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Local mills, timber industry hit bottom in 2009, now beginning slow climb out of recession, experts say
by JOEL ASCHBRENNER, Herald and News 12/17/11

Local timber mills are climbing out of the recession, but it’s going to be a sluggish trip, said Wade Mosby, vice president of Collins Products, a company that employs about 170 people in Klamath Falls.

“We think it’s not going to get any worse, but we think it’s going to be slow growth,” he said.

For the timber industry, the recession hit bottom in late 2008 and early 2009, and demand for wood products began increasing slightly in 2010 and 2011, said Mark Slezak, raw materials manager at Columbia Forest Products in Klamath Falls. Projections show demand will stay relatively flat in 2012.

In late 2008, the Collins mill cut its Klamath Falls plant from four shifts to two shifts a day due to lack of demand. Mosby said he thinks demand won’t increase significantly until 2014 or later. The collapse of the housing market in 2008 is to blame for much of the timber industry’s current woes, said Dave Schott, executive vice president of the Southern Oregon Timber Industries Association.

“A lot of this industry is contingent on new home construction,” he said. “Unfortunately, new home construction is horrible right now. We’ve had the worst three years ever.”

New home construction has stalled nationwide due to the high number of foreclosed homes on the market.

In 2005, there were about 2.1 million new home starts. This year, there have been about 500,000, Schott said.

“There’s a reason Jeld-Wen has fallen on hard times. There’s a reason the mills are barely hanging on,” he said. “The reason is there is no need (for wood products).”

Columbia Forest Products benefits from being less dependent on new home construction, Slezak said. About 70 percent of the company’s products are used in remodeling, rather than new construction. The company also benefited from implementing new technologies and processes at its plants.

“ We’ve tried to increase demand by being more efficient and trying to increase price competitiveness,” he said.

Mark Slezak, raw materials manager with Columbia Forest Products in Klamath Falls, has seen modest growth in demand for wood products in 2010 and 2011. The company benefits from selling products used in remodeling rather than new homes, as new homebuilding remains stagnant. H&N photo by Joel Aschbrenner




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