West Virgina: Industry is crippled and their really slow to realize it

With approximately 20,000 direct jobs and an estimated $3 billion in
annual revenue, forestry is big business in the Mountain State. The
third most-forested state in the nation, trees cover 78 percent of
West Virginia’s 15.4 million acres. Of that, better than 90 percent of
the terrain is dominated by hardwood species such as maple and oak.
Almost 80 percent of that forested land is owned by farmers,
individuals and other private landowners with 12 percent belonging to
the government and less than 10 percent owned by various wood product
companies. These are somewhat hard times for those who depend upon
revenue from hardwoods, according to Dick Waybright of the West
Virginia Forestry Association. “Forestry was already in a downturn
before the current economic situation hit,” Waybright said. “A general
decline began three years ago. We have really taken a beating over the
last year.”

What are the contributing factors? Waybright blamed the
slump on an increase in foreign competition, including the relocation
of American furniture manufacturers overseas. As in other industries,
China continues to be a big player in the global market. Home
construction is down, and the homes that are being built contain fewer
hardwood products than in previous years. “There has been a decline in
the housing market,” he said. “And there has been a trend away from
the grainy woods such as red oak and white oak in cabinets and
hardwood floors. That’s hurt us bad. Hardwoods will come back a good
bit, though, when people start building houses again.” In the
meantime, wood-product businesses are attempting to develop new
markets for their products. A prime example, he said, is an increase
in demand for wood biomass for home heating. Two West Virginia
companies produce the high-pressure fuel pellets. Waybright said
sawmill operators are searching for specialty items to help get them
through a difficult period. “They’re trying to find a specific niche
in the market to help them move some of their hardwood,” he said. In
general, the mills are having less success in marketing their lumber.
As a result, the state’s loggers have fewer sites available to bring
their inventory. “We’re seeing some who are downsizing,” Waybright
said. “They’re not having as much overtime, cutting back their hours,
or having layoffs. Most of these are smaller, family operations. You
have situations where people are borrowing money to be able to stack
logs and keep operating.”
http://www.builderonline.com/sales/wood-industry-looks-for-niches-to-fill-homebuilding-void.aspx?rssLink=Wood+Industry+Looks+for+Niches+to+Fill+Homebuilding+Void

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