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Spokane, Washington  Est. May 19, 1883

Timber companies express hope

Stabilizing housing market bodes well for industry

Mark Williams Moscow-Pullman Daily News

MOSCOW, Idaho – Idaho timber companies say they are cautiously hopeful for an industry recovery in 2010 but admit it will be a slow one at best.

The industry bottomed out along with the rest of the economy in the fall of 2008, hitting the lowest point of what had been a four-year slide since the housing boom saw its peak in 2005.

“The fact is we finished 2009 at 554,000 (homes built). The last time we were that low was 1945, so we think that’s the bottom,” said Robert Bernhardt, spokesman for the timber trade group Western Wood Products Association.

“There’s been some encouraging signs in terms of foreclosures, and home prices have flattened or even picked up a little bit. That’s a key thing.”

Bennett Lumber Vice President Brett Bennett hopes those projections are true.

Almost exactly a year ago Bennett Lumber was forced to eliminate the night shift at its Princeton, Idaho, facility, causing a layoff of more than 30 of the sawmill’s 150 employees. The move was the last in a series of cutbacks the company has made in recent years due to a declining lumber industry that has been hit hard by the slumping housing market.

Some of those moves included workers taking two weeks off in late 2007 during a temporary shutdown, which was then followed in 2008 by a reduction in operating hours at the Princeton plant and an elimination of 45 percent of its staff at the Port of Wilma facility near Clarkston.

Similarly, Idaho Cedar Sales based out of Troy has scaled back production. General Manager Byron Cannon said the company also cut its night shift, leading to the elimination of 10 employees. Unlike Bennett Lumber, the company is more specialized, only producing cedar split-rail fencing and hand-split cedar fence pickets. Still, Cannon said production is off 30 percent from what it was just two years ago and particularly dropped off with the economic downturn in the fall of 2008.

“It’s affected everybody, and the pie has just been getting a little smaller,” he said.

Bennett said he hasn’t been able to add the night shift back, but the company has been able to maintain steady work for the day crew over the past year.

“We’re pretty confident and comfortable with our position and figured we would be OK after making the moves,” he said. “Hopefully things will come back up, and if things start to go back, heck, it might not be long until we put the night shift back on.”

Cannon is also hopeful that a night shift can be added again eventually. “We’re so blessed to be in an area that has a good, strong work force, and it’s a shame that we can’t keep it going,” he said. “If it was all goofballs you were going to get rid of that would be one thing, but when it’s key people it really hurts.”

Part of the reason for optimism may simply be because there is nowhere to go but up.

Bernhardt said the WWPA projects 34.5 billion board feet will be produced by the U.S. timber manufacturers in the coming year, 11 percent higher than 2009. That number is still 60 percent lower than the industry peak seen in 2005.

Whatever recovery is coming, it’s going to be slow, Bernhardt said.

“We’re anticipating Western lumber production will increase … which will end a five year decline,” Bernhardt said. “Mills will slowly start to come back, and certainly ones that have closed aren’t coming back, they’re gone, but those that are operating have learned to be very efficient and hopefully we’ll get a chance to show that.”

A slow recovery would be just fine with Bennett. He said the last few years have seen small swells of production based on a fleeting market trend, which then would disappear.

“We’ll get little flurries and then two days later it will drop down where it was,” he said. “We all just kind of watch each other and watch where things like foreclosures are. When the dust settles, then we’ll know where we’re going.”