November 27, 2007 in Business

Logging plans lag amid low timber prices

Associated Press The Spokesman-Review
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A worker releases the choker set from a group of logs dragged uphill to a logging road in Oregon. Associated Press
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PORTLAND – Bush Administration plans to boost logging in Northwest national forests have collided with low timber prices blamed on the housing slump.

The U.S. Forest Service is running short of money to draw up new timber sales.

Government and industry officials say lumber prices are as low as they have been in years, down by about half from the peak in 2004.

Thus the Forest Service earns far less for timber, meaning less money for future logging projects.

“We didn’t know this was going to happen,” said Peggy Kain , of the Forest Services regional office in Portland. “The market hasn’t been this bad in a very long time.”

Some mills are cutting back production.

“It’s probably as bad as it’s ever been, maybe worse,” said Kevin Binam, of the Western Wood Products Association.

Without more federal funds, forest experts say, national forest logging will drop off again, hampering efforts to thin crowded and flammable timber.

The Forest Service counted on some logging revenues, plus federal money, to pay for the accelerated logging.

The cash pays for plotting timber sales, environmental reviews and other preparatory work.

But the Forest Service didn’t anticipate the drop in timber prices.

Some Forest Service timber sales have gone without bids.

Reduced home construction, which consumes about 40 percent of Northwest lumber, depressed demand and prices. It’s unlikely to get much better before 2009, Binam said.

But other timber industry sources say there is Forest Service inefficiency. The Forest Service proposes small timber sales where loggers cut only thin, scattered trees that don’t have much value, said Chris West, of the American Forest Resources Council, an industry group in Portland.

He said the agency is not moving aggressively to thin overgrown forests at risk of wildfire and salvage burned timber.

Cutting higher volumes makes timber sales more profitable.

Protections for the northern spotted owl and other wildlife ended intensive national forest logging in the late 1980s.

But the Bush administration pledged to try to increase logging to levels outlined in the Northwest Forest Plan drawn up by the Clinton administration to protect wildlife while turning out a reliable supply of wood.

National forests never met the goals, in part because of environmental lawsuits for lack of money to plan enough timber sales.

But in April, the administration sent forests in Washington and Oregon an extra $24.7 million.

So regional forester Linda Goodman increased the region’s logging target from 600 million to 675 million board feet during the past fiscal year and set a goal of selling 800 million board feet this year and next year.

But some forest officials said that would be too much, too fast for now-smaller staffs, so Goodman dropped this year’s target to 750 million board feet.

The higher logging levels pale next to the 5 billion board feet or more of Oregon and Washington timber that the Forest Service sold some years in the 1980s.

But the Forest Service now has money to sell only about 625 million board feet.

The agency expected money from so-called trust funds, including one that collects a share of revenue from burned timber. But bids are not high enough to put much money into the funds, Kain said.

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