. Right. A slow-moving supply chain crisis is the theme of this particular episode.

But I think it is true that when you think about bourbon, most people think bourbon, oh, it comes from corn and, you know, fermenting corn. Not everyone immediately thinks about the barrels that it's aged in and where those actually come from. Are you a bourbon fan, by the way? No, I'm the worst alcohol drinker. I drink almost exclusively light beer. I try to get into like dark, like sort of like brown, like heavy alcohol, like, I don't know, like once every few years, like, because I think it would be nice or relaxing, hasn't happened yet. But I am aware, and I respect people for whom that is like, you know, I'm aware that that's a popular. Maybe this will give us both a newfound appreciation for

bourbon. Exactly. All right. Well, I am very excited about our guest. We are going to be speaking with Calvin Norman. He is an assistant teaching professor of forestry at Penn State. And he says there is a looming under the radar supply chain. Maybe crisis is the right word problem coming for the bourbon industry, thanks to the wood that's needed for the barrels. So we're going to learn about something. You know what I'm excited about too? This is not like a crisis in the public view yet. So maybe we can like help get ahead of something and maybe it'll never become a crisis as opposed to saying like, oh, how did this happen? A bunch of people are going to plant trees because of this episode. Let's hope so. All right. Kelvin, thank you so much for coming on Odd Lots. Thank you for having me out. I'm super excited to talk about trees.

I love talking about trees. This is an after-school special. I would hope that an assistant teaching professor of forestry likes to talk about trees, but I am excited about talking trees as well. Well, let's just start with like, can you explain the role of the barrel specifically within the bourbon making process? Yeah. So this is where it gets really fun. So bourbon is an American liquor.

It's like our true native liquor. It's 51% corn that's distilled three times and put into barrels at 80 proof. And then it has to sit in white oak once used, once charred white oak barrels for a couple of years. The reason you have to use white oak, you can use a lot of wood to make barrels. It's a really old art. But it has to sit for a couple of years. So you have to use white oak because white oak, you know, wood. you know, wood fibers are just like long straws.

And if you put liquids in those straws, you can actually drink through the straws. You know, when you're doing your forester degree, we do this really fun thing where you drink water through white oak and red oak. So red oak works just like a straw. Really fun, kind of nerdy. But if you try to use white oak as a straw, it doesn't work. Because white oak has these little bubbles in the wood that just develop after the tree is done

using those straws to move water up and down the tree. and so those bubbles prevent liquid from escaping from the barrel itself, which is really handy when you're trying to age something for like 10 or 12 years, or three or four years. So there are only three woods that you can really use to make barrels that age things for a long time. There's French oak, Hungarian oak, and white oak. If you want to get Botanicals Quircus Alba, for those of you following along at home. Thank you.

So we use white oak here in America. You legally have to use it, and you can only... only use that barrel once. After they use the bourbon barrel, they usually sell it off to other liquor distillers because these barrels are expensive and very good. This is already one of those episodes that I can tell is going to produce a lot of facts that I'm going to mention at parties and be very popular, like, you know, sort of like just bringing up random things to people from that. Just randomly saying corcus alba all the time. Okay, well, on that note, White Oak has this special property that you were just describing. What's the actual distribution of White Oak in a

America. Like, how common is it? Um, so it depends on where you are. So white oak is an eastern U.S. species. So you can find it from like New England, kind of Connecticut area, all the way over to Minnesota, down to Tennessee and Florida. But to make a barrel, and this is, this is going to sound really silly. You have to have a really high quality piece of wood. If you have a branch or a hole in that barrel, it's not going to make a good barrel. So you need really high quality white oak. So we really only get, we call them stave quality, because that's the piece of wood you use to make a barrel is a stave. You only get

stave quality wood from like New York down into Georgia. I've heard of staves coming from like southern Minnesota but like not really. So you're looking really central like the apps, the Appalachians. Just a real quick question before a longer question, but you mentioned

like how much is a barrel? Like if I wanted to just the wood itself. How much is that? That is a really great question and I can't get that information out of barrel makers. I can tell you, if you try to buy it, there's a distillerator to me, and they will sell use barrels for like 120 bucks. So I couldn't tell you what a barrel costs right off the block. Coopridge, you know, or making barrels, it's like a, it's like a dark art.

You know, they have a lot of secrets. Every coopridge does their, you know, barrel making a little bit differently. You know, they age wood differently for various distillers. So some distillers, one. This is a market structure episode. Yeah. We got to get a coop. around next time. Oh, there's not many of them. There's not many of them. But you can find them. Why should we be concerned about the supply of white oak?

Okay, so we have one tree. We have one tree species. Technically a commodity, but unlike, you know, pine lumber, it's not, you know, spruce and fur are not interchangeable. You can only get it from white oak. And white oak has very specific growing requirements. And we're looking for the superstar white oak. So you have to have white oak on good sites.

growing well. And we have a lot right now, but when we look to the next generation of white oak, there's very little. We're looking at like a 77% population decline if nothing changes today. If we take all of our seedling and saplings or our little oaks that we have on the ground, when we put those up in the overstory, 77% of the trees that we have today aren't going to be, you know, population decline. So maybe just to back up, to illustrate that point, can you walk us through the process of where a barrel actually comes from. So who owns the white oak trees? When do they decide to cut them down? And then how does that whole process of creating the barrel actually happen? Yeah. So Tracy, follow me in this one. What can you say about an acorn? It's small, but it grows a

large tree. Yeah, in a nutshell, it's an oak tree. So we don't get a lot of forestry. We don't get a lot of forester jokes, but they grow on you slowly. So, um, that was good too. I try. Um, so you start with to start with a white oak. We got to go back like a hundred years. You start with an acorn or a stump sprout from a tree. Slowly that recruits. So it grows from an acorn into a sapling, into a pole size tree, into a state of quality tree. That takes a hundred years and you have incredible mortality. So we have, we'll start with like a couple of thousand seedlings and will end with like 200 trees.

And those trees are there for a long time. So the odds of a tree becoming or a seedling and acorn becoming a tree super low. And then to become a barrel, so if you have a forest of really wonderful white oak, there's a stave buyer. It's one person for the mill. They'll go around. Some of them even have specific counties and like specific areas that they know good wood comes from because you're looking for super quality trees.

like we're again we're talking the NFL of trees it's got to be super straight there can't be any turn in that tree at all wow um so they'll go around they'll cruise the entire stand looking for trees that they want they'll select those trees and then when a harvest comes through those trees get treated differently and they get taken out and sent right to the stave mill sometimes they'll get cut up at a sawmill and the stave mill buys them there but usually they're out there they're picking trees on wood lots today's show is brought to you by vanguard to all the financial advisors Let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day.

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by Sauton Canada. So, right now we have plenty of white oak and there's not an acute

crisis, but it's your projection. In terms of the sort of acreage, the volume of these

white oak trees right now, how much was that, I don't know if the word was like planned or active

decisions that were made decades and decades and decades in the past versus sort of like a more emergent phenomenon and we're blessed with something that was sort of sort of emerged over time but that now at this point needs more active management. Joe, it's a great question. It's a really fun discussion that we have at the bar after forestry conferences. So we have a glut of white oak right now, you know, following farm abandonment in the Great Depression. For those of you who are not foresters, when you're a forest, you have to think really long term because what you're doing today impacts the landscape for the next hundred years.

So when we look back 100 years, so we're looking at Great Depression is when most of these forests start. You get farm field abandonment. White Oak really likes that sun and the semi-shade that came with that, as well as back in the 20s, people ran, you know, they did a lot of fire. They're out there cutting down trees. And we had this like dappled shade condition that was really great for White Oak. So I would say we're probably, you know, the amount of white oak that we had today is probably a little bit extra than we would expect. But the decline that we're seeing is not a result of, you know, if there was just too much, it's the management has changed and we're not managing it correctly to get that whiteout back. So it's not totally an emergent

phenomenon, but it sounds like it came from things that were not necessarily intentional, but in a way we owe this abundance to the Great Depression. Yeah. And then we also have to look back even farther back because, you know, this continent has been peopled for a couple of, you know, thousands and thousands of years. And so those peoples managed this landscape for a really long time using fire and harvesting timber and deer and all kinds of stuff. And they helped, you know, they liked White Oak, because White Oak has a tasty acorn if you like to eat acorns. I'm not a huge fan of it. I think it's kind of a cultural thing. But, you know, the peoples who lived here before Europeans liked White Oak and they managed landscapes for White Oak and those, the trees in the white oak.

family. And so they help shape the landscape and the trees for white, you know, to be more white oak friendly. So this is something I wanted to ask you about because this is something I learned from buying that house in Connecticut, which is a lot of those sort of eastern states used to look very park-like because Native Americans, I see you shaking your head. But, you know, like more park-like than they look now because Native Americans would burn some of the scrub and brush in order to manage the land. Talk to us. about a little bit more about that component of it. Like, what does fire actually mean to the white oak? And why has that process changed since the Great Depression? So, you know, a lot of people think

trees, trees don't like fire. Actually, it's not true. Some trees really love fire. So white oak is kind of, it's not fire dependent, which is when a tree only regenerates after a fire, but it likes fire. So what white oak does is when it grows, it starts putting nutrients down into the root system and then it grows up. a lot of other trees will just go straight up because when you're a tree you need sunlight and so to get sunlight you got to go up but white oak goes down and then it goes up so if you get a couple of fires in there

that kills out trees that can't take fire so your maples don't like fire you know kind of your ash and that kind of stuff don't like fire so you get a couple of burns through and then the white oak comes up white oak is pretty fire resistant when it gets to you know a smaller you know a smaller size so after it gets top gelled it's probably going to survive

most surface fires. And then you get these beautiful white oak stands. We, you know, recently in management have suppressed fire because we're like fire bad. Don't like fire. In the southeast, they never really stopped burning. They had a culture of burning. But here in the northeast is very difficult to get prescribed fire on the ground, which makes white oak regeneration very difficult. But there are other things that are probably there are other problems. It's not just a lack of fire in the landscape. You know, this is this is one of those, you know, all unhappy families are different in their own way and all happy families are the same. So this kind of leads to my next question, but I wanted to pick up on something that Tracy

already asked about, but further to like the current economics of this acreage, like who owns this acreage? And for them, I have to imagine like the bourbon or the Cooper, the Cooper market leading into the bourbon market, I'm assuming it's not a massive slice of like their own economics. And so can you talk a little bit about like who are these companies that sort of like own a lot of this acreage and what are they what are most of them optimizing for? Because I assume it's not optimizing for the bourbon market specifically. Yeah. So most of the land that you see United States is owned not by companies, but private landowners. So like the three of us, we represent like in Pennsylvania that's 70% of land ownership. It's just like random people in

their backyards, which is why, you know, doing, you know, very good force management is difficult. It takes money up front and then you're not going to see financial return for 100 years. So the odds of like, that's a really fun thing when you do for us. She's like, I'll never see this stand again. I'm doing this not for me, not for the person after me, but three people after me. This is kind of like, I think why endowments like, don't they like trees, like the Yale endowment? Because like, these are like assets that are really like not on typical market. cycles. Yeah, there are some large, you know, timber investment companies and real estate investment companies, Timos and Ritsa own forest land. But the East Coast has been, you know, people by Europeans

for a long time, so it's difficult to get that land. There's not a lot of it out there that large companies can buy up. And when you get into the southeast, they buy main, there's a lot of like softwood. So Southern Yellow Pine is the biggest agricultural export of the Southeast. And they grew a lot of pine down there. It's, that's very easy to manage. White Oak is difficult to manage. You have to put a lot of time, thought, and effort, and money into it. And then you see their return way down the line. So the economics from the system that we have don't make a lot of sense.

Because if you go on and you do invasive species management, which you have to do, regenerate white oak. It costs you $80 an acre today. And then you don't get to recruit that value financially for 100 years. You might get to recruit it in that you're harvesting deer or you're out there walking your dog or you and your family are having a good time on the landscape, but there's not really a financial value for that, whereas like doing the management costs money today. Yeah. So just on this note, I mean, you walked us through how the economics don't really work, but I have to imagine the

people that have the biggest stakeholders in growing white oaks should be the bourbon makers. Are bourbon makers able to do anything about this? Can they plant their own forest, for instance? Yeah, so the bourbon makers are definitely, they've definitely taken notice of this. There's a thing called the White Oak Initiative, which is a partnership of the Forest Service, you know, various state governments. They own land and the bourbon makers, coopridges, and they're helping to, you know, try to raise the profile of this issue and, you know, teach people how to manage their land correctly and, you know, for oak species. So they're taking steps. They also fund a lot of research and they're funding nurseries and their funding efforts to plant white oak out on the landscape. The problem is you can't really plant white oak, you know, just in straight lines like it's corn or southern yellow pine.

Because when you make a barrel, you need nice, tight grains, and you need competition. And when you, you know, do a plantation, you don't really get that. And they don't like plantations. So you can put them out there. You can plant them in lines and you're not really going to make barrels out of that. You need the natural region. You need a good, well-managed forest. So can you explain?

What do you mean by competition in this context? How does that work? And how does that natural form of competition create better wood? So when trees grow, I'm actually teaching my students' lesson, this lesson in like shortly. Awesome. So you have competition for sunlight. You know, trees need three main resources. They need sunlight.

They need water. They need space. And they need nutrients. The nutrients isn't really a problem. So they need that competition for sunlight. If, you know, a tree gets all the sunlight it ever wants, you have these really wide growth rings. Actually, I have a tree cookie here. So you have these are the growth rings.

If you're listening to this on the audio, you've got to watch the video because Kelvin has propped. This is awesome. Well, again, my students are going to see this in an hour. So if my students are listening to this, you already learned this lesson. But so you have these growth rings here, which is how much this tree grows every year. When they're very big, that's really good for liquid moving through it, which if you are trying to hold a product for a long time in a barrel, is bad. So you need trees that are kind of stressed, and they're

really having to compete. And so the growth is, it's good, but it's not huge. This is the opposite of, like, if we're growing, like, two-by-fourths, when we're growing two-by-forth, we want big growth, because then you can make a lot of two-by-force really fast. So you need the sort of the dappled sunlight with

some shade, basically the forest environment with lots of trees crowding in that makes them compete to grow up towards the sunlight. To what degree can you, I guess, you know, replicate that environment? Like how easy would it be to start a commercial white oak farm and just create your own little natural looking for us? Setting aside the hundred years that you have to wait for getting your financial return. I get the timeline is an issue. But, you know, if you're really motivated to try to start solving this program, this problem now,

how difficult would it be? It's not impossible. It is difficult. You do have to have. have, you know, what's why forestry is a profession. You've got to have folks you know how to manage these trees to encourage growth. This is a solvable problem. It just takes, you know, time, thought, effort, and money. So you have to be it, you have to know, physical ground, your soil and nutrients have to be right. So you have to have the right ground. And then you have to have the right trees on site already. If you don't have white oak on site, you're probably never going to grow white oak. You can plant it in, but dear love white oak. So they'll just come through and buzz down anything you plant.

So you have to have it on site. You can manage it correctly. We were just out the other day in class in a white oak stand. And there we could easily manage that forest for white oak. In stands that aren't that perfect? So you can do white oak regeneration very well in Kentucky and Missouri and the Ozarks. But then as you expand out, you run into invasive species that require management. And again, we can control those species through the application of herbicides or prescribed fire.

you know, sometimes goats work for some species. So if you can control those species, you do management with deer. Sometimes we have to fence forests now to keep deer out. It's the way the trees can grow high enough. The deer aren't a problem. So you keep the deer out, you can get white up back. It just takes, you know, effort. There's been a lot of changes to the forest.

I'm really fascinated by this point that this idea of like the best type of trees for, say, lumber for housing, which seems like it's probably, you know, a much, not seems like, a much bigger industry than barrels is very different than the optimal trees for barrels. So how much does this inherent economic tension create stress in terms of like the planning that you needed in terms of like, I don't know, I feel like the housing is a bigger market. And that's where people are going to like sort of like think about their forestry efforts. I mean, it does to some extent. So Pennsylvania, we call ourselves the, you know, we're the largest. export of hardwood in the nation, the high-value hardwood. Then if you go down to like Georgia,

they export a lot of really high-value pine. The pine species they have down here don't grow in Pennsylvania, so we don't have that competition for space because you just can't grow them. If you put them in the ground today, they'll be dead in a couple of years. They don't make it to the winter. They don't like our soil types. So, you know, there's a little bit of competition when it comes to species, but you're working with nature. You could try to fight nature, but you usually lose. So there's not a ton of competition. The problem is there's also a lack of low quality wood markets now. We used to make a lot of paper in the U.S. out of American fiber. Now it's mostly eucalyptus and bamboo. The eucalyptus comes from South America. So the really great thing about

American, you know, having the low quality market here is the trees and stuff you can't use to make, you know, high-quality products like barrels or shelves or boards, that kind of stuff. That's still, you know, the wood you can't use, that still costs money to fell and to handle. There's still risk in cutting the tree down, not like financial risk, but like it is a, it is a, you know, a several-ton tree coming down. People die. So, you know, you don't want to cut down things. You don't have to, you know, people don't want to cut down things that are risky. So, but with the, so we used to be able to sell those trees and now it's very difficult to sell low-grade.

because there's no market for it. And that makes, you know, management for things that don't make you money hard. And so there's a big pressure for the high-value trees, leaving the low-value trees behind. But when you leave the low-value trees behind, there's no second harvest.

You know, you can't come back. There's nothing to cut. Right. From an economic perspective. You have the desire to help to make a real difference? The College, LaCite, you offer the program

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podcasts. So two semi-apocalyptic questions, but one, what are the chances that in maybe not 100 years, but maybe 200 years, maybe we just don't have enough white oaks to create bourbon barrels. And then secondly, what would the bourbon industry do without those white oak barrels? Are there synthetic alternatives or is it just not possible to replicate the bourbon taste at all? Yeah. So I'll take the second one first because it's easier to answer. There's no, legally, there's no replacement.

Huh. There's no replacement. It has to be white oak. Has to be queerer salons. You could try to replace it with French oak or with Hungarian oak. You have to import those from Europe and you have similar kind of issues over there. I'm a forester who works in Pennsylvania and the Mid-Atlantic slash Northeast. I couldn't really speak to all the stuff that goes on in Europe, but I assume they're having similar issues.

So there's not a replacement. Now going to the, you know, what does the future look like? This is kind of my element. I do climate change, invasive species, and forest health stuff. So the future is not great unless we take action today. You know, looking, you know, using what we have on the ground today, you're looking at 70% decline if we don't take action today. But we can take action today and we can get that, you know, we'll see some decline

because that is probably overrepresented landscape. But if we take action and we start doing good management, we can get those numbers up. We can see white oak regeneration get up. It just takes, you know, getting out there and cutting trees, burning the forest, fencing deer, killing invasive species. Just takes action. And that's where things get fun.

If there's no action, how soon of a timeline are we talking about in which it would be not apocalypse, not the end of the industry, not the end of legal bourbon as we know it? But what is the point at which the bourbon makers would start to seriously sort of get stressed on their own supply chains and start to run into harbohroman? physical constraints about how much bourbon they can make in a year. Can I tack on a question to that, which is how long does a bourbon barrel made of white oak actually last? Like, how often can you reuse it? So if you look at the data, we're good until for the next like 20 or 30 years. We get plenty

of white oak up until that 60 age, you know, that 60 year old tree. And you cut them at about 120 years. They can live longer, but they don't really, they start to decline. We were We're really are sending the alarm in advance on this one. I'm really happy that we're amplifying this now. In 100 years, people are going to look back on this episode and say, all thoughts warned us. Well, when we talk about white oak decline, one of the main points is nobody knows about this stuff.

You know, the only people who know about this stuff, like, you know, our foresters and foresters famously don't like to talk to other people. The fun joke that we have in forestry is the social foresterer looks at the other guy's boots. So that's one of the issues. But now, Tracy, to your question, how long can you reuse that barrel? A long time. You can use it for a long time. So after it gets used in bourbon, you can only use it once to make bourbon, but you can use it to make ales and beers. You can use it to make whiskey.

They sell them to Ireland. I was in Ireland this summer on vacation, and we saw some Irish distilleries that had, you know, white oak barrels. It was really fun. I had this one fun party trick where I just identify pieces of wood around the room. And I was like, hey, I know that tree. They were like, what tree? Oh, the wood in the barrel. I know that one.

I actually grow those. So, you know, this is not going to impact just bourbon. It's going to impact a larger range of alcohol products. And then you can also use them in your home for decoration. You know, a lot of bars have bourbon barrels. I'd say, you know, the shelf life of a bourbon barrel before you throw it out is probably like 50 years. Wow. They don't really rot and they're very dry.

So it lasts until you throw it out. Huh. It's a great. This is the other really fun thing. thinking about trees. I'm sorry, I just ran you over. No, but trees are a great carbon storage, a great carbon sink. So we like to just like, yeah, wood products. I drink bourbon because it's a wood product.

And, you know, that barrel after you're done with it, that's carbon stored out of the atmosphere. Physical form, you get to put your beer on it afterwards. Okay, so the lesson is treasure your oak barrels and your white oaks as well. So I just want to go back to what when we were talking about the economics of white oak ownership. And you're saying we need more active. land management, better land management in order to grow more of these trees. But how do you actually

do that, given that a lot of the tree owners are going to be, you know, individuals who maybe have like a grove on some of their acreage? So, you know, there is some, you know, people who are looking, like, all right, I'm going to model this forward. It makes sense for me. I am bought into conservation. I like having, you know, oaks not just for, you know, the financial value, but they're really important from a habitat perspective, I got a bear back here. Bears love white oaks. That's just a little fun hat. So there's some people who model it for it. Like, it's worth it for me to pay this. But there's also programs out there. So CRP, the Conservation Reserve Program, does fund some forest conservation practices. The inflation reduction bill, the IRA has money in it now that is going to help fund

some more of these forest practices. Because, you know, good forestry is not just good the woods. It's good for the climate. It's good for society. So people are taking notice of this and like, oh, we should, we should help fund this. There are programs out there. There's a lot of programs like extension programs at local universities or land grant universities that help, like, teach people how to do forestry and will help, you know, I do. Sorry, this is a shameless plug for extension because it's what I do. But like, we go out, we give talks, we talk to people, we go, we cruise land and we tell me, here's, you know, how you can do stuff, you know, here's things that you could do in the future. So there's a lot of help out there.

You just got to find it. And honestly, to be very honest, we need to do a lot. We need to help people a lot more because it's very expensive to do this stuff in the short term. Yeah, that's sort of what I was going to ask next, which is that like, I don't know if it's whether it's government, the private sector, some combination of both or educational institutions. But in your view, because it's a coordination problem in part.

And I have to imagine there are, again, if there may be we're just a few really big landowners, then they could all get together and say, we're going to do X. But obviously there aren't. And so you have to coordinate between thousands and thousands or hundreds of thousands of small individuals. Who is best suited to sort of make that coordination? And then the economics, the part about sort of like changing the economic calculus so that the forest management, there's a reason for someone to do it. like who is in best who is in the best position to sort of like make those economics work where would we have to see leadership specifically well again i'm going to do the shameless plug this is where foresters come in we're really good at helping people figure out how to manage their land for the future and every piece of land is a little bit different from the next you know somewhere might have an evasive species problem and somewhere else is a deer problem and it's very difficult to manage it on a statewide level you have to manage it on a you know almost tree to tree stand level so sand is just a piece of land. It's a contiguous piece of forest. So you have to manage it on a forest level. Not like you can't, like, there's not like one answer. So it really comes down to conversations with landowners and just landowners, you know, funding good forestry and helping foresters get out there

and do good management and helping landowners do good management. So that's, you know, one thing that we can do. There are states do have foresters that help private landowners do good forestry. And also States are called service forces. Those people are great. They do good work. So, you know, having resources like that available is extraordinarily helpful. And then states do own, like all Eastern states, own a good chunk of private land. So they don't, it's not private land. It's private land. So they own a good chunk of land. So, you know, making sure that they are, you know, valuing that forest and not forcing it to fund itself. And like, all right, this is a service that is provided to the people of the state and the nation. So like, you don't have, you're not out there.

on a limb trying to make it work, like funded through, you know, budgetary stuff. Are there any legal changes that would be helpful or necessary when you think about, like, whether it's hunting invasive species, whether it's more burns, which I have to imagine contained some risk, I would assume, even if you're like, even if it's good for the forest ecosystem. Are there any situations in which existing law has moved in such a direction that is unhelpful for the type of forest management that the bourbon industry needs. Yeah, I mean, deer populations are super high. Bringing those down, because that's managed at a state level by state gaming agencies,

would be very helpful for a lot of forests. Taking biosecurity seriously and reducing the importation of invasive species would be great. There's a lot of invasives that you can buy at big box stores, and we could just ban the sale of those that be a great start. Japanese Barberry just got banned in Pennsylvania. And it's like, we've known this as an invasive species for decades. Why did it take so long to get this ban? So, you know, focusing on protecting what we have would be really great.

I think that that would be super help. Yeah. You know, and as far as prescribed fire, there's a lot, you know, in some of the southern states, the legislation is a lot more friendly to prescribe fire. But, you know, in other places, there's a really high legislative burden on people. who want to do prescribed fire, like you have to have super high insurance, which just makes it impossible to do. I'm not necessarily advocating this approach, but one method.

Tracy has an idea how to solve. No, no, no, I really don't. But what one- Take it. We'll take the thoughts. One method of conservation has to do with attaching, you know, an economic value, a concrete, immediate economic value to something that, you know, maybe is, in the existing system is hard to attach an economic value to because it's only going to mature in 100 years or whatever.

Is that a possibility here? Could you have some sort of subsidy or incentive structure for people to grow and keep those white oaks? Yeah. So that's, CRP does it already. We just don't say like this is white oak habitat conservation. You know, it's just funded through, you know, forestry practices. So we have something like this with pollinator habitat. You know, you're not out there counting the number of like bees and butterflies.

and other critters that use that pollinator habitat, but you can get money from the NRCS, which is the natural, sorry, national conservation resources. Oh, I forget the S. Service to, like, you know,

plant pollinator habitat on, you know, farmland that's not great. So we could just extend that farther into forests and make sure that program is funded all the way. Because right now it is mainly targeted at farmers. Farmers do own forest land, but like,

you know, also putting an equal emphasis on forest ownership would be super helpful, super helpful. How much, again, you know, going back to the sort of the actual bourbon makers, like, how much are they currently, I mean, I assume like they're pretty aware of this or thinking about their future, but like how much are they currently active in sort of themselves taking on leadership, whether it's fronting money, whether it's education, whether it's working with educational institutions or public institutions? Like, what are they doing right now? I don't know who are the big like brown foreman so you have like yeah yeah been I think it's

brown foreman yeah that's one of the big ones yeah they have you know seen that there's a there's a problem coming for him because you know when you're aging a product for 10 years you've got to look in the future so they seem they see the issue and so they're really starting they're really funding a lot of research into solving these these problems they've really stepped up to fund the white oak initiative we had a national foresters conference in louville a couple years ago and they were the you know, high sponsors. So they're, they're putting them, they're putting money where their, where their mouth is because this is the business, after all, you know, where white out goes, so goes the bourbon industry. So I, I would say they're doing a lot. So I could,

you could always ask for more money, but you, they're doing as much as it you really can expect. I have to imagine that if any industry is going to generally take like a long-term approach, it's probably like, there's always been part of the age things for a decade. Like, you know, we want companies that think long-term, like, Probably like any company that has an aging process, it probably like has that and they're like DNA to some extent. Well, this was going to be my next and probably last question, which is as a forester, you know, someone who cares about the forest, who thinks about this on a day-to-day basis and who thinks on those really long timelines of, you know, what is this land going to look like in 100 years? What advice do you have for getting people to care about these longer-term outcomes? is a super fun question

just go ahead and learn about your local landscape and what's in there once you I find with a lot of people like once you learn about plants and birds and stuff like that it's kind of an addiction and it's like once you start identifying trees on your landscape and you're just on your block you start to care more about them

Tracy we were talking before about your silver maple so it's like okay I know about this tree oh now I care about this tree and that tree and you start to see you know the forest for the trees to steal the old expression and you could do the same thing with bird habitat. We haven't even talked about the wildlife importance of white oak. There's everything in the forest eats white oak, you know, from bears to chipmunks to, you know, warblowers. Everybody loves it. So,

you know, conserving these species, you know, oak species conserves a really wide range of other wildlife species. So there's, you know, if you like birds, you like oaks. If you like deer, you like oak. If you like salamanders, you like oak. So once you get into the natural world, it's very easy to see, like, ah, this is, this is important. This white oak here. You this is kind of key for my my little piece of it. Any, you know, are there any other things that, like, people should be thinking about or, like, aspects of this? I mean, this is, like, a fascinating question, a fascinating conversation. You know, one thing that I've actually also, I just want to say I really enjoy about this is that

while there's clearly, like, this challenge coming, I appreciate, like, you seem optimistic that this is a solvable problem. Like, this is not, like, you don't sound particularly dumer about it, that this is, like, this inevitable. crisis that's going to happen the way that sometimes you have with certain like acute specific uh you know slow moving environmental stresses well you know the forests are incredibly resilient they've come back from a lot so i really believe in them and then the other thing is i do this every day every day i think about trees so if i was really do more about it it'd be a tough life i'm inherently an optimist despite the things that i work on i think that we can really solve

some of these problems not every problem can be solved but we can solve but we can solve you know, at least white oak is solvable. This is at least something we could do about. Are there any, you know, actually past periods, you mentioned the resilience where we can look to. Oh, can you talk about the sheep bubble in Connecticut in New England and how that led to a massive nooning of the forest? And since then, they've actually built back the forest quite well.

Yeah. So there was just a ton of sheep. And sheep rip stuff up. So they don't just cut the top off like a deer do. They'll actually rip it out. and ripped it all out. No more food. Sheep had to go west.

That's why you see a lot of sheep out west. So then the forest really came back. Another fun one is the Civil War. So Maine has on the flag, you have a sailor and a farmer. We think of Maine today as mainly forested. After the Civil War, Maine had the largest number of injured people missing limbs. And so they couldn't go out and log.

And then the forest just pop right back up. You know, Maine used to, they used to say you could drive. a wagon from Bangor, oh, down to, you know, like Kentucky without needing to be on a road. But if you look, if you go drive around Maine today, it's very well-forested. These places can come back. You know, I've seen some really, you know, degraded habitat. And if you do management, they respond well. The native plants are there.

They're very good at living and growing if you give them a chance. There are some species that are really imperiled like ash and hemlock, but oak is not one of those, luckily. I think that's a great place to leave it. It's like very exciting. It's very like optimistic. We've solved these problems in the past. I didn't know there was a sheep. Did you know that was that just something you knew about or did you in the prep like this morning?

No, no, that's something I knew about. So to Calvin's point about once you start learning about these things, you just go down this like this hole. But yeah, I started because I bought that land in Connecticut, three acres. I started getting really into this. So I know all about like kings planks in houses. and the big trees and how Blue Jays are responsible for the distribution of a lot of oaks in North America and also about the great sheep bubble of the 1800s and how that led to mass deforestation that we actually fixed.

We need to do a sheep bubble episode. I'd be into that. I'm not a sheep game. I'm not going to lie to you got to find somebody else. I know a lot of people in egg, so. All right. Well, you can help us find the right person. Kelvin Norman, this was such a fun episode.

I learned so many facts that I'm going to be that person in the corner of the me. is like they don't know and they'll like, shut up about this. You need to get to the level where you can start pointing at wood and being like, oh yeah, that's white oak or black oak. This is so cool. Calvin, thank you so much for coming on odd laws. Yeah, no problem. Thanks for having me.

And what's, you know, Tracy, to your point, once you kind of get into this, you really send the roots out and you really, you really dig into it. Yes, indeed. Thank you so much. That was great. That was fun, Kelvin. Thank you. Thank you for having me.

Tracy, I love that episode. And now, like, I absolutely could see how one could get really obsessed with learning about trees. And now, you know, I'm sorry, jealous of your, like, multi-acres. I already was, but now I'm more jealous. You have to come and see the trees. I bought a label maker so that I can – some of the trees are already labeled, but I'm actually busy labeling the rest of them. There were so many things I liked about that episode. But I did really like the fact that, like, this is a problem that's coming, but the possibility that this is also a solvable problem.

It's nice to have a sort of environmental climate change related supply chain episode that doesn't end with, well, this problem's unfixable. Yeah, because we talk about some of these things like, oh, this is bleak. But this is tough. But, you know, and there's some interesting economics, the fact that it's really long term. Right. The coordination of all these, like, sort of like small scale non-commercial holders of the acreage, the tension between the type of trees that grow best in sort of like perfect rows for houses versus. what the coopers need for the barrels, like so many sort of like economic things I would not have really thought about at all. Yeah, I do think, and again, I don't want to necessarily end this on a

down note, but it does seem like the ownership structure is kind of the challenge here because you don't necessarily have all these big commercial forest growers. Instead, you have small-scale farmers, individual owners, and you kind of have to talk to them, educate them, about how to grow these trees. Absolutely. Well, anyway, that was great. And maybe I'll, maybe I'll become a tree person now. You should. Actually, I was going to recommend a really good book. Tell me. It's Tom Wessel's reading the forested landscape.

Okay. And it's amazing because it has pictures of forest landscapes, and it kind of tells you all the things to look at, to study the forest history and learn about it. So you can look at a forest and you can figure out, like, where did the big storms come from? How did this forest actually grow? What kind of a forest is it? It's really interesting. All right. I'll have to check it out.

All right. Shall we leave it there? Let's leave it there. All right. This has been another episode of the Oddlots podcast. I'm Tracy Allaway. You can follow me on Twitter at Tracy Allaway. And I'm Joe Wisenthall.

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