Trends in the Northeast Forest Industry, 2023
The following is an excerpt from an article published in the January 2023 issue of The Northern Logger & Timber Processor Magazine. The entire article, which discusses wood availability, markets, carbon, and new investments in the forest industry, can be read here.
The Northeast forest industry is going through some rapid changes – challenges in labor, wood supply (much of it related to labor), and costs. At the same time, we’re seeing individuals and firms get creative in problem-solving – finding new ways to secure wood supply, building logging capacity, and investing in new and existing wood-using industries. Turmoil brings opportunity, and the industry is ripe with opportunity. The forest industry is always changing and evolving, and the dynamic nature of today’s marketplace may be the seeds of some new thinking, models, and markets.
Around the Northeast, mills have scrambled to find wood. There’s plenty of wood in the forests, but the logging infrastructure needed to harvest and transport it from the woods to the mill simply isn’t adequate to supply all of the wood-using mills in the region. Talking to loggers across the region, it’s fair to say we’ve seen a 20% – 30% decrease in total logging and trucking capacity in the last couple of years. There is a range of factors at work here, including an aging logging workforce, a rural demographic challenge filling any jobs, the high cost to purchase logging equipment and start a new crew, diesel cost, inflation on logging costs, and more. Some of these may be cyclical, but some aren’t. It’s probably time for the entire industry to do some serious thinking about how to recruit, retain, structure, and compensate loggers, because the rest of the industry doesn’t function if there aren’t an adequate number of folks to cut and haul wood.
In some places, we are starting to see new models develop. There are sawmills investing directly in logging capacity, and I have heard from a number of mills that they are sending trucks – their own or contract – to pick up wood on landings. These changes aren’t necessarily welcomed by all – the independent logger is iconic (and logical) in our industry – but it’s pretty clear that what we’ve been doing for decades isn’t attracting enough new people into logging or encouraging enough new crews. Money can solve some of these challenges, but in many ways, money isn’t enough. We’ll see firms try to solve this challenge in a number of ways over the coming years, and it will be interesting to see which models succeed.
In the absence of enough logging capacity, mills still need their wood. And they are doing what they need to in order to get it. We’ve seen train cars full of pulpwood arrive in New York from outside the region, and a boatload (yes, literally a boatload) of pulp chips imported to Maine. There’s no reason to think that these are one-time events, but the high cost paid for this (extremely) distant wood may open up thinking and provide new opportunities for sourcing wood locally.