Timber Industry Asks Congress for $2.5B in COVID-19 Aid
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Passed over in previous pandemic relief measures, the timber industry is asking Congress for at least $2.5 billion to help businesses recover from financial losses.
Logging companies are counting on Sen. Susan Collins (R-Maine) and Rep. David Rouzer (R-N.C.), among others, to push for grants and loans that would help companies that saw revenue decline at least 10% due to the pandemic.
The lawmakers could introduce legislation within days, industry and congressional sources said, with the aim of attaching it to a forthcoming COVID-19 relief package. Republican leaders in the Senate may introduce that bill this week.
According to industry sources, logging companies in some states have seen revenue drop off as much as 30% thanks to slowdowns in home construction and other business that rely on a steady supply of wood.
Even the paper industry, bolstered by increased production of toilet tissue, for instance, has seen product lines such as school supplies shrink dramatically, said Daniel Dructor, executive vice president of the American Loggers Council.
Sen. Susan Collins (R-Maine) is leading legislation to help the timber industry during the pandemic. Francis Chung/E&E News
If losses continue without help from the government, Dructor told E&E News, "we'll be hard-pressed to rebuild this industry."
Logging companies see themselves on an even level with agriculture, and farmers have seen help from Congress from the earliest measures, said Dructor, whose organization represents timber industry groups and companies in 36 states. "We felt like they had been impacted just as much," he said.
The measure being pressed by loggers would provide assistance to companies that experienced losses of 10% from January to July, compared with a year earlier, Dructor said.
The money would begin as a bridge loan from the Department of Agriculture, to be converted to a grant later if the company can prove losses of at least 10%, according to a letter from the Loggers Council to lawmakers.
USDA oversees federal forestry programs, and Agriculture Secretary Sonny Perdue has publicly said he sees trees as crops, albeit with a longer growing cycle.
The Loggers Council told lawmakers, "This program is intended to ensure that contractors can have the opportunity to remain in business over the next 12 months and to adjust their operations as markets begin to stabilize."
The group estimated state-level losses to loggers of around 30% of production in North Carolina. Other states reported financial shortfalls of $115 million in Alabama, $99 million in Georgia and $52 million in Florida, with all the figures provided by state logging associations.
Dructor said most of the companies in question are smaller, family-run operations. Like farmers, he said, they tend to have high fixed costs. They rely on trees taken from a combination of private land and federal land, including national forests, he said.
The outlook for wood products is mixed, and the Loggers Council said it expects the slowdown to extend into next year.
While home improvements and demand for paper packaging have increased during the pandemic, giving the industry a boost, the biggest piece of the U.S. industry — lumber used in construction and home renovations — has been hard hit. The effects are likely to last through this year, according to Hancock Natural Resource Group, a farmland and timberland investment group, in a May report. Earlier in the pandemic, the Forest Service said it would extend contract deadlines on timber sales and give companies more time to make timber sale payments to the federal government.
