Timber towns and the tariff

Times in the timber industry are about as rough as Brian Peters has seen in his 10 years as a logger.

The world market is flooded. Mills are closing. Timber prices are down, even during a sustained housing boom. About the only good news he's heard lately is that tariffs were slapped on Canadian softwood.

The tariffs, an outcome of longstanding allegations that the Canadian firms rely on unfair subsidies to compete with US industry, won't resolve all the challenges faced by Mr. Peters and other loggers from Maine to the Columbia River mouth.

Trade sanctions certainly won't restore the timber industry to its former prominence in towns like Forest Grove, which used to depend totally on the log-laden trucks that poured down the mountains, bringing money with them. Even within America's forest-products industry, some companies express ambivalence or outright opposition to the tariffs announced by the Bush administration last month.

But for Peters, who owns a small company of about 10 people here, the move promises to be a real help in hard times.

"I do know that, as a logger, timber prices are going up slightly," he says. "And when I asked why, they said 'the Canadian tariff.' And that's good enough for me."

But today, even as Peters cuts Douglas Fir and Western Red Cedar in the low coastal range to the east, and the Cascades to the west, Forest Grove is increasingly evolving away from its timber-town roots.

Log trucks still rumble into town, but now they mingle with trucks full of circuit boards and semiconductors and SUVs carrying commuters to nearby Portland.

These days, the bounty of the so-called "silicon forest," has become more vital than that of the real one. In 1970 Oregon had 950 mills that put out 6.7 million board feet. By 2000, 278 mills were left, putting out 5.9 million board feet. During the 1990s alone, wood products went from 6.1 percent of Oregon's economy to only 2.1 percent.

During those decades, the transformation of Portland – which was once called "Stumptown" because of all the logging – has helped to buffer nearby towns from dependence on trees. In more isolated areas, rural towns have been economically ruined by mill closures.

Even so, timber remains vital to the regional economy. The lumber mill is one of Forest Grove's biggest employers, and the tiny nearby town of Banks relies heavily on a mill that has managed to survive – so far.

Mark Laukkanen, a timber buyer for Banks Lumber, one of the last family owned mills in the area, sits in his pre-fab office and lists a legion of lumber-industry woes.

Across the railroad tracks from his office stand giant piles of logs waiting to be cut into boards for new homes. Just beyond the mill is a massive new housing project for Portland commuters.

For a long time, Mr. Laukkanen says, there was less wood for sale because of protections for the endangered spotted owl and other litigation that reduced federal timber sales. Then the Asian market dried up. Meanwhile, machinery to stay competitive costs more every year. Such factors, coupled with low-cost Canadian lumber, have been like a vise-grip. Banks Lumber lost money at least three months last year, he says.

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