The last lumber mill in John Day, OR, is closing its doors. Malheur Lumber Co’s reasons, reported by local news, are shared by many small, rural communities:
1) Lack of a willing and drug-free workforce;
2) Lack of housing to recruit workers from outside the area;
3) Unfavorable market conditions for lumber in recent years;
4) High manufacturing costs due to inflation;
5) Low and inconsistent production due to workforce issues; and,
6) Continued layering of government regulations on small business in Oregon.
The workforce issues may be the most intractable as I see the same challenges play out in service-sector industries throughout our economy, e.g., senior/nursing care businesses. And don’t get me started on Oregon’s anti-business regulatory environment. But for computers, the amount of paperwork required could float a lot of forest sector jobs.
Thanks for sharing this, Andy. Needless to say, many of us in the local community are not giving up hope of coming up with solutions to keep the mill open. Without a workforce or wood processing infrastructure, it will make forest collaboration, wildfire risk reduction, and forest restoration meaningless.
I am so sorry. I am not surprised, but still a shame on so many fronts. As we look across the country, the west especially, we clearly see the results of the lack of forest maintenance. This announcement simply means things will get worse. What a shame. We know what to do to solve this national emergency.
Very respectfully
It would be great to get a full accounting of all federal funds that went to this mill since 2012. All of the money dumped into IRSCs, service contracts, and other means to funnel taxpayer funds to this business. And then compare to the number of acres treated.
This mill cried and threatened to close back in 2012 for the same reasons and several frequent commenters on this site were involved then.
Would’ve been cheaper for the feds to just buy the mill back then and operate it.
You bring up some really good points. I remember listening to the Timber Wars podcast by Oregon Public Broadcasting, which was excellent by the way. I believe it was in the last segment where they talked about John Day and the mill. I remember them saying that the mill had to hit rock bottom until they were finally willing to sit down with the other interests and discuss a path forward. It was presented as a success story.
The FS doing everything possible to keep a mill open is a familiar story to me. The IRSC’s are a way to keep pumping money into a mill operation but that can no longer make money the old-fashioned way. It is not really sustainable long-term. Politicians and others still somehow think the FS is generating lots of money from timber sales. I would like to see the trend. It is turning into more and more of an expenditure proposition.
You ask a good question, why keep trying to pound a square peg in a round hole and why not just go ahead and buy them out? Nationalize the mills and run a socialized timber program. The Forest Service wouldn’t have to try and please the mill owners anymore and the mill would be a tool for the FS to actually accomplish what it wants to get done.
Thank you for bringing up that this mill has been the subject of a lot of effort since 2012 – a lot of folks don’t realize that – and there was intervention by the Oregon Congressional Delegation as well. The Malheur NF stepped up and increased their timber outputs as part of the effort. A lot of effort was made, even though there was no guarantee that this mill would be the successful bidder on the sales.
That’s certainly some bad news; as already pointed out, forest restoration will grind to a halt. Not to worry though, the Malheur is a fire-adapted Forest, so the upcoming wildfires will certainly make those nasty old timber stands into waves of early-seral, scorched landscapes….. This ain’t another “if”, but “when”.
The leadership of the USFS owns some of this, that’s for sure…
Actually, the Forest Service worked very hard to staff up back in 2012 and that forest tripled its timber sale offerings (with no guarantee that this mill would be the successful bidder) in three years.
How how much of the western rural economic crisis is really the fault of FS employees?
The market is telling rural citizens to move to cities and get city jobs. The rural citizens are saying, with some consideable reason, wtf? No district ranger can solve this.
The leadership implicated is Chief level and Department! A DR can’t do squat anymore, it’s all about politics, group think and consensus. Hard to correct mistakes made decades ago, but instead of moving the outfit toward some semblance of correction, it continues to spiral downward!
The market forces and world economy will make it hard for any forest products industry to return to Eastern Oregon.
I agree that there are a panoply of greater forces at work here, and little the FS at the local level can do.
There seem to be lots of government programs that try to get city jobs to move to rural communities (in addition to growing remote work options). But also rural communities that don’t seem to welcome them.
Another Oregon mill is closing, this time in Toledo, a small town on the coast. The local newspaper quoted the mill manager, Walt Adams….
https://www.newportnewstimes.com/news/western-cascade-mill-in-toledo-closing/article_361856e8-4ece-11ef-b255-67854cd69bd3.html
‘Adams said the closure of the mill appears to be the result of a lumber market that has “just kind of been down across the board.” He added, “Just the way things have been going with the logs not coming in, it’s been looking that way for a while, but they’ve been talking like they’re going to keep going.”’
My guess is that the mill probably got most of its logs from private lands, but also the Siuslaw National Forest not far to the south. Maybe Jim Furnish can comment on the log supply in the area.
It’s entirely likely Malheur refuses to pay competitive wages but chooses to blame big gubmint for worker shortages instead. There are far, far better life choices than working in a sawmill for ten years let alone living in red counties where workers are commodities.
Oh Larry, you slay me (as my old Dendro instructor would say); I’ve spent about half my working career with the FS. Another half working logging, farming, road construction and in a sawmill. I can tell ya, none of the other jobs are easy to perform. As early jobs postings for the FS would say “the weak or in-firmed need not apply”, of course that was during Pinchot’s era.
My choice of leadership failures goes back to Howard Zahnizer, the father of modern Wilderness. All the FS would have had to do was to settle with the (then) Wilderness supporters for some small sections of ice and rock, to become Wilderness. But, hell no, we won’t settle with that bunch of non-believers, and the modern anti-logging groups were born!
It’s sad that few people really know how important it is to get work done. It’s not all modeling, paper shuffling and computers, somebody has to squirt the paint. After the FS began paying industry to log (right after the National Fire Plan of 2000), who could argue that this is much easier than having to actually work for a living. So now, we are paying (on average) 1.5 million dollars per hour to pay folks to stand around and watch forests incinerate.
Of course there much more to it than that, but it’s a great start!
So when are the mills in the Black Hills going to close, Mr. Zornes?
I don’t have that information, but it didn’t take a genius to see harvest levels were out of control. And to point, one has closed, one other is working reduced shifts.
The Black Hills was in a disastrous predicament until I got the $ for FIA to do extended sampling. 70,000 CCF should be the ASQ for an extended period. I don’t believe in “timber mining”….
Actually, ASQ probably needs to be down to about 40,000 CCF to be sustainable in the long term. This is due to the continued overcutting in spite of all the evidence. You tried your best in the limited time that you were here Jim, but this really came down to a failure of FS senior leadership that went on for years. Someone should write a book about what has happened here on the Black Hills. Future FS leaders should study this. Gifford would roll over in his grave if he knew what has occurred here.
I know a lot of people think that the Black Hills NF is a one-off, a place where there was more industry capacity than there was timber supply. The truth is that almost every National Forest with a timber industry highly dependent upon them for volume, is just one large fire and/or bug infestation away from being in the Black Hills’ shoes. Things are going along well and then in a short period of time, you have a timber industry crying for wood and blaming the FS, with the politicians jumping on and senior FS leadership that doesn’t have your back.
Man, Dave, the stories I could tell, but I won’t; needless to say I had some of my “darkest” times during that period, trying to figure out what I was missing. You are spot on in your assessment! Compromises made and broken, total failure of senior leadership (in so many ways), depleting resources for political gain, the list goes on and on. I’d never seen a unit with employee morale to the point of being ashamed to be associated with what was happening.
Fortunately, many, many working Forests are doing the right thing, making proud and environmentally sound decisions with the interest of all Americans at heart! In other words, living the Pinchot principles….
Dave, I tend to disagree with you.. there have been many large fires, Colorado, New Mexico, California, Arizona, and many many bug outbreaks in the western US. In the 80’s we had all kinds of dead lodgepole in Central Oregon and wished we had somewhere to mill them.. I remember the talk of a waferboard plant in Chiloquin. One of our silviculturists on the (then) Winema was thinking out of the box by suggesting one very wide fuel break around Chiloquin. Many places don’t have the timber industry crying for wood; or maybe they do but no one listens. I would bet it also has to do with how much industry can get from private land.. Oregon, lots, California, lots. NM and CO seem to have pretty minimal timber industry. That’s why many of us were glad to see Neiman buy the mill in Montrose.
If I had to guess, there/has been is a unique relationship between timber industry and politicians in South Dakota and possibly Wyoming. It seems to have been in place with pols of either party. And perhaps some unique tie to DC. For example, the call I was on during the Obama Admin, with CEQ telling EPA to to stand down for the condition-based bug project.
Ah, but I did have a qualifier! I said “almost every National Forest with a timber industry highly dependent upon them for volume.” Yes, the Black Hills is somewhat unique, I will grant that. The Black Hills timber industry was built around 200,000+ CCF that was only getting 20% of their volume from private land. Arizona, New Mexico and Colorado no longer have much of a timber industry. Until recently, the Black Hills NF carried the lion’s share of R2’s timber program. So, those States are not really a valid comparison. Oregon has a lot of industry and private land to fall back on. I think some of the Forests in California could easily fall into the Black Hills conundrum.
From what I understand, the situation with the Montrose mill is playing out in a similar fashion as the BH. The GMUG and the San Juan could easily get the Black Hills treatment down the road. Ask around. See if some of the Colorado NF’s aren’t afraid of getting the Black Hills’ crummy deal. Let’s see how that plays out.
I agree with your political assessment of South Dakota and Wyoming. That is part of the situation. Yes, Daschle was in on it too, back in his day. There is a difference between here and SW Colorado. Looking at how things played out with the GMUG’s plan revision, they had counties that wanted to lower the cut. That would never happen here. The political power of the Black Hills timber industry is quite amazing and most of us can’t figure out how they do it.
I love to generate hypotheses.. the people who move to different parts of the Western Slope (say Telluride or Crested Butte) I would guess maybe come from a different cultural background than people who move to or live in the Hills. So.. I would bet that there are more political contributions from people with a “no timber” way of thinking in SW Colorado. I’d say “cultural differences in people who live there and who have moved in” plus “large sums of money available to people with those inclinations, who spend it on politics, and also successfully run for office”.
I totally agree that is in play. When I was on the Kaibab, Flagstaff had a lot of those folks who had conversions when they saw big fires. The problem the GMUG and San Juan will have is their move to steep slope logging which is often ugly and of questionable benefit to fire mitigation. I don’t think the FS will score many points with those folks doing that.
This one, too, hits hard as it comes on the heels of Stimson closing their small-log mill in Plummer, Idaho and Pyramid Mountain Lumber closing their mill in Seeley Lake, MT. Not to mention Roseburg closing the particleboard mill in Missoula (although that one was slightly less surprising). Plus, the other recent closures in Oregon.
We need to stop treating these as isolated events and start looking at the larger picture: many of these announcements came without a dig at the Forest Service or other supply-side factors. Instead, Malheur and Pyramid and others cite workforce and workforce housing, along with lumber markets. I also get concerned when the conversation about mill closures shifts to replacing these mills with niche sawmills tooled for just small-diameter material. Not only would those mills have an even harder time turning a profit (economies of scale are necessary given the low overrun on small logs) but also smaller mills are less likely to purchase federal timber sales or be players in the stewardship contracting arena. Instead, we need to retain these mills and then invest in co-located businesses that can generate heat/electricity/and other co-products from the non-sawlog byproducts of fuels reduction and other forest treatments.
Maybe we need to think about forest products businesses like utilities: “low risk enterprises through which large amounts of financial capital can be deployed at low cost to build long-lived infrastructure” (quote from a Stanford Report on Climate change and utility wildfire risks: A proposal for a federal backstop)
You bring up some really good points here and I like your idea of treating forest products business like utilities. It’s time for some outside-the-box thinking. The old “doing the same thing over and over again and expecting different results” applies here.
The Sierra Nevada National Forests have had diameter limits and small log mills for over 30 years now. It surely isn’t optimal that SPI has a virtual monopoly in bidding on USFS timber sales, though. I doubt that there is any way to increase competitive bidding, either. I do like the idea of having Federal lumber mills, where needed, but I doubt that the courts would support that idea.
The current situation in the Sierra Nevada is that work has been getting done, over significant acres, but the pace and scale needed has never been funded. Additionally, some areas are too steep for conventional ground-based thinning projects.
Fires will burn, and I think we’ll have to focus on resilience, rather than prevention. As Frank Zappa wrote in the late 60s, “No way to delay that trouble coming every day”.
Chelsea, I wonder if considering them “wood waste repurposing facilities” would bring in different thinking and possibly funding sources. Instead of producing “material that they can sell at a profit” they would instead be (at least in parts of the West that need thinning) “industries to keep carbon out of the air”.. subsidized by climate NGOs or governmental organizations for that purpose. Products would be incentivized to substitute for maximally carbon intensive other products or energy..
What made me think of this a bit was the interview with Brad Worsley https://forestpolicypub.com/2021/07/09/support-renewable-energy-from-forest-restoration-guest-post-by-brad-worsley/
He’s talking about renewable energy production tax credits.. good for what he’s providing. But should there be tax credits for what people are removing.. like carbon. Today we have arguably questionable carbon credit schemes.. maybe instead of paying for trees that might burn up and release carbon, carbon credits could be authorized for “woody material to something useful” conversion.
For 40 years or so, it seems our smartest folks have tried to figure out how to make money from small material. Biochar here, bioenergy there.. and so on. Why hasn’t all this worked? That would be a great study for researchers I would think. Interview the people trying to do this and see what the obstacles are.. think of how much people pay to get rid of other kinds of waste.
There is general support for this kind of thing, at least in the Sierra, see this https://forestpolicypub.com/2021/08/09/i-woody-restoration-residuals-engos-in-agreement-background-and-sierra-letter/
Brilliant, Sharon. I think that is just the framing we need.
And on the latter point about the need to understand why all of these efforts have largely failed to solve the problem, well, I’m on that beat. Stay tuned. Perhaps the most interesting part of the research project will be talking to folks involved in businesses that attempted to find new models and uses for all this material and that did not make it. Of particular interest are the instances where policies were enacted to enable market development (e.g. 20-year stewardship contracts and haul subsidies) and they still failed.
On that note, if any readers have suggestions for particularly good cases to study, please reach out.