Ninety employees of Tricon Timber in St. Regis were laid off Friday. The company's website says it’s one of the largest employers in western Montana's Mineral county.
"I don't know if we still are or are not now. We just laid off almost half of our work staff."
That's Tricon's Vice President of Logistics, Joe Zito, who says the layoffs will probably be a huge blow to Mineral County which already has a high unemployment rate.
"We probably won't know the full outcome of that for a couple of months as things trickle down and paychecks slow down."
Tricon's only the latest casualty in what's been a long and difficult year for Montana's timber industry. Earlier this month Sun Mountain Lumber in Deer Lodge closed down the night shift in several of its operations, leaving 50 people out of work.
Julia Altemus is with the Montana Wood Products Association.
"If you go back to March 1, about 235 lumber or mill workers have been laid off. That's a huge hit to the industry and all the mills are suffering about a $2 million to $3 million loss in the first 6-months of the year. [It's not] been that bad since the first part of the great recession back in 2007/2008."
Tricon's Joe Zito says market conditions are rough right now.
"Coupled with termination of the Canadian/US softwood trade agreement. There's a big anticipation out in the market that they're going to be sending a lot of wood down here; then you've got the exchange rate on top of that. I think it comes out to about for every dollar they send down here they get $1.25 back, which is hard for us to compete with."
That softwood trade agreement was a 9-year cease-fire in a long-standing lumber dispute with Canada. It was signed in 2006 and ends October 12. After that, Julia Altemus says both countries enter into a one-year cool down period.
"So there can be no claims filed, no lawsuits filed. Nothing will happen until that one year is up. Will people try to encourage them to come to the table to renegotiate a new agreement? We hope so, but at this point further complicating the issue is the fact that the Canadian government is going to go to the polls on October 19."
Meaning nobody really knows how to proceed until the Canadian election is settled.
Montana’s timber industry has for years complained about a lack of marketable logs in the pipeline. Altemus says that’s still a valid concern.
"You have to have supply in the mills so that when we turn this around, we can start putting people back on. I think [U.S. Forest Service] Region One will probably hit close to a 300-million board foot target between Idaho and Montana which they haven’t done in many, many years, actually. So that supply would be nice, but the markets are terrible.”
Meanwhile, back in St.Regis, Tricon Timber’s Joe Zito emphasizes that none of the company’s 90 employees now out of work were terminated. All were laid off, and he says the company wants them back on the job just as soon as market conditions allow.