Kenai Peninsula Timber Inc. has the basic infrastructure it needs to begin making a market for area beetle-kill spruce wood. And in the coming weeks, the fledgling organization will put together plans to begin making the operation work.
The newly-formed nonprofit corporation has united a number of timber workers on the Kenai Peninsula to revitalize the industry. When the group determined that it wanted to start small, Anchor Point mill operator Buz Moore offered to loan some of his equipment to KPT Inc.
"Spring is going to be here soon," he said at the group's Wednesday meeting. "If you guys are serious about this, I can give you (a) generator and loan you other stuff. And not on a short-term basis."
The equipment Moore offered on loan included a dry kiln, a large edger, a band resaw and a small planer. These machines would be used for much of the processing lumber would go through before going to market, from drying and conditioning to cutting, leveling and sizing as needed.
And the 275-kilowatt electrical generator would power the equipment.
Moore said with the exception of a loader and an debarking machine, he was offering "everything that they need to get started."
"This way, they won't have to make a large investment until they know how much they'll be able to do," he said. "My suggestion is that you get your market going before you invest a whole lot of money into this."
That market may be developing. Nikiski log cabin builder David Goode said he had found sources for markets in the Lower 48 that would give the corporation a reasonable jump start. These included requests ranging from queries for 28,000 pounds of stable wood chips per month, to an individual prepared to keep a truck in the Kenai Peninsula area on an on-going basis to help ship building logs to market, he said.
Moore said determining what type of wood products the group wants to deal in -- be it construction board, railroad ties or wood chips -- is an important factor in developing a market, as is setting a competitive price.
"To be able to get the market, we've got to be able to get pricing with shipping and without shipping," Goode said.
He said shipping fewer than 540 logs, at a cost of between $4,500 and $5,000, would not be profitable if the group were to charge prices comparable to those Outside.
KPT Inc. member Juan Jorgensen cautioned against trying to deal too heavily in exporting building products Outside so soon, however.
"If we're going to count on board logs, we'll be in trouble," he told Goode. "All these deals you've got are volume deals."
KPT Inc. president Tim O'Brien also informed the group that he had received information from state officials about a 7 percent incentive given to in-state suppliers of building equipment. But he and Mitch Michaub, of the U.S. Department of Agriculture's Resource Conservation and Development program, said a definitive direction needed to be set before the group pursues any opportunities.
"We need a plan," Michaub said.
A committee was formed to create an operational business plan, and committees were formed to build ties with government officials and to develop funding.
The next meeting will be held at 4 p.m. March 11 at Gander's restaurant in the Peninsula Center Mall in Soldotna.
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