Monday, June 11, 2018

Vanport International, Inc.

Date of Visit: June 8, 2018
Type of Event: Study Tour
Topic: International Wood Products
Organization: Vanport International, Inc.
Location: Boring, Oregon
Hosts: Adolf Hertrich / Chairman, Martin Hertrich / Vice President
International Fellows: Meei-ru Jeng (Taiwan), Xuejiao Li (China), Thammarat Mettanurak (Thailand), Tuan Manh Phan (Vietnam)
WFI Staff: Shadia Duery / International Fellowship Manager, Vivian Bui / Professional Programs Coordinator

Recently, Adolf Hertrich, Chairman of Vanport International, Inc., graciously hosted the WFI International Fellows at his office in Boring, Oregon to share the history of his company. Born in Germany, Adolf Hertrich immigrated to the United States to study forestry at the University of Michigan. After finishing his studies and serving in the military during the Korean War, Adolf spent 7 years working for the U.S. Forest Service in Mount Hood National Forest in watershed management and recreational services. In 1967, Adolf decided to leave the U.S. Forest Service and start his own forest products business. He had noticed the frequency with which Japanese trading companies came to the Pacific Northwest to purchase logs, so he began to purchase timber sales, sometimes through auction bids, from the U.S. Forest Service. Adolf would then hire a logger to harvest the timber, then sell the highest grade timber to Japan, lower grades to local mills, and 8"-diameter or smaller for pulp. He eventually purchased a mill in Boring, Oregon that had gone unused for 2 years and, by installing new machinery, was able to produce 140' of lumber per minute, roughly 20 times the amount produced by his top competitors.

At first, Vanport exported round logs to Japan but, following the implementation of regulations banning the export of round logs sourced from national forests,  the company was forced to adapt their methods. They learned how to cut logs to lumber in a way that was suitable for the Japanese market, including converting to the metric system and becoming well-versed in the Japanese grading system for lumber strength and appearance. Eventually, Vanport became the first company outside of Japan to receive a grade stamp from the Japanese government, after Japanese mills sent graders to Vanport to verify lumber and mill accuracy. Around this time, Adolf noticed that Japan was ramping up the export of goods to the United States in shipping containers, and that, oftentimes, these containers would return to Japan empty. He seized this golden opportunity to ship lumber to Japan at extremely low transportation costs. Vanport also opened a bank account in Japan, allowing the company to sell directly to Japanese clients while avoiding currency exchange costs.

(Left to right) Tuan Manh Phan, Xuejiao Li, Martin Hertrich, Shadia Duery, Adolf Hertrich, Meei-ru Jeng,
and Thammarat Mettanurak in front of the Japanese-style teahouse that was custom-built for Vanport
by the company's highly skilled carpenter, Matsushito-san

Today, Martin Hertrich, Adolf's son who is trained in marketing and wood science technology, serves as the Vice President of Vanport. After the closure of the Boring mill in 1999 due to a ban on old-growth logging in Mount Hood National Forest, Vanport no longer owned any local manufacturing facilities yet the company continues to export $100-150 million in lumber annually. Nowadays, their main lumber sources are found in Russia, Germany, Canada, and Uruguay, and they mainly export to Japan and China, with Vietnam serving as a growing market.

Read more about Vanport International, Inc.!

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