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Est. 1998 — 27 years of woodworking knowledge

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It's incense now. The smell you get sharpening a pencil is incense cedar and not any other part of the pencil.
I made some pencils a few years ago, and Warren mentioned that red cedar had also been used - how long ago? i don't know.
Sort of a weird sensory experience cutting incense cedar to make pencils because you're just working wood, but it sounds like there are four hundred people sharpening pencils in your shop at the same time.
Make that "smells" like!