News: New wood coalition, Ore. ethanol stimulus, EPA battle

By Rex Storm, Forest Policy Manger
Oregon Associated Loggers,

Small-Engine Industry Fights EPA Ethanol Rule: Boaters and small-engine-industry groups worry about engine performance problems, as the federal Environmental Protection Agency considers mandates that could dictate 15% ethanol in the nation’s gasoline.  The EPA has postponed a final decision on the ethanol mandate until next year.  Since retail gasoline with 10% ethanol (E10) is already mandated by Oregon State law, Oregon industry has joined others across the US to oppose any E15 federal “standard”.  Science fails to justify the negative consequences of ethanol mandates.

Federal Grant Helps Wood Ethanol: Lakewood, CO-based ZeaChem, Inc. announced it would receive $25 million in federal stimulus renewable energy funds, enabling it to complete a cellulosic ethanol plant at Boardman—a 250,000-gallon, $34 million bio-refinery began in November.  The company will begin making ethyl acetate by late 2010, by converting hybrid poplar fiber, forest waste and wood pulp into fuel.  GreenWood Resources Inc. operates a 17,000-acre hybrid poplar fiber farm near Boardman.  ZeaChem plans for future commercial-scale output of 25-50 million gallons/year.

Wood Manufacturers New Association: A new, national coalition will be launched Jan. 2010, which will lobby for the common interests of wood product producers.  The “American Wood Council” will address building codes, green building standards, and regulations impacting forest product manufacturers.  The Council has 40 member firms & associations, representing 50% of softwood lumber output, 70% of structural panels, and 60% of engineered timber.  AWC wants to ensure a unified voice for wood manufacturing, which guides future wood product policy.

Healthy Forests Legislation Introduced in Congress: On Dec. 8th, a bipartisan group of US House members, including Reps. Greg Walden (R-OR) and Kurt Schrader (D-OR), introduced two bills to promote healthier federal forests, renewable biomass energy production, and rural economic development.  The Healthy Forests Restoration Amend Act (HFRA II) would provide needed clarification to the 2003 Healthy Forests Restoration Act.  The Incentives to Increase Renewable Biomass Act would encourage government buildings to convert to biomass heating systems.

Hampton Buys Warrenton Mill: Portland-based Hampton Affiliates announced its acquisition of the Weyerhaeuser Co. Warrenton sawmill, near Astoria.  Hampton CEO Steve Zika said the mill would be temporarily shut for 12-months, to install mill upgrades.  The hemlock sawmill currently employs 94 workers, not including 46 laid off in March.  Hampton owns eight sawmills with capacity of 2 billion bdft, 100,000 acres of timberland, and employs 1,500 in OR, WA and BC.  The acquisition demonstrates Hampton’s interest to continue manufacturing lumber in NW Oregon.

Murphy Acquires Idled Rogue River Mill: Eugene-based Murphy Company has agreed to purchase Panel Products’ idled plywood mill in Rogue River, located east of Grants Pass.  After the $3.6 million purchase is completed, Murphy plans to restart the mill early next year.  Long-time plywood manufacturer, Murphy also has plants in Eugene-Springfield, Sutherlin and White City.

TP Shuts White City Plywood: Timber Products Co. announced it would indefinitely close its White City plywood mill, effective Dec. 1.  Timber Products plans to consolidate softwood plywood production at its Grants Pass plant.  The fate of the White City mill depends on market conditions.

Weyco Becomes Real Estate Trust: Federal Way, WA-based Weyerhaeuser Co. announced that by the end of 2010 it would convert its legal status to a real estate investment trust (REIT).  Weyco officials said that conversion would make its timberlands more competitive.  Due to federal tax advantages, most other US timber firms have already separated their timberlands into timber investment management organizations (TIMO).  Weyco is able to create a REIT for its mix of timberlands, wood products, paper and real estate.  Weyco expects 2010 revenues to total $6 billion.

John Day Pellet Plant:
As a needed boost to Grant County’s economy, Ochoco Lumber Co. announced it received $4.89 million in federal “stimulus” money to help build a wood pellet-making plant in John Day.  Ochoco plans to have the 11-employee plant running by Sept. 2010.  State government economists boasted that the project “allows 80 full-time jobs to be retained;” an exaggeration obviously to justify the Democrat-led government spending.  The plant plans for bulk delivery to commercial fuel pellet heating boilers across the Northwest.

Interior Paper Mill Shutdown: With the announced Dec. 31st permanent closure of Smurfit-Stone Container’s Missoula, MT pulp & paper mill—the Interior’s largest pulp mill, there remains just four pulp mills in the Interior Western US—Potlatch in Lewiston, ID, Inland Empire Paper in Millwood, WA, Ponderay Paper in Usk, WA, and Boise in Wallula, WA.  Closing Stone’s Missoula plant lays off 417 workers, and eliminates at least as many supplier and contractor jobs.

BLM Timber Purchasers Seek Contract Improvements: Oregon timber purchasers meet periodically with BLM district managers at a statewide gathering.  At their November meeting, hosted by Douglas Timber Operators and Amer. Forest Resource Council (AOL a member), AOL staff and other industry foresters implored BLM managers to improve cost-effectiveness of current and future timber sale offerings.  Needed improvements suggested ranged from reducing high-cost contract restrictions, increasing volume/acre cut, to favoring purchaser-select tree designation.

Elliott State Forest Plan: Oregon’s State Land Board met in December to consider improving it forest management plan for the 93,000-acre Elliott State Forest, located in Coos County.  The Land Board heard a number of options for the Elliott forest plan, including: staying with the meager timber revenue status quo; boosting revenue by dropping a proposed Habitat Conservation Plan for species in favor of a “take avoidance strategy”—like that used on private forests; and selling the forest to invest the money for greater revenues.  A decision is scheduled for February.

Linn County Tree Farmers Recognized: The Oregon Tree Farm System in Nov. recognized Jim Cota, Robbie, Scott & Mike Melcher, as Oregon’s Outstanding Tree Farmers of the Year for 2009.   AOL members, Cota and the Melchers (Melcher Logging; Timber Harvesting, Inc.; Four M Fiber) operate their 1500-acre “Fun Forest Tree Farm” operation near Sweet Home.  The partnership acquired the forest in 1999, replanted under-stocked areas, and generally achieved great management for timber and recreation.

Two New Directors on OFRI Board: A former teacher and a forestry engineering consultant, both of whom also own tree farms, were appointed to the 11-member board of Oregon Forest Resources Institute.  Anne Hanschu of Forest Grove, and Ron Stuntzner of Coos Bay, were appointed by State Forester Marvin Brown for 3-year terms, to replace expiring members Steve Woodard and Carol Whipple.  Additionally, Gary Springer of Starker Forests, and Greg Miller of Weyerhaeuser, were reappointed.  OFRI was created by the Legislature in 1991 to improve public understanding of the state’s forest resources. OFRI is funded by a dedicated harvest tax on forest products producers.

Oregon Unemployment Stays High:  Oregon continues taking the economic slowdown harder than the nation. The state’s unemployment rate remained flat in November at 11.1%, well above the nation’s 10.0% level.  Oregon’s Nov. job-loss rate reached 4,600, and actually is much higher because many job seekers have given up, dropping out of the labor force and no-longer officially “unemployed” on the state roles, said Tim Duy, a Univ. of OR economist.

Western Congressmen Accuse Environmentalists of Abusing Law: In a letter sent to federal Attorney General Holder, the Congressional Western Caucus voiced concerns about abuse of the Equal Access to Justice Act (EAJA) by environmental groups, which received millions of federal taxpayer dollars to cover their legal fees following their lawsuits against the US Forest Service and other agencies.  Some 23 Republican senators and representatives requested that the Justice Dept. periodically provide public record of about how the EAJA payments to the environmental industry.

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