Steve Zika - Public money wasted
Dec 13, 2013 | 1 Comment
I read the Nov. 13 OPB article about the battle in Newport, written by Amelia Templeton, with a mix of sadness and “I told you so.”
Last year, I testified at an Oregon Transportation Commission hearing that using public funds to support the log-export yard was poor public policy for Oregon. Port of Newport officials assured the commission that this public money would create numerous jobs involving many export products.
What a surprise: Only out-of-staters with narrow self-interests want to sell their raw logs to China. Adding insult to injury, they need more public assistance for dredging.
Raw log exports from the West Coast are on pace to exceed 2 billion board feet in 2013, equaling the raw material needs of 25 large, domestic sawmills. Results include a log shortage for domestic sawmills and the highest log prices in the world, as Oregon’s family-owned sawmills struggle to stay in business.
Logs shipped to China are run through antiquated Chinese sawmill equipment by workers with substandard wages and rudimentary safety practices — nothing for Oregon to feel proud about.
Contrast that scenario with our Tillamook sawmill facility, which drew praise from the Oregon Environmental Quality Commission during a recent tour. In the past decade, the Hampton family has invested millions to improve the efficiency of the sawmill, make products we can sell globally, and assure the safety and environmental footprint of the facility. We pay family wages to all 140 employees and provide excellent health care and retirement packages.
Tillamook Lumber once employed well over 200 people, but today we can’t find enough logs at a price that allows us to make a profit. Environmental litigation has mostly locked up the federal forests and limited the harvest of state forests to lower than sustainable levels for Oregon sawmills.
Our company invested heavily to modernize our sawmills, developing the infrastructure and relationships overseas to sell finished lumber from our Oregon mills to markets in Japan, China, Taiwan, Korea, etc.
However, with public timber harvests down, log exports to Asia surging and demand diminished by reduced housing starts, we operate our Pacific Northwest sawmills at only 65 percent of capacity.
At Tillamook, we donated money for a new library and a football field, and helped with efforts to pass school property tax measures. We supported the rebuilding of Vernonia School and helped pay for training future workers in electrical and mechanical skills at Tillamook Community College.
Oregon’s family-owned sawmill businesses have a long history of investing in their local communities; the same cannot be said for out-of-state log exporters.
Some of these landowners represent investment money from all over the world and seem to be interested only in getting the maximum price for their logs by selling to Asian customers. They pull logs out of the Pacific Northwest “wood basket,” decreasing the local supply while keeping domestic log prices too high for existing lumber-market conditions.
Do we really believe the Chinese will continue to pay extraordinarily high prices for Oregon’s private logs after our domestic sawmill industry is decimated? Once the local industry is destroyed, Oregon’s private forest landowners will likely be forced to convert forestlands to nonforest uses because their customer base will be inadequate to support sustainable forest management.
This log export activity may add a few port jobs to ship raw logs to Asia, but a much larger group of Oregon’s sawmill workforce will disappear. I believe in free trade, but it is not fair trade when the Chinese subsidize raw material imports to create low-wage jobs in China.
Unfortunately, the ports in Newport and Astoria do not have the infrastructure to economically load the value-added lumber we produce and ship using containers. So once again, the sawmills and our workers will take it on the chin.
What kind of public policy is this for Oregon? As more domestic sawmills close, the United States will be forced to buy additional lumber from Canada. With all our underutilized natural resources, it is disgusting that we have to buy 35 percent of our lumber from Canada while we ship privately-owned logs to Asia.
Sawmill operations generate indirect jobs in industries providing supplies, trucking lumber, or selling residuals to pulp or particleboard mills. Don’t assume log exporting creates additional jobs in the woods, since those jobs will be there whether the logs are harvested for domestic or export use.
I applaud local citizens who understand the downside of log exports out of Newport and have stood up in opposition. It makes no sense for Oregon from either an environmental or an economic standpoint.
As I understand it, the final hurdle for proponents of the Newport yard is to obtain permission from the DEQ and State Land Board for dredging Yaquina Bay.
Now is the time for public officials to stand up for local jobs producing value-added products. Can we really afford to trade family-wage jobs for foreign log sales that leave Oregon poorer in so many ways? Please shut off the public funds for this unsustainable activity
Guest writer Steve Zika is CEO of Hampton Affiliates, which owns timberland and, eight sawmills, including one in Willamina. He earned a bachelor’s degree from Oregon State University and lives in Portland with his family. He enjoys golfing, hiking, reading, educating the public on the value of sustainable forestry.
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