Tag Archives: Bureau of Land Management

AFRC: Timber seeks injunction barring contract suspensions

Timber seeks injunction barring contract suspensions

October 16, 2013


By American Forest Research Counci
l
Timber Industry Seeks Injunction Barring Federal Government’s Suspension
of Timber Contracts

Purchasers of federal timber sales and stewardship contracts filed suit yesterday against the Forest Service and the Bureau of Land Management (BLM). They are asking the Oregon Federal District Court to enjoin the agencies from suspending timber contracts during the government shutdown.

The American Forest Resource Council (AFRC), an industry trade association, joined an action brought by Murphy Company, High Cascade, Inc. and South Bay Timber, LLC.

“It makes zero sense for the cash strapped government to shut down operations that pay millions into the United States Treasury,” said Tom Partin, President of AFRC. “These companies employ loggers and truck drivers that need to be making money to feed their families. Getting logs out of the woods and into mill decks is especially important at this time of the year. Otherwise, these companies won’t be able to operate through the winter.”

Under contract law, the government cannot summarily stop timber operations. Contractors operate under harvest plans already approved by the agencies before ground work begins. As long as critical inspections are not needed, they can continue to work. Scheduled payments are made electronically, similar to those made by businesses making quarterly income tax payments.

“One of the purposes for these contracts is to improve forest health and reduce fuel for forest fires and protect federal and adjoining property. Issues of public safety in campgrounds and along roads are involved. Shutting down operations means these objectives won’t be met and things will get worse,” Partin said.

“A timber operation isn’t something you can turn on and off like a light switch. Once equipment has to be moved out, it can be months before it can be moved back in. For example, operators have waited through the fire season for helicopters to be available. If they can’t fly, they will start work on private contracts and it could be another year before they can come back. Meanwhile, downed timber rots on the ground,” Partin said.

“What is happening to our members is particularly frustrating when other businesses with contracts to operate on federal land, such as ski areas, are being allowed to continue working,” Partin said.

The National Forest System includes approximately 190 million acres of public land throughout the United States. The BLM administers approximately 264 million acres of public lands. A blanket, unwarranted suspension of revenue-generating timber operations on these vast acres will have a devastating effect on individuals dependent on the timber industry and will exacerbate the impact of the government shutdown on the nation’s economy.

Murphy Company employs over 500 people in its manufacturing facilities in Oregon and Washington. Timber from Forest Service and BLM contracts supplies over one-third of the raw material needs of its Oregon plants. High Cascade purchases timber from the Gifford Pinchot, Mt. Hood and Ochoco National Forests to supply mills in Carson, Washington and Hood River, Oregon. South Bay Timber currently has cutting rights under four stewardship contracts with the Forest Service and BLM on which it employs about 40 people.

AFRC is a regional trade association representing some 60 lumber, plywood and wood products manufacturers in California, Idaho, Montana, Oregon and Washington. Its members utilize public timber in their manufacturing operations. In many areas where its member mills are located, the national forests are a significant source of timber supply because there are few private lands.

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Wood products find floor

Wood products find floor

Timber Industry Report

By Rick Sohn, PhD
Coquille LLC

A correction in wood products seems to have found a floor, interest rates are trending down, and real estate activity continues at a healthy pace, despite slower starts. Seven-year trend of lumber, logs, housing, and mortgage statistics are shown below.

chart-sohn-aug13

Interpretation
Last month falling lumber and log prices, and rising mortgage interest rates were highlighted. This month, a negative trend in Housing Starts and Building Permits continues and we are now back down to later 2012 levels.

Monthly average mortgage interest rates are still headed up, and July will report 4.37% rate. The most recent week does show a dip to 4.31%.

Wood products prices seem to have found a floor. Not only studs, but according to Random Lengths, Oriented Strand Board prices fell 41% in the second quarter, before finding a floor. This is the sharpest single quarter decline for OSB in the last 17 years, since these records have been kept.

Log prices have not fallen as far, so there is more squeeze on the wood products producers.

This is a year of serious forest fires in the Southern Oregon area. 35,000 acres have burned in Douglas County as of this report. This represents a mix of private industrial timberland and Bureau of Land Management lands, perhaps 10-15,000 acres of private industrial land. A lot of the industrial land is covered with reproduction forests that are not merchantable. These stands will represent a total loss.

To the minor extent that there is merch timber, rapid salvage can be expected from private lands. There is not likely enough merch timber to affect log prices, as substitution from planned logging by industrial producers will occur. The BLM lands, in contrast, are likely dominated by a forest of merchantable timber. Barring the effects of a recent court case supporting logging on BLM O&C lands, salvage logging, is not likely, even though it would be desirable for forest recovery and the economy.

In the meantime, home sales do not seem to have slowed much, and real estate sales statistics remain positive and improving. Unsold inventory in Portland, while up slightly, is still below 3.0%. And, the median US home value continues to increase.

According to Roseburg Prudential Agent Janet Johnston, agents are busy with lots of activity, despite the uptick in interest rates, which are still excellent for most people but might affect the ability of a few buyers to purchase. Some buyers will have to lower their expectations of what they can qualify for. Most activity is still in the $250,000 and under range, although there are now some pending sales in the $600-$800,000 range. Carol Johnson, a G.Stiles Realty agent in Roseburg is also reporting an increase in showings in the above-$600,000 price.

Data reports used with permission of:
1-Random Lengths. Through Sept. 2012, 2”x4”x8’ precision end trimmed hem-fir stud grade from Southern Oregon mills. Starting Oct. 2012, consolidated with Kiln Dried Studs, Coast Hem-Fir 2x4x8’ PET #2/#2&Btr. Price reported is Dollars per Thousand Board Feet, generally the third week of the month. One “board foot” of product measures 12 inches by 12 inches by one inch thick.
2–RISI, Log Lines. Douglas-fir #2 Sawmill Log, Average Region 3 Southern Oregon price, reported in Dollars per Thousand Board Feet of logs, Scribner Scale. The standardized Scribner Scale includes expected saw trim waste, so a log board foot is much more wood volume than a product board foot.
3– Dept. of Commerce, US Census Bureau. New Residential Housing Starts and New Residential Construction Permits, seasonally adjusted, annual rate. Recent reports are often revised in bold. Also, major revision made each May, reaching 2 1/2 yrs back.
4–Regional Multiple Listing Service RMLSTM data, courtesy of Janet Johnston, Prudential Real Estate Professionals Broker, Roseburg, OR. Inventory of Unsold Homes (Ratio of Active Listings to Closed Sales) in Portland, Oregon, for most recent month available.
5–Freddie Mac. Primary Mortgage Market Survey. 30-year Fixed Rate Mortgages Since 1971, national averages. Updated weekly, current report is for the prior full month.
6–Mortgage-X Most recent weekly rate of 30-year Fixed Rate Mortgages, national average.
7–Zillow.com Median value of homes sold in the United States during the month, weighted according to each area population. The Median removes the effect of outlier expensive homes, with equal numbers of homes above and below the median value each month. Revisions in bold
Issue #6-7. © Copyright Rick Sohn, Umpqua Coquille LLC.

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Wyden-Merkley pressed on forest bill

Wyden-Merkley pressed on forest bill

May 1, 2013

Forest Industry Urges Comprehensive Solution for Federal ForestsAFRC
–Requests that Wilderness Legislation Not Advance Separately
American Forest Resource Council,

A group of forest products industry associations sent a letter to Oregon Senators Ron Wyden and Jeff Merkley urging enactment of a meaningful legislative resolution to the paralysis affecting federal forest management in Western Oregon.

The American Forest Resource CouncilAssociated Oregon LoggersDouglas Timber Operators and Southern Oregon Timber Industries Association sent the letter in advance of a hearing of the Public Lands Subcommittee of the Senate Energy and Natural Resources Committee scheduled for April 25, 2013 to consider a number of public lands bills. Among them is the “Oregon Treasures Act of 2013” (S.353) which includes the proposed Wild Rogue Wilderness and Molalla Wild and Scenic Rivers designations. The Senate Energy and Natural Resources Committee is chaired by Senator Wyden.

“Our industry is opposed to the passage of these proposals, as well as other Wilderness areas proposed for Western Oregon, unless they are coupled with, or preceded by, the enactment of a meaningful legislative resolution to the paralysis affecting federal forest management in Western Oregon,” the letter states.

The letter notes last week’s closing of Rough & Ready Lumber Company, the last sawmill in Josephine County, where the unemployment rate is 11.6 percent and the average poverty level is 17.8 percent. The mill closed for lack of timber supply from nearby federal forests managed by the Forest Service and the Bureau of Land Management (BLM). The BLM managed Oregon and California Railroad Grant Lands (O&C Lands) grow over 1.5 billion board feet to timber per year, but recent timber sale levels have been well below 200 million board feet. In fact, in 2011, the total timber volume awarded by the BLM was only 137 million board feet. Harvesting on Forest Service lands remains well below the drastically reduced levels called for in the Northwest Forest Plan.

“This very real crisis, not additional Wilderness designations, should be a priority issue for the Senate Energy and Natural Resources Committee,” say the letter’s authors.

The letter references a March 19, 2013 opinion piece in the Oregonian in which Senator Wyden wrote, “with cooperation from stakeholders on all sides we will have a solution that works for all of Oregon” and “that solution must increase timber harvests and economic activity on some lands while permanently conserving others.”

The letter concludes by expressing the hope that Oregon’s Senators will join Oregon delegation members Representatives Peter DeFazio, Greg Walden and Kurt Schrader and Oregon Governor John Kitzhaber in their efforts “to find a true, lasting solution for Oregon’s federal forests and rural communities.” The O&C Trust, Conservation and Jobs Act, a draft bill supported by the majority of Oregon’s House delegation, contains provisions for both forest management to produce jobs and revenue for counties and for permanent conservation of areas included in S. 353.

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AFRC: Lawsuit Filed to Overturn Latest Spotted Owl Critical Habitat

Lawsuit Filed to Overturn Latest Spotted Owl Critical Habitat

 March 25, 2013

Oregon Timber Industry Comments on Senate County Payments Hearing and Outlines Real Solutions

By American Forest Research Counci

The American Forest Resource Council joined the Carpenters Industrial Council, Siskiyou County, California, and a group of forest products manufacturers and private forest landowners in a lawsuit to overturn the latest Northern Spotted Owl critical habitat designation. The case was filed in federal District Court in Washington, D.C., against the Secretary of Interior and the Director of the U.S. Fish and Wildlife Service.

“We just don’t understand why the Fish and Wildlife Service persists in writing rules that hurt the folks living in our rural communities, while doing very little to help the species they are trying to protect,” said AFRC President Tom Partin.

“Habitat is no longer the limiting factor in the owl’s survival. The real threats are barred owls and wildfire. This rule does nothing to address these threats and in fact will make our forests more prone to wildfire.”

The final critical habitat covers 9.29 million acres of mostly federal forest lands and 291,570 acres of State of Oregon lands, nearly double the 5.3 million acres designated in 2008. The proposal will have a significant impact on forest management throughout the range of the northern spotted owl in Oregon, California and Washington.

Of the acres identified in an earlier critical habitat designation in 2008, over 1,160,000 acres (22%) were inexplicably not included this year. The new rule designates 57% (1,270,000 acres) of the Oregon and California Railway Grant lands (O&C lands) managed by the Bureau of Land Management. BLM biologists consider 42% of those designated acres not to be suitable spotted owl habitat.

“Although the new rule implies that ‘active forest management’ will be permitted within the critical habitat boundary, the cost to agencies of consultation and of obstructionist environmental lawsuits make this a hollow promise,” said Partin. “We are already seeing this in a lawsuit filed against a project on the Shasta-Trinity National Forest in California.”

The designation makes it necessary for federal agencies to consult with the FWS before conducting management activities. This will have the effect of further curtailing timber harvest on public lands, with a consequent impact on revenues to counties from public timber sales. The milling infrastructure throughout the West will be negatively impacted by a tightened supply of raw material and an increased cost for what logs are available. This is likely to lead to fewer shifts and even more mill closures, eliminating the living wage jobs of mill workers in rural communities.

“Put simply, we expected better from an agency that is required to use the best available science and also balance economic harms when making decisions regarding endangered species. This rule is plainly illegal,” said Partin. “The fact that our filing with the Court exceeds 100 pages tells you how serious and extensive the flaws are and how important it is to get this turned around.”

The rule was published in the Federal Register on December 4, 2012 and became effective January 3, 2013. AFRC submitted extensive comments on the draft rule, as well as information from the National Council for Air and Stream Improvement and Western Ecosystems Technology, Inc. explaining the deficiencies and flaws in the draft rule. Those deficiencies and flaws were not corrected in the final rule. AFRC is suing to stop violations of the O&C Act, the Forest Land Planning and Management Act, the Endangered Species Act and the National Environmental Policy Act.

The American Forest Resource Council represents forest product manufacturers and landowners throughout the west and is based in Portland, Oregon. www.amforest.org

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Ore Timber groups on Senate payment plan

Ore Timber groups on Senate payment plan

March 21, 2013

Oregon Timber Industry Comments on Senate County Payments Hearing and Outlines Real Solutions

By American Forest Research Council

The Senate Energy and Natural Resources Committee is holding a hearing in Washington, DC today entitled “Keeping the Commitment to Rural Communities” to review the Secure Rural Schools and Community Self-Determination Act (SRS) and Payments in Lieu of Taxes (PILT) county payment programs.

Tom Partin, President of the American Forest Resource Council (AFRC), is urging Oregon Senator Ron Wyden, who chairs the Senate Energy and Natural Resources Committee, to take action on meaningful solutions to restore active, sustainable forest management to Oregon’s Forest Service and BLM O&C forests.  The data suggests that relatively modest timber harvest levels could generate county payments significantly higher than those expected from SRS while also providing thousands of new jobs in rural Oregon.

“If the federal government is truly interested in honoring the nation’s commitment to Oregon’s rural, forested communities it will promote real solutions to restore the health of our forests and the vitality of rural communities through balanced, sustainable management of our federal forests,” said Partin.  “Merely doling out dwindling Secure Rural School payments clearly falls short of meeting the needs of local governments and does nothing to generate the private sector employment these communities so desperately need.”

Beginning with “Spotted Owl Guarantee Payments” in the early 1990’s and continuing through today with SRS payments, Pacific Northwest counties have received billions in often deficit spending subsidies from Washington, DC when all they’ve asked for is the sustainable management of the federal forests in their backyards.  Secure Rural Schools payments have declined significantly in recent years and many Oregon counties receive less than half of what they received as recently as 2008.  Rural Oregon now faces chronic unemployment, record food stamp use and insecurity from an underfunded law enforcement and criminal justice system.

Last month, Oregon Congressmen Peter DeFazio (D), Greg Walden (R) and Kurt Schrader (D) wrote Chairman Wyden asking that he convene a hearing to explore lasting solutions for Oregon’s Bureau of Land Management (BLM) Oregon & California Grant Lands forests, including their O&C Trust, Conservation and Jobs Act.  The bipartisan House proposal would permanently protect all of the old growth on BLM lands while managing the remainder of the land on a sustained yield basis to provide over 500 million board feet of timber, over 5,000 jobs and $165 million to the counties every year into the future.  The harvest level called for under their proposal represents less than half of what these forests grow each year.  Oregon Governor John Kitzhaber has also called upon the entire Oregon Congressional Delegation to promote this type of meaningful solution, but thus far Chairman Wyden has largely avoided addressing the issue.

“We hope Chairman Wyden will join his bipartisan House colleagues to develop real, balanced solutions for Oregon’s O&C counties,” continued Partin.  “Oregon Governor John Kitzhaber has also called for federal legislation providing lasting certainty for Oregon’s O&C counties, but if today’s hearing is any indication it appears that the Senate is inclined the kick the can down the road yet again.”

Meanwhile, AFRC has provided an outline of the modest harvest levels that would be required to generate county timber payments nearly double of those expected this year from Forest Service lands if Congress merely increased revenue sharing from 25% to 50% and reformed how a small portion of these lands are managed.  In addition to providing nearly double the revenue to local county governments this approach would generate tens of thousands of new jobs across Oregon’s hardest hit communities and provide additional receipts to the federal Treasury.

“The facts clearly show that you can provide significant revenue to local counties and schools as well as jobs in rural communities through the sustainable management of our federal forests, concluded Partin.  “In most cases the harvest volumes are less than the volume of timber that dies each year, a small portion of the annual growth and a minor fraction of the standing volume on our federal forests.”

The American Forest Resource Council represents forest product manufacturers and landowners throughout the west and is based in Portland, Oregon.  www.amforest.org

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Read of the Day: Lawsuit expands to lock-up 90 million bd-ft of timber

Lawsuit expands to lock-up 90 million bd-ft of timber

November 21, 2012

by Rex Storm, Forest Policy Manager
Associated Oregon Loggers

BLM Timber Lawsuit Impacts:  Previously reported environmental lawsuits attempting to stop Bureau of Land Management timber sales in Southern Oregon now appear to impact an even larger timber volume.  Environmental plaintiffs filed suit in US District Court to stop up to 25 BLM timber sales, and over 90 million board feet of timber harvest.  For every million board feet of timber harvested, 38 jobs/year are generated in Oregon’s economy.  If the lawsuits are not overturned, some 1,100 Oregonians would be threatened with under-employment during a three-year period.

Oregon Forest Sector Report:  A new 200-page report, The 2012 Forest Report – An Economic Assessment of Oregon’s Forest & Wood Products Manufacturing Sector, affirms that the sector is poised to grow creating thousands of new rural jobs—given improved markets and needed reforms to increase the public timber supply.  The report is published by Oregon Forest Resources Institute, which was created by Oregon’s Legislature to provide reliable public forestry information, and is funded by a portion of the timber harvest tax.  More information at: www.TheForestReport.org

Governor’s O& C Forest Panel:  In October, Governor Kitzhaber appointed a 14-member panel to develop a proposal that aims to legally authorize increased timber sale from half the Bureau of Land Management O&C forestland acreage, while generating sufficient timber sale receipts to replace lost county government timber revenues.  Beginning with a draft bill built by Oregon congressman DeFazio, Schrader and Walden, the panel must deliver its recommendation to the Governor and Congress by early next year.

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State timber economy ready to rebuild

State timber economy ready to rebuild

Created on Wednesday, October 17, 2012 | Written by Steve Law

Oregon’s timber industry should see some growth as national housing starts pick up, but don’t expect it to come quickly.

That’s the consensus of a three-person panel at the Portland Business Alliance’s monthly breakfast forum Wednesday morning.

“The consensus is that the demand globally for wood fiber is going to continue to increase, but it’s going to be slow, it’s going to be sporadic,” said Doug Robertson, longtime Douglas County commissioner.

“I think it’s going to be choppy,” agreed Andrew Miller, president and chief executive officer of Portland’s Stimson Lumber.

Joshua Prangley concurred. “I think it’ll be a little bit lumpy.”

He’s the vice president of basic materials investment banking for J.P. Morgan Chase in Chicago.

Despite signs of life in Oregon’s timber sector, it isn’t so easy for the industry to rev up after the protracted decline caused by the Great Recession.

Miller, whose company manages 500,000 acres of private timber land, said Stimson has had trouble getting logging contractors for the past three years, because so many left the field when demand disappeared.

“The whole supply chain shrunk,” Miller said. “It will take years in some cases to rebuild capacities.”

That extends even to the homebuilding industry, Prangley said. The nation lost 2 million construction jobs, he said, and many of those idled workers left for other industries.

It’s hard to reopen a wood products mill once it closes down, said Robertson, whose county, the heart of Oregon timber country, has seen the closure of about two-thirds of its mills in the past four decades.

All three panelists are skeptical there will be any significant increase in logging in national forests, given the propensity of environmental groups to challenge timber sales in court. However, they see a window of opportunity in a proposed bill that aims to shift control of 1.4 million acres managed by the U.S. Bureau of Land Management to the state of Oregon. Those are the so-called “O&C lands,” originally granted to the Oregon and California Railroad by an 1866 federal act as compensation for building a rail line from Ashland to Portland.

Oregon Congressmen Greg Walden, R-Hood River, Peter DeFazio D-Springfield and Kurt Schrader, D-Canby, are working on the bill. Gov. John Kitzhaber recently appointed a task force, including representatives of several Oregon environmental groups, to hammer out an agreement on the package.

The idea is that the state can better manage the timber lands in a sustainable fashion than the federal bureaucracy. In recent years, the timber harvest on state lands in Oregon has been in the same neighborhood as total cuts on federal lands, though federal lands are many times larger and account for half the land base in Oregon.

“I think we’re going to make some headway” with the O&C proposal, Robertson said.

Despite signs of revival in Oregon’s wood products industry, panelists cited trends that may shift control to non-Oregon companies.

“I get calls every week from investors wanting to buy timber land,” Miller said, citing an increasing appetite among outside investment funds.

He also foresees potential new ownership of the remaining privately held timber companies in Oregon when current families decide to leave the field. When there isn’t a younger generation in the family willing or able to take over the companies, Miller said, financial institutions in Boston and Chicago might step in and acquire local companies.

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