Lower pine plantings reflect slump in timber industry

Monday, February 17, 2003

DRAYTON, Ga. -- With abundant rainfall, cooler temperatures and the end of a four-year drought, landowners finally have ideal conditions for planting the pine trees that are a mainstay of the South's economy.

Yet there's no flurry of planting -- owners seem to be riding out an industry slump that has led to mill closings, consolidations, the lowest pulpwood prices in years and a surfeit of some types of timber.

Rob Routhier, executive vice president of Albany-based F&W Forestry Inc., which manages forest land from Virginia to Texas, attributes some of the oversupply to government tree-planting programs and some to the drought.

Normally, loggers can't reach the trees during the rainy winter season because the soil is too wet. But in the last three years, "they've had basically no down time," he said.

F&W will plant about 7 million acres this year, about 2 million fewer than normal, Routhier said.

"A lot of it has to do with the timber market being somewhat depressed," he said.

The $120 billion forestry industry provides 770,000 jobs in the 13 Southern states.

Russ Pohl, reforestation chief for the Georgia Forestry Commission, said he believes landowners are concerned about the uncertain stock market and economy and don't want to invest in trees right now.

George Hernandez, a regeneration specialist at the Forest Service's regional office in Atlanta, said the industry is undergoing major changes that are difficult to analyze.

"That does not mean that 20 years from now we won't have timber," he said. "Timber is no different from software or any other industries having a slow period."

Another factor is the interruption of government programs that paid landowners to plant millions of acres of pine over the past two decades. Cost-sharing programs were included in the new farm bill passed last spring, but that money will arrive too late to help this year.

As a result, the South's state and private nurseries are having sluggish sales and may wind up destroying millions of 1-year-old seedlings that cannot be carried over to next year if they are not planted.

At the Georgia Forestry Flint River Nursery, near the southwestern Georgia town of Drayton, wide rows filled with millions of pinkish seedlings stretch across the sandy terrain.

In a steel building, workers sort longleaf seedlings, which are still in demand, and pack them into bundles.

The nursery sold 175 million seedlings in 1987 and produces 40 million to 50 million in a typical year. Usually, it would have sold out last July. But this year there will be a surplus, despite a cutback in production, Pohl said.

"We're here to see that trees get planted and to make the trees available," he said. "To do that, we have to accept that we will have a surplus occasionally. We are trying to look out for the small landowner. Without us, that would be an underserved market."

Forestry officials in Alabama, South Carolina and Virginia also expect seedling surpluses.

Craig Frazier, manager of the Alabama Forestry Commission's nursery at Atmore, Ala., said his state has lost three pulp mills and some prime timberland.

"Our pine pulp wood market has basically bottomed out," he said. "You've got an abundance of timber on the market. Demand is down."

Frazier said his nursery, which sold all its 54 million seedlings in 1998, probably will have to destroy some of the 10 million seedlings it grew for this year.

Joel Felder, forest management chief for the South Carolina Forestry Commission, said the two state nurseries had to conduct lotteries a few years ago because of overwhelming demand for seedlings.

"This year, we'll probably have a bunch of them left," he said. "Anticipating demand has been a tremendously difficult task."

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On the Net:

Georgia Forestry Commission: www.gfc.state.ga.us

USDA Forest Service Southern Forest Resource Assessment: www.srs.fs.fed.us/sustain

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