With a beleaguered forest products industry unable to make much of a dent in the trees killed by ravaging pine beetles, state officials may be looking for changes in the methods used by the U.S. Forest Service to contract logging operations.
“The private sector is key to dealing with this epidemic,” said Sen. Mark Udall, D-Colo., during a Capitol hearing with U.S. Forest Service Chief Tom Tidwell in early March. “We’d like to accelerate the way in which we streamline procedures, but there’s more to do — there are a lot of people ready and willing to do this.”
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That may be true, but the trend for the forest product industry in Colorado has been decidedly downward, and even the relative abundance of logs available for production doesn’t appear to be helping. With many Forest Service contracts concentrating on the swaths of long-dead lodgepole forest now diminishing in value, it isn’t clear the industry can rebound.
“It’s kind of a Catch-22,” explained Joe Duda, the deputy state forester with the Colorado State Forest Service who has overseen the agency’s utilization efforts for more than a decade. “To bring the cost of treatment down you need to enhance the use of forest products … but now you’ve got lower-value wood impacted by disease, insects and fire. And then you put on top of that the economic factors, and it’s really harmed the cost-effectiveness of those projects.
“At some point in time we need to make sure that we make the harder choices today, to make sure we set ourselves up for the future,” Duda said. “Otherwise we are always going to be chasing dead trees and that’s in nobody’s interest.”
In 1992, Colorado’s annual sawmill capacity was about 160 million board-feet annually; today it’s around 72 million board-feet, according to Kurt Mackes, a Colorado State University forestry professor who specializes in forest utilization. The state’s largest sawmill, Intermountain Resources of Montrose, has been in and out of receivership during the last two years and if it goes under, capacity may be reduced to less than 40 million board feet.
“Most of it is the economics,” said Mackes, noting the loss of the Bighorn, Wyo., sawmill in 2009 that had taken material from north-central Colorado. “A great deal of the wood that is normally generated goes to new home construction (which has been decidedly missing during the last four years). We have picked up some capacity in (wood) pellet production, but we continue to lose sawmill capacity.”
The forest products industry’s woes were initially created by a lack of timber contracts on national forest lands that began about a decade ago, Duda said. That meant the industry survived largely through cutting on private lands — until the bark beetle gained epidemic levels about six years ago.
After timber sales ceased, the federal Forest Service turned to service contracts to cut smaller trees, most of which weren’t suitable for sawmill or production uses. An amended version of the service contract is called a stewardship contract, which allows for some material to be utilized and is usually permitted over larger tracts of forest.
“The industry started to decline the same time as the forest health started to decline,” Duda said. “We do what’s easy in the short term, but fail to see the long-term consequences for our forests.”
So far, the mountain pine beetle has affected about 3.3 million acres of Colorado forests, devastating much of the lodgepole forests on the Western Slope. Mackes noted the quality of that wood begins to significantly decline about five years after the tree dies — about how long most of those trees have now been standing dead.
With many of the state’s mature lodgepole trees now gone, Larimer County is actually leading the state in tree mortality, as the bark beetles have moved into lower-elevation ponderosa pine forests. But federal contracts take a great deal of time to create, and are always subject to appeal, so it’s unclear whether management efforts can be moved to either areas with higher-value trees or to areas where management might cut tree mortality.
“In a state like Colorado, where there is a large need for forest treatments but few forest-management businesses, the Forest Service should tailor their timber sales and stewardship contracts to fit this industry, and work to try to move at the pace of industry as much as possible,” Udall said after the hearing with Tidwell.
Duda said he believes there is consensus in the Congressional delegation to be pro-active in supporting the forest products industry, but clearly the federal Forest Service will have to play a role.
“I think the issue with the stewardship contracts is that it is just one tool in the toolbox, not the only one,” Duda said. “The original goal of the stewardship contract was to develop more opportunity in the state and actually create more markets. It’s paid for a lot of treatment being done, but I’m not sure we’ve created any new market opportunities.”
At a small sawmill operation in Kremmling, Hester’s Log and Lumber, the opportunity to bid on smaller contracts would be welcomed by the owners. They have seen considerable success marketing their blue-stained dimensional lumber at area retail outlets.
“It’s getting harder and harder now to find material,” Cindy Hester said. “Almost everything we’ve gotten in comes from private lands, and now most of the private landowners have done most of their mitigation. Most of the sales (the feds) put up are great big sales, and they have to be done in a certain amount of time. We just can’t get them done in time, and they’re not putting up many smaller contracts.”
Hester said her company is still able to produce good boards from the material being brought in, though they are running short on larger-diameter product and beginning to see some rot in the logs.
However, at Rocks ‘n Pines in LaPorte, owner Lon Boehmer said he is spending a great deal of time sorting through unusable material, even though the majority of his products come from smaller roundwood used for fencing and posts.
“I’ve been in the business for 45 years, and I don’t know that I’ve ever seen (quality) this bad,” Boehmer said. Large cracks and widespread checking now routinely come with his logs.
He added that the severity of the epidemic may be causing the drop in quality – perhaps from more beetles attacking a single tree – though most experts say that the blue-stained wood when milled properly has equal stress capability as that of normal pine.
Tidwell said that although $100 million has been committed to fight the bark beetle in western states over the next several years, the Forest Service also has other projects that take priority, such as managing forests near residential development — the so-called Red-Zone area. Putting value back into timber contracting might be a heady task given those other priorities.
But Duda said that both size and the obligations of a contract can make a great deal of difference to whether a Colorado business can handle the project, and ultimately whether the resources are actually utilized.
“Time limit constraints, the way the products are designated and the (restoration) work — the ways these contractual obligations are defined have a huge impact on the outcome of the project,” he said. “That’s not only in how it will affect the landscape, but how cost-effective it is. Helping people understand where those subtle differences are is a big hurdle.”
Even so, no one expects that a timber sale will actually make money for the Forest Service or even break even in the foreseeable future. Cutting and transporting logs for any energy use doesn’t even come close to breaking even, Mackes said.
“Traditional timber sales, where the logs have more value than the cost, are quickly becoming a thing of the past in Colorado,” he said. “Stumpage values have decreased dramatically — in many cases the value of the wood simply does not pay for its removal.”