Timber industry plants new seed

Posted: Thursday, January 23, 2003

The Kenai Peninsula timber industry is taking its first steps at trying to make a comeback.

Representatives from the logging industry met Tuesday afternoon in a forum organized by the Kenai Peninsula Economic Development District and the Kenai Peninsula Borough's Division of Economic and Development to come up with strategies to revitalize a business which many said has seen better days.

"The value of wood is far less than it was 100 years ago," said Mitch Michaud, a representative of the U.S. Department of Agri-culture's Resource Conservation and Development program.

"It's cheaper to ship wood up here than it is to operate a sawmill."

The 25 men who gathered in the conference room of the Red Diamond Center sought to create an alliance of the many loggers, mill owners and assorted timber industry members on the peninsula.

KPEDD project coordinator Andrew Schmahl said bringing the different parts of the industry together is the only way for it to survive.

"We want to form a viable organization that is able to accomplish more as a whole than individuals could accomplish," he said.

Jack Brown, the borough's business development manager, officiated the meeting, and proposed forming an organization similar to the one Cook Inlet commercial fishers formed last year to revitalize their industry, through the borough-supported Kenai Wild branding program.

"If we elect to go ahead with a timber coalition, we have a model," Brown said. "If we can form an organization that has credibility and is supported by local politicians, we can be as successful as the fishing industry."

Among the issues identified that could help improve business for the logging industry were increasing access to timber, developing markets, establishing a central area for sorting and grading, and developing value-added products.

Mill owner Tim O'Brien, who spearheaded the meeting, referred to a timber cooperative which was started in the early 1980s through KPEDD, suggesting this same idea be used to move the timber industry forward. He said one reason that project failed was because there was minimal funding available to help.

O'Brien said with the right funding, a cooperative could actually become the central hub of timber business and could free individuals to focus on what they specialize in.

"If we can do this, we can be the mill," O'Brien said. "If you're a logger, you log. I'm a mill owner. You haul (the timber) to us and we'll take care of it from there."

Ron Pipkin of Alaskan Composite Technology said his company could contribute a binder that would press lumber byproducts like branches, stumps and chips into value-added products.

Juan Jorgensen said Pipkin's offer would be an integral part of a future program, but landowners with access to timber also need to be included.

"If we're going to just build two-by-fours, it's a lost cause," Jorgensen said. "But if we get into selling railroad ties and other products like siding and molding, we can be successful. The only way we're going to come out on top is if we have our own harvester."

Brown said creating political ties and demonstrating need are keys to accessing funding through grants and loans that could go toward building and equipping a central mill and opening up access to timber.

But he and Michaud said forming a cooperative has its limitations.

"If you use the term 'cooperative,' you can't get grants, because it is a for profit organization," Michaud said. "But you can get loans."

Brown said the focus on forming a cooperative is possibly diverting attention away from addressing the issues that could help jump-start the industry.

"Some of the things you've identified could be accomplished without a cooperative," Brown told the group. "You could have the best cooperative in the world, but if you don't have access to trees, it doesn't matter."

Cliff Donegan, of Sterling, emphasized the importance of remaining steadfast, if people wanted to see results. He said, in the past, lackluster participation and competition spoiled good intentions.

"The problem is, everybody's really independent, and most are interested because they need work right now," Donegan said. "Everybody's so afraid this guy over here is going to get more money. If you can't come to an agreement in one direction, everything is going to go off in different directions."

Brown collected names of those attending and set a time for a second meeting, to be held Feb. 4 at 2 p.m. at the CARTS building on Kalifornsky Beach Road. He agreed with Donegan that only a united front will benefit efforts to rebuild the industry.

"Something could come out of this if there's a solid organization," he said.

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