Devin Stockfish: Yes. In terms of monetizing, we are out in the market right now, marketing that. We are having, I think, some very productive discussions I would expect us to be selling through those initial credits in relatively short order. And as we said, I think during the last call, we are anticipating that’s going to be priced somewhere in the mid- to high 20s range on a pricing standpoint. The annual carbon credits is really just tied to the growth trajectory and the carbon sequestration trajectory over that 20 years. So it can be a little lumpy. It’s not necessarily a straight line in either direction. It will just depend on the growth profile across that particular forest.
Paul Quinn: Great. That’s all I have. Best of luck.
Devin Stockfish: All right. Thank you.
Operator: Our next question comes from Mark Weintraub with Seaport Research Partners. Please proceed with your question.
Mark Weintraub: Thank you. Devin, I appreciated your rundown on thoughts for single-family next year. Would you share kind of your view of how you think repair remodel might play out and the key drivers behind that view?
Devin Stockfish: Sure. I think it’s — there are kind of puts and takes there, Mark. On the one hand, a lot of the drivers that have been around for a number of years that have been spurring repair and remodel are still there. We still have an aging housing stock. People have equity in their homes. I do think this lock-in effect that we are seeing with everyone having refinanced at low rates, and it’s going to keep a lot more people in their homes that otherwise would have moved. And so that’s probably going to spur some level of repair and remodel demand. On the flip side of that coin, obviously, when people move, that’s a catalyst for repair and remodel. And if fewer people are selling their house and buying into new houses, that’s going to be a headwind.
And to some extent, higher interest rates can also be a little bit of a headwind there. So some puts and takes. Our view is, overall, we are expecting that market to remain solid. And I think you’ve kind of seen few different views on this, whether it’s up slightly or down slightly, our view is it’s probably going to be flat to up slightly next year, all things being equal. We’ll certainly see a little bit of a slowdown here in the winter months as we always do. There’s always some seasonality to that. But as we look out into 2024, I don’t think we’re going to see the growth rates that we saw during the heat of the pandemic by any means. I think we’ve kind of returned to pre-pandemic levels of growth, and I expect that’s probably going to be the case next year absent material recession or some other event that adds an additional headwind there.
Mark Weintraub: Okay. Thank you. And maybe just following up on one of the prior questions that was asking about share repurchase and your stock trading at discount to underlying timberland values. I mean, are there scenarios where if the discount is wide enough, it makes sense to sell timberlands especially given that you’re probably going to be in that situation when maybe your wood products businesses aren’t doing so well. So you’re not generating as much cash. And so are there scenarios where you have plans to sell timberlands and then use those proceeds to buy back your stock at what might be a wide discount?
David Wold: Sure, Mark. Yes, this is Davie. We are always looking at ways to ensure we are maximizing shareholder value and how we generate cash and allocate that capital and like I said earlier, we are fortunate to have a number of levers there. But really, if I take each of those components separately, we’ve been very active in the market repurchasing shares, having done $733 million over the last couple of years. So we certainly view that as an attractive opportunity for us to deploy capital. And then on the selling of timberlands, our view is that the value of timberland is only going up over time and recent transactions certainly demonstrate we are not the only one with that viewpoint. And so that’s why we’ve got that target to acquire $1 billion of timberlands over the next several years and ultimately why we expect to be a net buyer of timberlands over time.
But of course, we haven’t been afraid to make adjustments to our portfolio in the past. The real estate program is a great example on how we monetize properties with a better use to generate capital that we can deploy for other purposes. So as of now, given our strong balance sheet position and the views that we have about the value of timberlands over time, I’m not sure that we’re looking to divest significant amounts of timberland.
Mark Weintraub: Okay. But at the bottom line, kind of arbitraging the spreads is just — it’s not the type of thing that you think is sufficiently dial [ph] moving to be kind of a significant part of the toolkit. Is that there?
David Wold: Yes. I mean we are always looking at all the levers available to us, but I don’t know that I see us divesting a significant amount of timberlands in the near future.
Mark Weintraub: Okay. And maybe just one small detail. So you had — you’re indicating OSB prices obviously are down from where they were in the third quarter. In EWP, though, you talked about the costs going up? And is that just a lag, or what was the difference between those two directions?
David Wold: Yes, Mark. So the way we do those internal transfers is we have a 13-week rolling average on that pricing. And so based on the trajectory of where OSB prices went over the quarter, we do expect that to be up a little bit quarter-over-quarter.
Mark Weintraub: Okay, great. And then lastly, is there much in the way of difference in how we should be thinking about the carbon projects in the South that you are reviewing versus what you did up in May? And maybe if you could explain how they might be different? And in particular, any financial ramification differences as we think about them?
