Not out of the woods

Posted Feb. 27, 2009, at 6:56 p.m.
Last modified Feb. 13, 2011, at 11:01 a.m.

HOULTON, Maine — James Hogan was a logger at Louisiana Pacific Corp. for 21 years when he was first laid off in 2004. He spent four years scrounging odd jobs and selling personal property to keep solvent before getting hired as a woodloader at Treeline Inc. of Lincoln in July 2008.

The 46-year-old town man had almost recovered from that financial disaster, clearing $600 for a 55-hour workweek, when Treeline laid him off on Jan. 28. Since then, Hogan has searched for logging work from Fort Fairfield to Bangor without success.

“I am sitting home here doing nothing and it’s driving me crazy,” Hogan said Wednesday. “I am calling people I know, looking on the computer, doing everything I can, but there ain’t much out there.”

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Logging industry observers expect to see more laid-off loggers, and soon. Exact numbers are not kept, but state forestry officials estimated Friday that as many as 2,500 loggers work in Maine.

The worldwide recession, shrinking demand for new housing construction, plummeting newspaper and magazine markets and continuing constriction of the state’s papermaking and pulpwood industries are hammering loggers into the most severe downturn in their history, they say.

“If we were still paying the price for diesel that we were paying five or six months ago, we would not be in business,” said Sandra Brawders, executive director of Professional Logging Contractors of Maine, a lobbying organization that represents 176 logging and forest products companies.

“We are not getting hit as bad as the [Great] Lakes states. They were almost done back in December,” Brawders said, “but it’s still pretty bad here.”

The shrinking markets, she said, are forcing a commodities recession. It cuts so deeply and across so many industries that even woodsmen, who provide the forest products industries’ most fundamental element — and who are usually the most insulated against recession — are facing severe difficulties.

“I don’t think anybody has ever seen how quickly and how far the markets have collapsed,” said Keith Van Scotter, owner of Lincoln Paper and Tissue LLC of Lincoln.

“How bad it’s been depends on the type of market,” he added. “The paper markets are down 15 to 25 percent, the housing industry has been down for quite a while, and there’s been an unbelievable collapse in the pulp markets. Prices have gone down in pulp by 50 percent.”

Loggers traditionally have tailored their efforts to the broad needs of the state’s forest products industry. Yet those needs, like the industry itself, have shrunk. When sawmills and the housing market flourished, hardwood was the best crop. When that market died, paper mills and biomass energy producers that used pulp became the loggers’ best customers.

Then those markets plummeted.

“In October, over a period of a week or two, when the dollar became strong overseas and foreign pulp producers’ [product] became cheaper, it was like a switch went off,” said Brian Souers, owner of Treeline. “What had been selling well at a good dollar suddenly stopped selling at all at a poor dollar.”

“The mills have been working their butts off trying like heck to be creative running different products, but the bottom line is there’s just too damn much wood around. They don’t need it and they can’t sell it. So things are coming to a screeching halt,” Souers added.

There’s hope for new markets, Souers and Brawders said. As Gov. John Baldacci announced Tuesday, Old Town Fuel and Fiber will produce wood pulp for the papermaking industry and work closely with researchers at the University of Maine to develop new technologies for converting pulp-processing waste into a renewable biofuel.

The state’s wood pellet industry is another newcomer. Maine has only two large-scale pellet producers, according to the Pellet Fuels Institute, a nonprofit association that serves the pellet industry. Corinth Wood Pellets LLC is in Corinth and Maine Woods Pellet Co. is in Athens. A third company, Northeast Pellets, LLC, is lo-cated in Ashland.

“The wood they were able to take in has absolutely saved us,” Brawders said.

“But the pellet market is really small,” Souers said. “It must be under 5 percent of the whole market. It doesn’t hurt, but it doesn’t noticeably help.”

With at least two more pellet mills under construction or in the planning stage around the state, that might change, particularly if home energy prices soar as they did last winter.

In the meantime, Souers’ company will finish work by the end of March, instead of mid- to late April, when mud season, or the spring thaws, typically start. And instead of furloughing five to 10 of his workers during the six-week season, Souers expects that as many as half of his 50 workers will be laid off for two or three months.

“We will throttle back 20 percent of production. We were moving upward of 300 truckloads of wood last fall per week at the peak,” Souers said. “This summer I don’t think we will even do half that … Not in 30 years have I ever seen anything like this before.”

Nor has Hogan, who is looking for any kind of employment he can find.

“I have a couple applications in at the post office, Homeland Security at Fort Fairfield as a security guard. I am pretty open,” Hogan said. “I don’t want to flip burgers at McDonald’s, but if that’s what it comes to, that’s what I will do.”

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