OTHER OPERATING COSTS, NET

12 Months Ended

Dec. 31, 2021

Other Income [Abstract]

OTHER OPERATING COSTS, NET

NOTE 19: OTHER OPERATING COSTS, NET

Other operating costs, net:

• includes both recurring and non-recurring income and expense items and

• can fluctuate from year to year.

Income and Expense Items Included in Other Operating Costs, Net

DOLLAR AMOUNTS IN MILLIONS
	2021			2020			2019
Foreign exchange losses (gains), net (1)	$	(5	)	$	7		$	2
Gain on disposition of nonstrategic assets		(3	)		(4	)		(4	)
Insurance recovery		(13	)		—			—
Litigation expense, net		7			11			63
Research and development expenses		5			5			6
Timber casualty loss		—			80			—
Other, net(2)		42			35			28
Total other operating costs, net	$	33		$	134		$	95

(1) Foreign exchange gains and losses result from changes in exchange rates primarily related to our U.S. dollar denominated cash and debt balances that are held by our Canadian subsidiary. 

(2) Other, net includes environmental remediation charges. See Note 14: Legal Proceedings, Commitments and Contingencies for more information.

INSURANCE RECOVERY

During fourth quarter 2021, we received a $13 million insurance recovery related to property damage and business interruption for certain of our mills in the southern U.S. as a result of severe winter storm damage in first quarter 2021. This recovery was attributable to our Wood Products segment and was recorded within “Other operating costs, net” in the Consolidated Statement of Operations.

TIMBER CASUALTY LOSS

In September 2020, forest fires in the state of Oregon, commonly referred to as the Holiday Farm, Beachie Creek, Riverside, and Archie Creek fires, spread from adjacent lands onto portions of our Oregon timberland properties. Based on interpretation of satellite imagery and aerial photography, as well as limited on-site assessments, we estimated that the fires affected approximately 125 thousand acres of our Oregon timberlands. Our assessments indicated that the extent of damage varies from tract to tract based on topographical conditions, rate of fire spread, age of the timber and other circumstances. Based on these assessments, we expected that the majority of merchantable timber, even if affected by the fires, is likely salvageable if harvested within a reasonable period of time. We believe the majority of pre-merchantable timber affected by the fires will not be able to be salvaged.

In third quarter 2020, we recorded a timber casualty loss of $80 million which represented the estimated book value of timber and related assets that could not be salvaged based on information available at that time. The loss was attributable to our Timberlands segment and was recorded within “Other operating costs, net” in the Consolidated Statement of Operations. As of December 31, 2021, we have harvested a substantial majority of our planned salvage volume in Oregon. The additional information obtained from our salvage operations has not resulted in a change to the estimated loss previously recorded.