Timber!

One of Minnesota's oldest industries, logging, has spent the last two years in a freefall, a decline timber industry professionals believe is directly related to the current state of the economy.

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It has resulted in a loss of 10 to 15 percent of the logging capacity in the state the past two years, said Scott Dane, executive director of Associated Contract Loggers & Truckers of Minnesota in Biwabik. The industry, he noted, includes 1,500-2,000 loggers and more than 40,000 jobs tied to wood sources in Minnesota.

"It's a struggle. It's been a very difficult struggle for two years now and unfortunately we don't see the light at the end of the tunnel," Dane said. "How long we can continue to survive is the big question."

And as prices for timber decline, loggers are seeing costs increase from the price of fuel to the expense of machinery.

Timber at Rod Enberg's logging company near Motley awaits delivery to a customer. Brainerd Dispatch/Steve Kohls» Purchase reprints of this photo.

The struggle started about a year-and-a-half ago, said Ron Sanow, Brainerd area DNR forest supervisor, as a byproduct of the housing market collapse. When the demand for houses fell, so did the need for boards to make those houses. That led to the shutdown of Ainsworth in Grand Rapids and Weyerhaeuser in Deerwood, both wood product companies.

"It affects where loggers and logging companies can sell products," Sanow said. "The industry, it is not going through the best of times."

Dane said the logging industry recognized two years ago that the market might decline and came up with a survival plan. With the help of local, state and federal governments, the idea was to keep the industry going until the economy recovered.

"Two years lapsed and unfortunately it has not improved but has gotten worse," Dane said.

Bill Hettver, who owns a logging company in the Pine Center area, said costs of operation have gone through the roof.

"It's like everything else, you're working harder and ending up with less money," Hettver said. "We're here, but it's not like it used to be."

The timber is there, however.

Norm Moody, Cass County land commissioner, said his county has 4,000 acres of timber for sale, same as last year, and it appears it all will be sold. Crow Wing County Forester Brian Pike said 13,000 cords of aspen were sold in October, about the same as was sold in March.

"Our tracts, for the most part, have been selling," Pike said.

Moody said the industry has been through a sluggish market before. He's optimistic the industry will return once the government figures out how to rescue the nation's troubled financial markets.

"What we're dealing with in the forest industry is unsustainability in the financial services industry," Moody said. "If we had sustainable oversight of financial markets I don't think we'd be in this problem."

Hettver said common sense is lacking in timber administration and sales and in environmental restrictions facing loggers.

"We can't hardly even work any more," he said.

With the closure of mills and a downturn in paper and pulp mills, loggers have turned to other markets for their wood.

Rod Enberg of Motley said before the collapse of the economy, loggers were able to work with two or three big mills rather than with little ones. With the closing of larger mills he sells his wood wherever he can and he appreciates being able to do so.

Enberg has turned to land clearing and grinding wood for the biomass energy market, which allows him to sell his product to more places.

"So far it's been OK," Enberg said. "We're not flourishing by any means but we've stayed alive and maintained the same size of crews we've had in the past. We've learned to work a lot smarter but it's been a learning experience, it really has. We're hoping things will change."

Kevin Banick, logger based in Brainerd, has also entered the biomass energy market.

"You have to do other things to stay alive," Banick said. "You can't just do logging anymore."

But the money is not there anymore, Banick said, and like Hettver, who is Banick's cousin, the cost of operating his logging company, from buying oil and tires to buying equipment, has been on the rise.

"I think it's going to be tougher and tougher as we go," Banick said. "All expenses went up and we're getting paid less money to do the work."

One saving grace has been the recent drop in fuel prices, Hettver said.

"But it's almost a little too late," Hettver said.

Enberg hopes the Legislature will better fund DNR forestry to better utilize the timber resources available, which could result in mills being re-opened. Moody believes once the financial markets are stabilized and regulated the industry will return.

"It's tough times, but if you've been around for a while you've seen it before," Moody said. "All we can do is ride it out, keep making wood available and the markets are going to come back."

MATT ERICKSON may be reached at matt.erickson@brainerddispatch.com or 855-5857.