Garriss 1

Kendall Garriss

Atlanta Trip with Wayne Lohman (Marketing Manager, Professional Vegetation Management)

During my experience working with BASF I had the opportunity to travel and work with Wayne Lohman, the Marketing Manager within the Professional Vegetation Management division of BASF. Prior to this trip most of my days consisted of gathering information and research about the forestry industry. However, this proved to be an exhausting task since I was not an expert in forestry nor did I have any formal education about the agricultural market. But my three-day trip with Lohman gave me the chance to put into perspective all of the research and work I had been doing in the corporate office. Each day I would be exposed to individuals who were involved in the business and see different sites and facilities that would really allow me to gain a better grasp on the research I had been doing.

My trip started on Monday, July 20th , 2015. After meeting Lohman at the Atlanta Airport, we drove all the way across the Alabama border to a small town called Eufaula, where we ate lunch with two representatives from Southern Pines Production, one of BASF’s leading distributors, Cub and Randy. One of the many things that I learned was that the business operates within a complex network of relationships. A chemical company such as BASF or Dow will manufacture the herbicides, pesticides or other form of treatment and will then sell their products to a distributor, such as Red River Specialties, Crop Product Services (CPS), or Southern Pine Productions. Distributors act and serve as sales support for the larger companies and are the primary contact when it comes to interacting with customers, warehousing, logistics and credit. There are also applicators, independent individuals who are responsible for the actual application of the product, whether that be via aerial or ground methods. Lohman mentioned that applicators care little about logistics and details because “the only time they are getting paid is from the time they turn the nozzle on, to the time they turn it off.” Large companies, TIMO’s and Consultants are all involved in the process as well. TIMO’s are Timber Investment Management Organizations that work with large investors like FIA and Hancock as well as consultants, who work for TIMO’s and private landowners to manage forestry land.

Randy, Cub, and Wayne all talked about the industry and a little bit about what their role was in the whole process. After lunch, Cub was nice enough to take us to a few sites around the area so I could get a better since of what the end result looks like. I was able to see multiple sites at different stages during the development and treatment process.

Garriss 2

This is an example of one of the sites that we visited:

This is a very good example of site preparation. The weeds have been controlled in such a way that they are not competing against the pines that they are growing next to. All of the sites that we visited had been treated initially with Arsenal, one of BASF’s main projects, whose active ingredient, imazapyr, is considered the best of the best when it comes to getting rid of hardwood brush, grass and broadleaf weed. The unique thing about imazapyr is that it does not affect pines, which is helpful when one is trying to grow pines.

On the right, is a pine that is around 1-2 years old. Because proper site preparation was conducted this pine has ample space, access to nutrients and sunlight. However, not all land managers take all the necessary precautions when planting their trees. Forestry demands consistent maintenance and if left unchecked, uncontrolled herbaceous weed growth can inhibit and hinder the growth process for pines. Stunted growth will result in substandard products which will garner a significantly lower return on investment (ROI) than if one conducted a proper site preparation.

After our road trip with Cub Smith, Lohman and I continued driving and made our way to the city of Albany, GA. In Albany, we had dinner with another one of the sales representatives from Southern Pine Productions, Taylor Freeman. Like Cub and Randy, Taylor was responsible for interacting with customers and landowners as well as going to different sites and overseeing application runs. Taylor was actually scheduled to supervise an aerial spraying that was supposed to be done the following day, which he said I would have the opportunity to witness.

The following day, Lohman and I traveled to Americus, GA, where I had the chance to meet with Bo Ewing, the Area Manager of Red River Specialties, another one of BASF’s biggest partners. Bo talked a lot

Garriss 3

about his work and how a great deal of it was working with consultants and private landowners to satisfy their needs. When it came to consultants, many of them would do a lot of the legwork and often had most of the land mapped out so all Bo had to do was visit the site to assess the situation and provide them with the combination of treatments that would serve best to combat whatever species was there. While we were there, I had a chance to see the Red River Specialties’ warehouse, where they stored all of their different types of treatments.

One thing I found interesting was the assortment of chemicals that were in the warehouse. Originally, I thought that each major distributor would partner with a single chemical company, who would serve as the primary provider for all their chemical needs. In reality, major distributors such as Red River Specialties have deals with several major companies. So within their warehouse, Red River Specialties had products like Arsenal and Chopper Gen2, which are chief BASF staples, and then a variety of other products from companies such as DuPont, Dow, Bayer and more. Bo also said that when he is creating a treatment portfolio for a client, it will almost always consist of a combination of products from 3-4 different companies. I found this intriguing because although these companies are competitors in the business sense, they actually rely on each other and are more effective when they are combined with their competition.

I also gained some insight about how their supply chain operates. Red River Specialties has to invest a lot into their forecasting because their orders are usually placed about a year in advance, so it is necessary for them to calculate future demand, which is often discerned from past sales and predictions about the upcoming year. Red River Specialties primarily uses trucks to deliver their products. When an order is placed, the company will contact one of their truck drivers, who will pick up the products and then transport them to the site for application. Coordination with the truck drivers is fairly easy and they are usually flexible when it comes to the schedule. For example, Bo said that he had a list of guys he could contact that would be willing to do a last minute shipment if a client needed it early the next morning. Even when this fails, Bo said all of his workers are qualified to load up the shipments and transport them to the sites themselves if necessary. I also spoke with a worker named Travis, who also works at Red River Specialties. Travis’ job consisted of coordinating with the applicators and informing them where/what areas of land needed treatment. Travis used a combination of mapping tools and computer programs to generate images for the applicators. The applicators receive the mapped images and are able to adjust their route so that they can target the proper area. It is almost as if Travis provides the applicators with a black-and-white outline of a picture and all the applicator needs to do is take this outline and “color” within the lines.

Garriss 4

When I asked Bo about the future of the forestry industry, he was very optimistic. Bo said that this was a really exciting time to be in the market and he’s excited what the next few years will bring for the industry. Bo also said that there has been a change in mentality within the forestry industry. Instead of just trying to kill everything that’s in site except your trees, more people have been trying to adapt their products so that they kill the weeds but also allow for the biodiversity that occurs naturally in the area to grow and prosper as well.

After this visit, we rode down to Forsyth, GA, where we had a meeting with the Southeast Forestry Regional Manager at Crop Production Services (CPS), who was aptly named Gordon Forester. Gordon has been working in the forestry industry for almost 35 years, living and working through the industry’s heyday during the 1990s and its absolute lowest point during the economic recession of 2008-2009. Gordon had a more critical view of the forestry market than Bo. Gordon believes

that there is little to no future for the forestry industry. He said that many of the practices that are implemented are inefficient and that applicators are overlapping their treatment streams, meaning that in some places there maybe a little extra treatment applied which may not be necessary so it is considered a waste. Gordon also said that there needs to be more interaction and cooperation between governing bodies. Gordon, like other foresters, understands that this kind of cooperation is necessary and would yield higher profits but no company wants to be the first to concede.

After speaking with Gordon, Lohman and I contacted Taylor Freeman, from the previous night, to see if the aerial units were going to be flying that day so that I could see a live aerial treatment. However, Taylor informed us that due to the strong wind the planes were not going to be flying that day. According to Taylor, the weather and landscape conditions are often the deciding factor in whether or not aerial treatment is feasible for a given day. If the wind is too strong the treatment can be picked and carried over to another patch of land or someplace else where it could be potentially dangerous. So instead of going to that site, Lohman took me to a few other sites in the area that had done an early

release, which consists of doing herbaceous weed control to keep from weeds growing after the trees have already planted.

The picture to the left is an example of an early release. Not only was a traditional site preparation conducted but additional treatment was added to get rid of the extra brush that occurs annually. This is why most of the area around the pines is brown, in contrast to some of the early pictures where one can still see some of the brush on the ground. However, the practice of early release has decreased over the last few years as the cost of site prep has increase due to generic competition.

One of the other common practices in forestry is thinning. This process usually occurs between years 13-15 of pine growth. This is the act of going through the trees and cutting down many of the smaller trees so that the

Garriss 5

bigger, stronger trees will have a better chance to grow to full size without having to compete with the less developed trees that may surround them.

A few years after a thinning, it is not uncommon for a forester to return to a site do what it called a mid-rotational shift, which is becoming a more popular practice within the forestry industry. This process consists of treating the brush that develops in under the canopy after thinning has already been conducted.

On the last day of my trip, Lohman and I sat down and discussed everything that we had seen over the last few days. He went over a few more topics of interest and gave me access to a few more resources. One of these resources was a return on investment model that was created by forestry expert and Smarter Forestry founder, Barry Shiver, and later adapted for BASF’s purposes. With a few simple inputs, such as species type, trees per acre, current age, competition type and more the model is able to generate what a potential client’s return on investment will be. Lohman mentioned that this has been an invaluable tool and that he has sent this same model to people like Taylor and Cub so they can show their clients what they are investing in. This model is very unique because it is very flexible and it gives the user several options to experiment with and see what each different result yields. Although not all models are correct 100 percent of the time, this model gives the client a good feeling for what they can expect. Because the forestry industry is one that can require anywhere from 15-30 years for a certain plot to reach maturity, potential clients want to know exactly where their money is going and if it is truly something that would be worth investing in.

One of the questions that I had been meaning to ask Lohman was why there were dissenting views about the future outlook of the forestry industry. As I mentioned, Bo Ewing of Red River Specialties was very optimistic about the future of the market while Gordon Forester, who worked in the forestry department of CPS, said that the market was in a slump and would stay that way for a while. Lohman explained it to me like this: Bo is a not a forester, he’s a salesman. Lohman talked about how the forestry market can make people skeptical and especially for people like Gordon, who work in the market every day, it can be difficult to see the silver lining in the industry. I thought that this divide could have also been the product of a generation difference. Bo is a younger man, probably mid-40s, in the “prime” of his career, while Gordon was about to turn 65 and was looking at retirement within the next few years.

Wayne Lohman, has been working with BASF for years and has served as the Marketing Manager of the Professional Vegetation Management for the last four years. Lohman serves as the only representative for the forestry department within BASF for the entire United States. Previously, BASF had 23 representatives that would cater to the needs of their clients within their given geographic region, most of the representatives, being concentrated in the South, where almost 90 percent of forestry business takes place. However, due to budget cuts and profit loss, BASF was forced to scale down this department to just one person, who would take on the responsibilities of 23. Lohman, is centrally located in Athens, GA, so he is able to travel to most of the major sites within the South with relative ease.

Garriss 6

However, because he is only one man he has to sacrifice some of his customers who may be in regions like the Mid-West or the North. Lohman has announced that he will be retiring from BASF on July 31 st, 2015. As we met with all the individuals over the previous few days there was something that I found very refreshing. The relationships that Lohman had with his clients were more than just business relationships. They were genuine friendships. These were people that knew about Lohman’s family and personal life and vice versa. It was the kind of relationship that might have occurred naturally in life even if they hadn’t been connected through business. I think that kind of dedication is something that is hard to replicate and expecting Lohman to maintain those kinds of relationships with the entire U.S. market is entirely unrealistic and would be spreading him even thinner than he has already been. If BASF, has at least five more representatives that approached business and relationships with the same attitude that Lohman did, than BASF would once again become a dominant force within this market.