Timber Companies Still Thriving

From The Oregonian June 5, 1994

By Peter Sleeth

The mistake would be easy to make. Big timber is dead.

The logic would go something like this: Forest products companies are waning as trees grow as scarce as the marbled murrelet. The Northwest economy no longer counts timber barons as part of the local corporate culture.

But the problem is this: The logic is dead wrong.

Five major timber companies weigh in heavily in the list of the top 50 area companies. Whether ranked by revenue or net income, Pope & Talbot, Inc.; Louisiana-Pacific Corp.; Willamette Industries, Inc.; Longview Fibre, Inc.; and WTD Industries, Inc. continue to be in the top 20 and significant players in the Northwest economy.

Wood products remains the largest manufacturing sector, measured by employment, in Oregon.

How are the companies surviving with the tide of federal forest policies turning against them, with the pulp and paper industry in the doldrums because of oversupply, and with the supply of large, clear-grained old growth declining?

The answer lies in innovation and an owl.

Companies such as Louisiana-Pacific have led the way with new products that do not rely on traditional timber. Oriented strand board, for example, is a plywood substitute made of wood chips. Other companies are making laminated beams from smaller pieces of lumber to substitute for the beams that used to come from old-growth logs.

The northern spotted owl, perhaps the most despised animal in the forest to many in the industry, is also a profit center. It happened like this: As federal forests were shut down to logging to protect the threatened bird, logs became more scarce and their prices rose. Companies with their own timber lands profited as a result.

For a company such as Longview Fibre, which is heavily invested in pulp and paper production, those log prices have been about the only bright spot on a dismal horizon.

Now there appears to be some firming in paper prices, meaning continuing high log prices could be buttressed by an improving paper market.

And that could make 1994 a big year for an industry some would write off.

© 1994 Oregonian Publishing Company

Accession Number: POR41590242