Good morning, my name is Marlee, and I will be your conference operator today. At this time, I would like to welcome everyone to the Weyerhaeuser Third Quarter 2012 Earnings Conference Call. [Operator Instructions] I would now like to the call over to Ms. Kathy McAuley, Vice President, Investor Relations. Ma'am, you may begin your conference.

Thank you, Marlee. Good morning. Thank you for joining us on Weyerhaeuser's Third Quarter 2012 Earnings Conference Call. This call is being webcast at www.weyerhaeuser.com. The earnings release, analyst package and web slides for this call can be found at our website or by contacting April Meier at (253) 924-2937. Please review the warning statements in our press release and on the presentation slides concerning the risks associated with forward-looking statements, as forward-looking statements will be made during this conference call. Joining me this morning are Dan Fulton, President and Chief Executive Officer; and Patty Bedient, Executive Vice President and Chief Financial Officer. As summarized on Chart 1, Weyerhaeuser reported third quarter 2012 net earnings of $117 million or $0.22 per diluted share. That was our net sale of $1.8 billion. There were no special items in this quarter. Turning to our business segments. My comments reviewing the third quarter of 2012 refer to changes from the second quarter of 2012. Beginning with Timberlands, Charts 3 and 4. Timberlands contributed $80 million to pretax earnings, $3 million more than in Q2. Revenues from Timberlands exchanges were $24 million in the quarter, an increase of $17 million. In the West, log prices declined approximately $5 per cubic meter. Domestic log prices decreased due to an abundant supply of farmer wood. Export log prices were up slightly due to mix. Dry conditions and fire danger in the West resulted in a 3% reduction in fee harvest volumes. Road costs in the West were seasonally higher. In the South, log prices increased 2%, third-party log volumes rose 6% and the fee harvest was slightly higher. Silviculture costs in the South were slightly lower as planting was deferred into dry weather conditions. Wood Products, Charts 5 and 6. Wood Products contributed $59 million to…

Thanks, Kathy, and good morning, everyone. Thanks for joining us today. I'll start by saying that I'm pleased with our strong quarterly performance. As Kathy noted, we earned $117 million during the quarter. Comparing this quarter's earnings with our second quarter earnings before special items, we had a quarter-over-quarter increase of $70 million, with each of our core business segments showing gains. The rise in our earnings was a result of ongoing business improvement initiatives, coupled with increasing strength of U.S. housing, which allowed us to capitalize on the full value of the company. Before I offer some brief comments on the performance of each of our business segments, I'll provide a macroeconomic context for our quarter. First, the housing market. On last quarter's call, I noted that the long-awaited housing recovery looks and feels real. After another solid quarter, all indicators point to continued steady improvement. Recent September housing starts data shows a seasonally adjusted level of 745,000 for the year, confirming what we're seeing on the ground in the marketplace. In addition to increased construction activity, we now have the latest release of the widely reported Case Schiller numbers, which are a bit of a lagging indicator. These numbers show broad modest increases in pricing across most major markets. Price increases helped build consumer confidence, which then begins to move more potential homebuyers off the sidelines. While today's construction levels are still low by historic standards, all forecasts point to continued recovery in 2013 as we begin to return the long-term trend levels that are needed to house a growing number of U.S. households. Since World War II, housing has normally led the way out of our cyclical recessions, but as economist Rogoff and Reinhart suggest, this time is different. In this recovery, the broader economy began to…

Thanks, Dan, and good morning, everybody. Notwithstanding the uncertainty in the overall economy, we are pleased that nearly one month into the fourth quarter, we continued to see the sustained signs of an improving housing market. Our outlook for the fourth quarter is summarized on Chart 12, and I'll begin my comments with Timberlands. In the West, domestic log prices are anticipated to be slightly higher on volumes comparable to Q3. Export volumes to Japan, our highest margin log, remain strong and are expected to increase in the fourth quarter. Housing markets in Japan have been stronger this year, driven by a combination of historically low mortgage rates, planned increases in consumption taxes in later years and some rebuilding and repair activities from last year's tsunami. The weak euro continues to create heavy price competition from European laminated lumber. Demand and prices for our logs to China are expected to increase moderately, with improvement in both residential and commercial construction activity. In the South, realizations for logs are expected to be slightly lower due to a smaller piece [ph] size, with a heavier mix to chips and fiber. Fee volume is likely to be slightly higher seasonally. We will see significantly increased costs, mainly due to the timing of silviculture treatments. Nonstrategic land sales are expected to be flat to Q3. Overall, we expect earnings in our Timberlands segment to be comparable to the third quarter. In Wood Products, the fourth quarter is traditionally one of the weakest earnings quarters of the year due to seasonality. While we do not -- while we do expect to see some softening as we progress through the quarter, to date, prices and volumes have been unusually strong for this time of year across most product lines. We will likely have reduced volumes later…

Thanks, Patty. Quarterly results from all of our business segments demonstrate the operating leverage that we have to a recovering housing sector, as well as operational improvements in each of our businesses that are increasing our competitiveness. We will continue to focus on what we can control, improving our operating performance and our relative competitiveness, being prepared to take full advantage of the quality of our assets, the strong relationships with our customers and suppliers and the commitment of our dedicated employees. And now we welcome your questions and comments.

[Operator Instructions] And your first question comes from Anthony Pettinari with Citi.

I got a question on cost. You've done a good job of containing SG&A over the past year. But as we look forward to 2013, there's a possibility you could be growing revenue, maybe in the double digits. You should be seeing volume recovery in most of your businesses. Can you talk about how you think about SG&A targets in that environment? And then in terms of working capital requirements, as you ramp up volumes, what are the working capital needs and maybe the incremental capital spending that's going to be tied up as we move closer to a million starts next year or the following year?

Let me first talk about -- address your question on SG&A. We've made a tremendous amount of progress on bringing down our overhead expenses over the last 3- to 4-year period, and our journey is not done. We continue to look for opportunities to continue to ratchet down our G&A. However, we are now shifting to a period where we expect to be growing because of the pickup in housing and the need to be restaffing in certain locations. A lot of the restaffing is not reflected in G&A, it's cost of sales headcount. So we continue to be focused on managing our G&A and keeping the gains that we've made during this downturn. We would expect selling cost to be increasing, coincident with the pickup in sales because fundamentally, most of our selling costs are tied to revenues. And we would expect selling-related expenses to be increasing as we begin to recover. As we think about working capital, Patty commented that we shouldn't expect the same level of working capital at the end of this year in our Wood Products business as we had last year because we are selling more material and we are manufacturing product not just to maintain our current level of business, but as I mentioned in my remarks, we are increasing sales in certain channels. And so there will be some additional working capital related to increased sales activities as we go into 2013 and as we continue to expect housing starts to recover. We would expect the same thing to be showing up in our WRECO business throughout 2013 because we expect our volume to be increasing coincident with the pickup in housing.

Maybe the one thing that I would add, and you saw that in this quarter, as Kathy commented, where G&A will go up to the extent that it -- the stock price impacts, the variable compensation in terms of marking our share price to market. So I look forward to that part of the G&A going up, but as Dan said, we'll continue to stay very focused on holding on to the G&A gains and really increasing that through productivity and some of the activities that we have underway.

That's very helpful. And then maybe just shifting gears to Chinese log demand. You referenced expectations for improved log prices on Chinese homebuilding activity. I'm just wondering, can you tell us what you're seeing in October and is that something that you're really seeing now? Is there sort of an expectation for an improvement towards the year end? Or can you just give us any kind of color on what you're seeing now?

Well, we saw some pickup in our export activity in the third quarter, probably a little bit better than we might have imagined. We had been anticipating some market recovery towards the end of the year. We were able to capitalize on better conditions in the third quarter, and we would expect that to continue through the fourth quarter and into next year. Some of that, as I said, is related to working down inventory, generally in China, but also us continuing to capitalize on the relationships that we have developed with our Chinese customers. There was a slowdown in construction in China that now seems to be reversing itself a bit. Remember that we're not selling structural grade material into China for wood frame housing. The wood that's going to China is used in construction for, primarily, forms as well as other industrial uses. But I think we're seeing the benefits of the predictability of our logistics, the quality of our logs. And so we expect that we continue to take advantage of the opportunity in China, recognizing once again that our largest market is Japan, where our export volume for logs.

But Anthony, to your question, what we're seeing for China now, we are having -- and they are moderate increases, small, but we are seeing the pricing picking up on our China. And as Dan talked about, we really go through very established customer relationships. So it may be a little different than what you're seeing in the broader industry.

Your next question comes from Mark Connelly with CLSA. Mark W. Connelly - Credit Agricole Securities (USA) Inc., Research Division: So 2 things. I mean, everything you've said about housing is right and bullish and I think we all feel pretty good about it. Was the increase in the cancellation rate anything special or is there something we should be watching for there? And then a second question, I know I've sort of asked of this question before. As I talk to Southern landowners, they tell me that rotations are changing dramatically just by default. Is your system not seeing that just because it's so big?

With respect to cancellation rates, I think they've been extraordinarily low for the last several quarters, and I think, Mark, what we're seeing is a return to perhaps a little bit more normal situation. The primary reason today for cancellations is the channel and [indiscernible] qualification, which is still a difficult process for most home buyers. And so there is some level of discouragement that leads some to drop out but I -- I don't view the uptick in cancellation rate to be troubling. In fact, there's a very low level of finished inventory in the market for new homes and the inventory levels of these sales have come down pretty dramatically. So there's a shortage of product out there and that causes me to feel relatively comfortable. Southern log rotations, we're not seeing any significant changes in our system.

Your next question comes from Mark Wilde with Deutsche Bank.

Dan, again, I appreciate the increased data and kind of visibility inside Weyerhaeuser we continue to get from you guys. I did wonder today, can you give us any color on the non-strategic timber sale in the quarter, just in terms of location, acreage and values that you're seeing out there?

Mark, this is Patty. Actually, it's not just one, there's a number of ones that we have that are small in size. Most of the activity that took place this quarter, I believe, was primarily in the South.

Okay. And do you have an expectation, Patty, for what we will see over the next 12 to 24 months in terms of aggregate levels of nonstrategic sales?

Well, Mark, it's difficult to know. As you know, those sales are lumpy. I wouldn't see a significant pickup in the amount of acreage that we would bring to market from a sale perspective, only because we've really optimized the portfolio. So in terms of additional non-strategic assets, as you know, we sold a fair amount over the past. In terms of things that might come on the market, I think we are seeing some pickup from the industry broadly, but difficult to know exactly what will happen over the next 12 to 15 months.

Okay. And could you talk a minute -- at WRECO, what you're doing vis-à-vis lots and lots of options at this point?

Yes, I mean, we always approach the WRECO markets differentially, Mark, as we've explained in the past. It's really a function of what the entitlement risks are in each market. We are always active in the market. We have a strong pipeline of lots at various stages. And so we're confident that we've got lot availability that we can see for an increase in activity in 2013. As we look out towards 2014, our plans are in place to be sure that we've got the improvements going in, so that we'll have finished lots for those timeframes. We also have lots, I think, as we discussed before, that where we have the ability to sell to other builders at the right time and the right place, and we've got the optionality in our portfolio to either build homes on those lots or to sell them to others, if that happens to be an advantageous strategy. The lot market is tightening up in most major metro areas, especially finished lots. So the industry is working through a lot of the lots that had been developed prior to the turndown in the cycle. Now, we're back into a mode of having to put in infrastructure improvements to complete new lots. And so that is causing some escalation in prices in most markets.

Your next question comes from Chip Dillon with Vertical Research.

The thing that stood out, and I know we're not back to normal times and who knows what normal will be. But when you go back in the past, it seems like you all had usually a rush of closings in the fourth quarter in Real Estate that really took the number up a lot. And again, knowing we're just on the turn, I can see why it might be premature. But is there anything else going on in that might make the pattern seasonally be different as we go through the next few years as housing, I assume, continues to recover as that happens? Or will we -- at some point -- or is this an unusual year that the fourth quarter is not really moving up a lot?

Well, our fourth quarter closing estimate is increasing, and that is typical with the seasonality that you observed in the past. I think that's typical, not just for us, but for other builders. And so we have actually a fairly significant increase in closings that are projected. As Patty pointed out, the margins will not be as great as what they were in the third quarter. And so that's a quarter-over-quarter comparison that's important to recognize. Q3 margins were higher than normal because of a mix that was heavier to San Diego, especially some projects in San Diego where we were closing out subdivisions and had very high margins. As we move to the fourth quarter, the shift of mix moves away from San Diego to more affordable markets where margins are lower and is further affected by the fact that we have a significant number of closings that we're projecting out of our Winchester operation in the Washington D.C. Metro area, where they will be delivering some affordable homes that are required as part of the entitlement process in Maryland and Virginia. And so those are very low margin homes that are part of an overall subdivision development. Those affordability requirements are imposed on developers in projects that are roughly 50 lots or more. And so what you're seeing really is a quarter-over-quarter comparison that is a mix shift and it accentuates those differences. But we still expect an increase in activity in the fourth quarter foreclosings. What is noteworthy this quarter, as we look at the fourth quarter, I think as Patty noted, normally, we'd have more slowdown in the Wood Products business. And what we're seeing is pricing hanging in there a little bit longer than what might be normal and I think that's related to construction activity, not for homes that will be delivered this fourth quarter, but early next year.

So Chip, just to give you some numbers on the closings, if you went back last year in the third quarter, we were at 508, and we went to 582 in the fourth quarter. This quarter, the third quarter, we were at 615 and we'll be over 800 in the fourth quarter for this particular quarter.

Got you. And that's very helpful with the mix. It sounds like it's unusual. I just want a quick follow-up. I'm looking at your guidance for Wood Products, and we always -- as we all know, have to take it with a grain of salt given the volatility although there are lags. It just seems to me that you are taking a quite cautious view, especially given that in the last week or 2 we've seen a rise in the price of both lumber and OSB at least in the trade press. And now we've got this hurricane, which of course you guys don't have to worry about out there, that is about to visit us here on the East Coast. And so I mean, are you taking a large dose of the normal seasonality in putting that into your guidance? And -- or do you actually think this is -- that no, which -- are you being conservative?

I think it's a fair statement, Chip, that our overall guidance is conservative. As you appropriately pointed out, volatility for pricing in both of those commodities has been a pleasant surprise, both in the third quarter. And as I said in my opening comments, to date, in the month of October, we've been pleasantly surprised with the strength of pricing. Just to give you maybe some way to gauge that a little bit, in lumber, every $10 of movement in price for us, in this quarter, it will be about $3 million per month, given the volumes that we're projecting for the fourth quarter. And in OSB, every $10 is $2 million a month. So those earnings move pretty dramatically with price increases. So if these price increases hold, we will be above the guidance that we gave you for the fourth quarter, and I think you know this. The nice thing about Wood Products is you do get some visibility as we go through the quarter in terms of what's happening out in the market, given the printed publications that come out. But we're pulling for higher pricing in both of those. And I would be very pleased later in the quarter to be reporting that our guidance for the fourth quarter was higher than what we're talking about today.

Two final comments on that question, Chip. When the new housing start numbers were announced last week, that did cause some increase in activity among our customers because our customers are running with very thin supply inventory levels, and they would normally be managing inventory levels down at year end. And so good news with starts causes the channel to react relatively quickly, especially with limited amount of product in the channel. And then finally, we do care about the hurricane. That will potentially affect our manufacturing business in our woods on the East Coast, as well as overall market conditions for our customers, and so we're concerned about that just as much as you are.

Your next question comes from George Staphos with Bank of America Merrill Lynch.

Two questions. One on WRECO to beat that perhaps into the ground and one on Cellulose Fibers. The closing that you're projecting for fourth quarter are actually pretty normal relative to your backlog if you look over history. And certainly, you've talked about mix and the fact you have more affordable housing being produced this -- or closed this quarter. Yet, traditionally, then the fourth quarter from an EBITDA dollar standpoint and operating profit dollar standpoint, has been in fact larger than the prior quarters. Should we now assume that this change in mix is something that we should expect for future periods? Are there any implications from this or is this really just a one-off factor? And when you're talking about mix, could you relate at all what the selling price changes were on what closed this quarter within your regions? On Cellulose Fibers, my question is have there been any positive or negative implication thus far in terms of your demand from some of the outages that we've heard about on superabsorbents relative to that Japanese factory explosion?

So George, I'll answer it in the order that you asked them. With respect to the fourth quarter, it is a mix issue, especially relative to Q3, and it includes these affordable units. And the issue on the affordable units is that there's a different rhythm to them. So in our Winchester operation, which is where these sales are coming from, they are normally a pre-seller of homes. So they take an order and then they build the house and deliver it. With these affordable units, they are attached, they're part of a larger project. We build them and then when they are close to completion, we turn really the sales process over to the community entity that handles these affordable units. And so it's a larger number of deliveries all at one time. And so when you have low margins in a large group of homes, it will tend to drag down the overall mix. That's not something that I would expect over time, but there is some lumpiness to the way those affordable units are delivered. We are also seeing an increase in closings that tracks the sales that we've had earlier in the year in some of our lower-priced markets, and so that is also affecting margin. As we look at cash flow, the increased activity in closings will generate more cash flow even if margins are down a bit because fundamentally, we're recovering all of our costs, including the land cost that's invested in those slots. With respect to the question on the SAP...

Maybe before you go there, Dan, in terms of the EBITDA quarter-over-quarter, fourth quarter last year to this year, the other thing that impacts that, George, I think you referenced that the average closing price itself. And you can see that delineated somewhat on Chart 10 that's in the packet. You can see the average closing price at the end of last year's fourth quarter was almost $400,000, this year it's $372,000. Right below that graph, you can see the average sale price, which came down through the end of last year and the beginning of this year, but now it's trending back up again. So it's a combination of those 2.

Patty, that's mix. So I mean, would you say that all your markets are seeing increases in selling prices even if the mix itself has changed the average price that you're reporting?

We are seeing some. It's not a huge significant amount. We certainly will look forward to seeing more as housing recovery is greater, but...

We did see a pickup in the quarter in September. So if we look at our -- September numbers are different than the quarterly numbers, but the September numbers, prices were up, I think, in every single one of our markets. Question on the SAP outage in Japan, that did lead to some activity with some of our customers who are trying to replace the amount of production. I think that plant produces about 20% of that product worldwide. And so our key customers contacted us, and we've been taking some of their needs in order to fill the gap that they'll experience with that outage.

Your next question comes from Alex Ovshey with Goldman Sachs.

Well, with the housing momentum gaining the -- with the housing momentum improving, especially with the housing starts number that we saw a couple of weeks ago, which I think was a lot better than people's expectations, as you look at your Wood Products manufacturing footprint, is there any capacity that right now isn't running that you think you will be bringing back into 2013?

We're operating all of our lumber manufacturing facilities today. We're operating all of our OSB facilities. They have -- they are not running 100%. So they have some capacity potential. In our engineered wood products facility, we still have some mothballed facilities. The operating rate in our engineered manufacturing operations is lower than it is with OSB and lumber, and so we have the ability to ramp up production in order to meet demand in the near-term. And we have no announcements at this point nor we have made any decisions about when to bring back shutter capacity.

Okay, understand that. And then as you're going to go through your budgeting process for next year, would you be able to share what housing starts number or a relevant range for housing starts number that you would expect PTUs [ph] as you think about budgeting within the Wood Products business next year?

We will share that on our next call at the beginning of the year. So we're tracking a number of outside forecast. The ranges today for 2013 from third-party forecasters that we track range from about $900,000 up to as high as $1.2 million. We'll have a better handle on that at year end and then we will share with you what we are using for planning purposes and that will help you calibrate perhaps what we're expecting to be delivering in our Wood Products business, our Timber business and homebuilding.

Your next question comes from Gail Glazerman with UBS.

I was wondering if you can talk a little bit about Southern sawlog markets. So we've seen a reasonable pickup in housing activity, wood product prices are up, but it doesn't seem like there's much traction in terms of log prices. I'm just wondering, what do you think is holding that back and what it will take to start to see a pickup in turn there?

I think it will be consistent, steady demand. And we would expect some pickup in response to increased activity. It continues to be a regional market, Gail, as you know, and so it starts pickup generally. There's opportunities in the marketplace to manufacture more in certainly our Wood Products facilities as well as third parties. And I just think it's going to be continued uptick in demand that will tension the market then you should start to see some movement.

Okay. And then in terms of homebuilding activity, when you look at kind of the sales activity that you're seeing, is the mix of business what you would expect to be normal, aside from the affordable housing issues that you're having in the fourth quarter? But I mean, are you seeing kind of the new homebuyers versus the mix you'd expect of new homebuyers versus move-up buyers, et cetera, that you would be expect in kind of a more normal housing market?

We are. I mean, we sell to a broad range of customers. The activity that I talked about this morning in the Inland Empire has been reassuring for us because that market has been very slow, and so we've seen a steady increase in activity, and I think we found a sweet spot in terms of price and product for that market. So that's a first-time buyer product. In some of our other markets, we've seen move-up activity being stronger. Las Vegas is a market where we've had some real success in move-up housing. So I would say it varies by market. We're not seeing any noticeable long-term shifts in demand in terms of the kinds of homes and the kinds of features. We're all focused on affordability, and we're focused on getting homebuyers confident again to go back into the marketplace. And so we're starting to see that activity and each of our local markets are responding with new product that meets the needs of today's buyer. Not seeing any significant long-term shifts at this point.

Your next question comes from Mark Weintraub with Buckingham Research.

Do you have a sense yet as to what your pension expense might be looking if rates, discount rates stay roughly where they are for next year versus this year?

Mark, we'll be going through those calculations here shortly. We really haven't finished that work up yet, so I really don't have anything to share at this point, but we will be going through that on our fourth quarter call.

Okay. If I could add one more. Do you -- I know last year, you had a pretty big increase in the amortization of actuarial loss that went up by, I think, about $70 million. Does that stabilize this year or does that also go up again this year?

I have not gone through that computation, so I would just be speculating, sorry.

Okay. And then real quick, so the lumber panels, you mentioned you're operating at kind of 80%, 85%, if I caught you right.

Yes.

Okay. The types of housing starts increased, particularly the upper end, that some of the forecasters are talking about, would potentially imply that, quite frankly, you would struggle to meet all the demand and maintain market share. Am I missing something there? And what can you do? Is there flex in your system now where you can meet that higher demand if need be fairly quickly?

We have flex in our lumber business because we have the ability to add hours and ultimately, if demand is sustained, to add some shifts. And then there is -- we have continued to make improvements in the productivity in the throughput in the mills that we do have. Our OSB mills have some flex capacity as we ramp up. And what we'll do is focus on serving the markets where we optimize our margin with longer-term relationships and we optimize our strategic advantages. So I would say we're looking forward to the opportunity to challenge ourselves, Mark, with that increased activity.

Yes, especially as we look at our lumber system, Mark, we do have the ability to do some debottlenecking across the system as the demand picks up. So we're looking at the ability to do that first with noncapital solutions and then obviously, to the extent that there are other capital things that would give us some additional capacity that we have in front of us, we'll be looking at doing that as well.

Your next question comes from Steve Chercover with D.A. Davidson. Steven Chercover - D.A. Davidson & Co., Research Division: Just wondering, I actually missed your discussion of how many lots you had. I think you said 27,000 within WRECO and you had a big position in Nevada, which I missed.

Yes, so what we said was that we have control of about 27,000 lots in our primary markets. Those are lots that are intended for our own homebuilding operations, as well as for sale to other builders. Of those lots, roughly 80% are owned and 13% are optioned. And then additionally, we control about 67,000 lots in a large master plan in Nevada. And that is a project that -- where we put the development and construction on hold, depending on improvement in local market conditions. The majority of those lots are held under a long-term option and the value of that particular property is based upon its development rights, and in particular its water rights. When you look at our lot position, we have always sold some portion to third-party builders. And what that gives us is a tremendous amount of optionality because we can choose to shift the mix between what we build and what we sell. So in general, about 25% of the lots that we control have been targeted for sale to the third parties, but we do had the ability to shift that mix depending upon opportunities in the marketplace. The length of our lot type line varies by market based upon local entitlement conditions. So we have a much longer position in a place like California where entitlements are very difficult, and a short position, in a market like Houston, which has no zoning and one can go through the process relatively quickly. And in some markets, we are developing the majority of our own lots and others. We continue to purchase lots from third-party land developers. Steven Chercover - D.A. Davidson & Co., Research Division: So the 27,000, are those basically shovel-ready? And how would that compare to your target inventory in a normal housing environment?

They are not all shovel-ready, but they are -- we control them and we have some level of entitlements. And what we do is we manage the development of these properties so that we're not investing in a lot of infrastructure earlier than we need to. So we're comfortable with the position that we've got. As the market picks up, we will continue to perhaps move the location of the lots around and the investment in lots, but that's an ongoing process based upon local demand and local opportunities. Steven Chercover - D.A. Davidson & Co., Research Division: Could you just remind me the time lag between when a home is sold and closed?

Well, that varies. So in some cases, we have finished homes. Houston is a market, for example, where we historically have built homes on a speculative basis because there is a large group of buyers in Houston that are relocating there, primarily in the energy business. And when they come to town, they need to buy a house. And so that house needs to be ready to move in, in probably a couple of months. If it's a completed home and if we sign a contract, in today's market, it's likely 60 days to go through that processing for a mortgage. And then the other extreme would be a pre-sale, which we do in most of our markets where we have a model complex, a buyer comes in, they sign a contract and then we build the house and the construction timeframe can run from, say 90 days to 6 months, depending upon the complexity of the house and the finish and ultimate price range and then you'd add the closing timeframe to that. So if it's a pre-sale, the homebuyer's going through the mortgage qualification process while the home is being built.

Your next question comes from Joshua Barber with Stifel, Nicolaus. Joshua A. Barber - Stifel, Nicolaus & Co., Inc., Research Division: Again, sorry to beat the homebuilding issue to death, but just one quick question there. Can you tell us what your community count is on the WRECO side and how that's changed over this year and also on that, where you envision that going, I guess, in 2013?

The community count for WRECO is down just a bit this year. And so what is happening in the homebuilding business at all times is you're continuing to open new communities, you're closing out new communities. Total community count today for us is 66 and we would expect that to be increasing next year. One of the things that we have focused on, especially over the last 2- to 3-year period is the sales per community. So we have focused on increasing the effectiveness and the productivity of every one of our communities to the point that today I think, based upon our data, we've got the highest number of closings per community of any public builder. Joshua A. Barber - Stifel, Nicolaus & Co., Inc., Research Division: And are you seeing credit trends among new homebuyers today or existing homebuyers, are using that going down the credit curve, so to speak, or is it still mostly in people with very high FICO scores, people that could get mortgages much easier? Are you starting to see some thawing of credit?

Still very high FICO scores. Mortgage qualification process is challenging. We're still waiting for a definition of qualified residential mortgage through the consumer product protection bureau and also coming out of Dodd-Frank. That's an issue that needs to be addressed in the industry. Right now, the initial proposals continue to be for a 20% down payment. I think that's too difficult. And there needs to be some moderation and the pendulum swung very far to tightening credit, and I think that longer term, we need to see some moderation in that process.

Your final question comes from the line of Paul Quinn with RBC Capital Markets.

Just 2 questions on Wood Products. You obviously saw OSB prices jump in the 2012 here and they seem to remain high. How do you see about the -- what do you think about the sustainability of that market? And then also on lumber, although it's come up, we're still below long-term averages. Just your future sort of view on that pricing dynamic as well?

I'll take lumber first, Paul. I mean, we take the long view on lumber and look at total projected North American starts, both U.S. and Canada. And we look at the relationship that we have with lumber that has historically come from Canada. We would expect demand to be increasing as the market recovers and we would expect a healthy environment for lumber. I can't project future prices. With respect to OSB, the market has been tight. Most operators are producing at relatively high levels. As I mentioned earlier, when the new starts number came out last week, it was evident that the supply channel was pretty thin. And so I think that's what's been helping OSB prices and we would expect that -- we've got a long way to go in this recovery. As I mentioned, today's levels are still very, very low compared to historic starts numbers and long-term trend numbers, and so we're bullish on the long term. Okay. Well, thank you for all of your questions. We appreciate you joining us this morning on the call. We especially appreciate your continued interest in Weyerhaeuser Company. If you have further questions following today's call, I encourage you to follow up directly with Kathy McAuley, and I thank you all for joining us this morning.

Thank you and have a good day.

Thank you for your participation. This concludes today's conference call and you may now disconnect.