Forest industry on a downward trend

Montana State Roundup

Published October 1, 2000  | October 2000 issue

Production and prices are down in the forest products industry this year, and the decline will likely continue, according to the University of Montana's Bureau of Business and Economic Research.

An expected decline in construction and an increase in interest rates are contributing to the lowest lumber and plywood prices in years. At the same time, lumber companies face higher power costs, and in some case four-times higher than a year ago, especially if they purchase electricity on the spot market.

Employment and production at mills fell during the second quarter. Lumber production was down 4 percent to 327 million board feet in the second quarter. Plywood also was down, by 5 million square feet from the first to the second quarter. Production employment decreased by 81 workers during the same period, its lowest level since 1992.