From factory explosion to pandemic, Maine’s wood products industry has had a tough year
If you’ve purchased building materials recently, you may have noticed that the prices have gone up: wood panels that would have cost you maybe $ 14 a year ago will now cost you $ 35 or $ 40. The pandemic has had a number of effects on the wood products industry.
To find out more about them, the host of the morning edition, Jennifer Mitchel, spoke with Patrick Strauch, executive director of the Maine Forest Products Council.
Jennifer Mitchell: So Patrick, what’s the matter with lumber prices right now? Why are they so tall even in a place like Maine that has, you know, a lot of trees around?
Patrick Strauch: Yes, I can speak from experience: I am trying to build an addition to my house. COVID caught a lot of people off guard, of course. There is no way to predict this kind of event, and I think you’ve discovered that we don’t have the manufacturing capacity to meet this demand. We had the wood resource. We had the loggers available to chop the wood. But we just didn’t have the ability to connect fast enough to produce the lumber in the panels we needed.
So where did the last year leave the Maine forest products industry? If we didn’t have a huge capacity for the finished lumber that everyone suddenly wanted, but we have a lot of trees and a lot of product, what happened to all of that and where did it go?
We are also part of a pulp and paper economy that affects everyone equally. Everything is interrelated. Factories in Maine that still made stationery and printing paper were losing markets due to the long-term trend of electronic communications. And many of them were converting to paper packaging products, cardboard-type products, and tissue paper: one factory in Woodland had tissue paper.
So these factories were strong, but we were still very dependent on media papers. And that market started to go south very quickly. And it started to create a surplus of wood already cut and on the market.
And then it was made worse by Jay’s digester, the Pixelle specialty paper digester, which burst. And that brought a major pulp and paper mill down into the lumberyard. So all of a sudden we had a lot of wood on the market. So we had a surplus of lumber, a strong demand for lumber, insufficient capacity to really absorb all that lumber. So the loggers always waited and the landowners waited for the markets to adjust. And it is only recently that we have seen this excess amount of lumber start to decrease, and as a result, the price of logs and pulpwood is adjusting.
So what about the future? You mentioned paper products like cardboard, packaging, cardboard, things like that: obviously we don’t have any numbers yet, but it looks like last year could have been a pretty bullish year for this. kind of stuff due to the pandemic and everybody is shopping online and having take out and things like that. But what have you learned over the pandemic year about what may need to change? Or is the wood product portfolio, I guess, diverse enough for what we know going forward?
Yes, I think it was recognized that we need to diversify our portfolio. If we think of ourselves, the state, as a business, and we want to stay in forest products, that’s really what we need to do. Fortunately, there are some market trends that really support this kind of concept. Much has to do with climate change.
And climate change is forcing us to ask ourselves what materials we use, can they be recycled? Is there a way to get out of petroleum based products and switch to more biodegradable products? And that opens up a lot of possibilities.