Timber prices, demand rise, fuel Florida boom

A truckload of logs heads to the Klausner lumber mill in Live Oak, Fla., in late July.
A truckload of logs heads to the Klausner lumber mill in Live Oak, Fla., in late July.

LIVE OAK, Fla. -- The towering grove of century-old longleaf pines surrounding Roger Ward's family home is a rare site in this verdant swath of north-central Florida, because most pines here are cut and processed for profit as soon as their 15-to-18-year growth cycle is complete.

photo

AP

Timberland owner Roger Ward (left) measures an area of seedling slash pines with Brian Cobble of the Florida Forest Service in Live Oak, Fla., earlier this summer.

The demand for timber worldwide is booming, and this remote section of Florida, along with other timber-growing regions of the Southeastern U.S., is benefiting. Dozens of lumber mills and pine straw, bark and wood pellet processing plants have sprung up in north Florida to take advantage of the soil composition; lengthy growing season; and warm, moist climate in which pine trees thrive.

In a state where undeveloped real estate quickly gives way to neighborhoods, strip malls, hotels or amusement parks, this timber-rich part of Florida is unusual.

Ward jokes that the acres of tall pines constituted his college fund and his parents' 401(k). The family's fortunes have long been linked to the rise and fall of the timber market.

"This is certainly one of the better times around here for timber," Ward said as he inspected a field of tree saplings on a recent afternoon.

Timber prices are rising as demand grows for timber used in building, paper products and biofuels worldwide. Prices for Florida saw pine peaked around 2005 -- before the housing bust and the recession -- at $40 a ton, according to Timber Mart-South, a Georgia-based nonprofit organization that tracks the timber industry. Prices fell to $21 a ton in 2011 but are now around $25 a ton and rising.

Thomas Mende, president of U.S. operations for the Austrian-based timber company Klausner, is another person banking on the Southeastern timber market. Mende's company recently invested $130 million in a new Suwanee County, Florida, timber mill, which ships pine boards to Asia, South America, Europe and beyond.

On the main road outside the mill, a billboard encourages residents to apply for jobs. Klausner currently employs 300 people in Live Oak and hopes to hire about 50 more.

"What you have here is an ideal location where the trees grow fast, there is political stability, excellent infrastructure and a solid workforce," Mende said from his office, which overlooks acres of processed wood awaiting shipment.

In the American Northwest and in Canada, some federal restrictions on foresting, longer growing cycles and problems with wood boring beetles have created supply problems and driven up costs, Mende and other experts said.

"Wood is being rediscovered as environmentally friendly," Mende said.

He points to major building projects, including a 10-story wood building recently built in Australia and a taller wood building in Austria. The buildings use wood panels up to 64 feet long and 8 feet wide.

The building trend is one of many factors fueling a steady increase in the price of pine, said Sara Baldwin of Timber Mart-South.

"Certainly with the opening of a brand new mill in the middle of that region, I would say Florida pine is experiencing a resurgence," she said.

Nowadays Ward and his fellow Suwanee County farmers are turning to Brian Cobble, the region's longtime state forestry manager, for his expertise on nurturing tree saplings to maturity and making sure they make the best use of their land. On a recent morning, Cobble and Ward waded through acres of waist-high saplings, assessing their health.

The fresh smell of dog fennel sprouts, also known as wild chamomile, permeated the muggy midmorning air as gnats and mosquitoes buzzed over the young trees.

Ward and Cobble used a tape measure to help count the 31 saplings within a 26.3-foot radius, or a 20th of an acre. Cobble inspected saplings that weren't thriving to determine if they had insects or were being smothered by the surrounding vegetation. He advised Ward to mow in some areas and use herbicide in others.

But as has often been the case in Florida, despite the growing demand for timber and rising prices, some in the area think the tree farms will eventually give way to development.

Baldwin said development, especially in Florida, frequently wins out over other land uses.

"Trees are not always the highest and best use of land, and there are often economic pressures to develop," she said.

But Mende, of the Klausner mill, said trees, at least in the short term, are the region's future.

Ward agreed.

"It comes down to the math," he said. "If trees are the best return on investment available for the land, people will plant trees."

SundayMonday Business on 09/07/2015

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