More Plum Creek layoffs

By CHRIS PETERSON / Hungry Horse News

Plum Creek Timber Co. announced last week it would cut 68 jobs from its plywood plants and has also informed its four logging contractors that there's no work for them.

Sixty-four of the positions will be cut from its Kalispell plywood plant and four positions will be cut from the Columbia Falls plywood plant.

Beginning Dec. 1, both plants will be scheduled to run two shifts, Kalispell with 212 employees and Columbia Falls with 186 employees.

The company blames the economic downturn as the housing and other construction markets continue to slump.

The plywood made at both plants is primarily used in high-grade and specialty industrial applications, such as boats, recreational vehicles, transportation, concrete forming and other construction industries.

"We are not seeing any improvement in the national economy in the fourth quarter, and our customers are continuing to feel the effects of these challenging conditions. The outlook does not indicate improvement until 2010, requiring us to re-align our basic plywood capacity," said Hank Ricklefs, vice president for Northern Resources and Manufacturing. "We had at least hoped to keep operating three shifts through the year at the Kalispell facility, but the demand for specialty plywood is just not there."

Plum Creek's manufacturing segment, which includes all of its Montana mills and one in Idaho, reported a third-quarter loss of $4 million.

These layoffs come on the heels of staff cuts in September when the company cut 35 positions from its medium density fiberboard (MDF) plant in Columbia Falls. In addition, 275 employees at other area mills saw 40 hours a month trimmed from their employment.

The lumber markets are the worst in almost three decades, notes Shawn Church, editor of Random Lengths, a publication that tracks lumber markets for the wood products industry.

Church said that some lumber prices are actually lower, even if they're not adjusted for inflation, than they were in the recession of the early 1980s.

"The industry as a whole is dealing with a historical downturn," he said.

Housing starts in October, for example, were down 40 percent nationwide from a year ago, and are down to levels not seen since the 1950s.

As a result, mills have either slowed production or ceased production altogether, not just here, but across the West, as demand for lumber has stagnated.