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"We've had a reduction in the pine saw timber harvest," said Steve Dickie, an extension forester for the state's southwest district. "We've had historically high housing starts for years to keep that lumber in demand, but all of that has fallen by the wayside now. The mills have built up an inventory, and we're neck-deep in lumber right now."
Dickie said the lumber market would remain stale until mortgage interest rates around the country began to fall under 6 percent.
"That's the magic number," he said. "Any time mortgages go over 6 percent, we see a decrease in housing and a decrease in the demand for lumber. Once those rates duck back under 6 percent, the market should pick back up."
Dickie said analysts were predicting the mortgage rates to lessen in 2008, though he stressed that it will not happen overnight. He pointed to the fall of this year, and maybe even into 2009, as a likely time for the lumber market to begin improving.
"It's going to take a while to get this inventory of lumber off our backs," he said.
Until lumber value goes up, lumber companies, and other forestry industries, will continue to feel the pinch.
"We're definitely in the midst of a very, very depressed market," said Jeff Grierson, president and part owner of Columbus Lumber Co. in Brookhaven. "The lumber market is woeful right now."
Grierson pointed out that, despite the low value of lumber, the Gulf Coast region was managing to keep the boards moving, while other regions in the country are not.
"There's still rebuilding that is going on down here because of Hurricane Katrina that no one else in the country is experiencing," he said. "That has helped keep the lumber moving, but it hasn't helped with the price. We moved basically the same amount of lumber in 2007 as we did in 2006, but at much lower prices."
While the value of lumber sags nationally, the prices are monitored, and largely influenced, by Random Lengths, a forestry information service based in Eugene, Ore. Random Lengths compiles a large list of several data weekly by contacting wholesalers and manufacturers to gather the average prices of lumber and other forestry products across the country.
"They print where the market is at," Grierson said. "And they've been doing it for so long, everyone buys and sells according to their estimates. Buyers will call you up on Monday and ask, 'What did the print say Friday?'"
The "print" has posted some depressing Fridays over the past two years.
"The composite average price for lumber in 2006 was approximately $365 per thousand board feet," Grierson said. "Last year, it was around $315 per thousand board feet. That's a $50 per thousand board feet loss, and it adds up fast. We pump out millions of board feet per month."
Grierson said the average truck load of lumber contains roughly 22,000 board feet. With a hit of $50 taken on every thousand board feet, each truck load is delivering about $1,100 less than it was in 2006.
Within each truckload of lumber lies another great bane of the forestry industry - the price of fuel.
"Fuel prices have definitely hurt us," Grierson said. "If you take the cost of living, price index, fuel costs and inflation, you'd probably have to go back to the 1970s to find the same market situation as we're having now.
"So many factors go in different directions to affect the bottom line," he continued. "Timber prices are stable, lumber prices go down and gas prices go way up. You put all that in a blender and pull the answer out, it's not pretty."
Bradley Jim Smith, owner and president of B.J. Smith Logging Inc., does not think the situation is petty either. The devaluation of lumber has affected logging industry, but it has not made as much of an impact as the costs of fuel.
"Fuel is the biggest problem," he said. "When you look at it all, that's where it starts. The old saying 'up in smoke' is a fact now. All our money's going up in smoke. All we're doing is turning over money."
With the housing market in shambles and lumber stacked in warehouses across the country, the demand for timber is also down, and loggers like Smith are shouldering the financial losses.
"If it went up like everything else, there ought to be a 30 or 40 percent increase," he said. "The value of timber is the same or maybe even less than it was in 1994 when I went into business, but the cost of fuel has tripled since then."
Smith said loads of timber were bringing in a far lower gate price, the price paid for logs at the door of the mill, and loggers were being forced to pay landowners more for timber harvesting rights. He said the cost of equipment has doubled, the cost of fuel has tripled and the rates have stayed the same.
"It just costs more for us to operate these days," Smith said. "It's one of those games where you make money one week and none the next. You have to look at your business from a yearly standpoint, 'cause if you look at it day to day, you'll find yourself flat broke and go crazy."
Smith pointed to a decrease in the stumpage price, the money paid to landowners for timber harvesting rights, and the strictness of equipment emissions restrictions as two variables that are currently hurting the logging business.
"I'm all for doing what's right and taking care of the environment, but when they started all that emissions stuff out in California it has really hurt us," he said. "It's just like running the air conditioner in your car. The extra engine power it takes to run that compressor hurts your gas mileage. All the new emissions parts are burdening these engines. And those new Tier 3 engines, they're just gulping down gas. We get worse fuel mileage now than we did three years ago."
Despite forestry's downward turn of events, Mississippi's wood workers are enduring.
"We're continuing to survive, despite the down market," Grierson said of Columbus Lumber. "And we're going to continue to survive."
Grierson said his company had met the challenge by expanding into other markets and by developing special lumber products to fill niche markets, like pre-notched fence boards and other modified pieces.
While the heat is on the forestry industry, Smith offered some advice for the next year, or more, while the logging and lumber sections of the industry wait on the housing market to regain strength and help to pull the wood markets through.
"I've just tried to quit worrying about it," he said. "We'll just have to ride it out and pray about; do lots of prayin'."
