SIC 2411 Logging

Contenidos

• NAICS CODE(S).
• INDUSTRY SNAPSHOT.
• BACKGROUND AND DEVELOPMENT.
• The Spotted Owl Controversy.
• Winners and Losers.
• The South.
• The Global Picture.
• CURRENT CONDITIONS.
• INDUSTRY LEADERS.
• WORKFORCE.
• RESEARCH AND TECHNOLOGY.
• FURTHER READING.

SIC 2411

This category covers establishments primarily engaged in cutting timber and in producing rough, round, hewn, or riven primary forest or wood raw materials, or in producing wood chips in the field. Independent contractors engaged in estimating or trucking lumber, but who perform no cutting operations, are classified in non-manufacturing industries. Establishments primarily engaged in the collection of bark, sap, gum, and other forest products are classified in SIC 0811: Timber Tracts; SIC 0831: Forest Nurseries and Gathering of Forest Products; and SIC 0851: Forestry Services.

NAICS CODE(S)

113310

Logging

INDUSTRY SNAPSHOT

Logging, among the oldest of American industries, has become one of the most controversial. A diverse group of economic entities and individuals are involved in logging. Among the participants are the giant, integrated forest products firms like Weyerhaeuser and Plum Creek Timber, which may own millions of acres of private timberlands; small sawmills that may harvest relatively few trees on federal lands for their own use; and independent cutters, who are compensated according to the number of trees they are able to distribute to mills. Logging activities are thus distributed among different types of firms and individuals, but they also can be integrated with other operations within a single, large company.

Environmentalists have severely attacked harvesting practices, and they have scored significant victories. The strife between the industry and its opponents ignited in August 1990 when the federal government listed the northern spotted owl as an endangered species and developed rules to ensure its survival by protecting government forests in the Pacific Northwest. The net result was severe restrictions: logging was prevented within a 2,000-acre radius around a known spotted owl nest, the largest trees in that zone had to be left uncut around a 500-acre area, and logging was prohibited within a 70-acre area around a nest. Ever since, the industry has been engaged in ongoing court cases, political wrangling, and regulatory proceedings to retain logging rights on government lands.

Although the size of the nation's forestlands has remained fairly constant for the past century, the growing stock of hardwood and softwood tree species has increased, jumping nearly 50 percent between 1953 and 2006. The southern United States accounts for the largest share of forestland, followed by the northern and Rocky Mountain regions.

BACKGROUND AND DEVELOPMENT

In the United States logging is older than the nation itself, and wood products have played a central role in the economy's development. The clearing and revival of the U.S. forest has been extraordinary. The land area of the coterminous United States is 1.9 billion acres. Between 822 and 850 million acres, or about 45 percent of the country's land area, was originally covered by forest. By 1920, owing to agricultural clearing, lumbering, and other activities, the original cover had fallen to about 470 million acres, of which only 138 million acres were original forest (some 250 million acres were significantly disturbed through grazing, cutting, and burning and could not sustain second growth, while 81 million acres were nonrenewable and nonrestoring). By 1977, however, because of better management, the suppression of fire, replanting, and other factors, the trend had reversed—the commercial forest had grown to 483 million acres. The U.S. Forest Service estimates that there were 490 million acres of timberland in 1992.

Logging in the great forests of the Pacific Northwest was started by the Hudson Bay Company at its Fort Vancouver trading post on the Columbia River in 1820. In 1825, the Royal Horticultural Society of London sent out a Scottish botanist, David Douglas, to the area; he returned to England with a sprig of what is now the most important commercial tree of these forests, the eponymous Douglas fir. Logging as an industry began in the region at the time of the Gold Rush, which produced a new market for timber in California. It was the timber barons from the East who saw the potential of the Pacific Northwest forests. Most famous among them was George Weyerhaeuser, who incorporated his company in 1900 in Tacoma, Washington. Often a pioneer in the industry, Weyerhaeuser began the practice of hand-planting new trees on clear-cut lands in 1938.

Most of the nation's timber supply has come from softwoods, which are used predominately in housing construction. In 1987, approximately 35 percent of the nation's softwood lumber came from sales of timber on federal lands in the Pacific Northwest. By 1992, that contribution had dropped to 25 percent. Sales of timber from federal forests in the region fell from 6.0 billion board feet in 1987 to 1.5 billion in 1992.

The curtailment of harvesting on federal lands had a disparate impact on firms in the wood products industry. In general, the major forest products companies performed poorly during 1991 and had mixed results in 1992, as the recession took its toll. In the first half of 1993, however, large firms that had extensive land holdings of their own recorded sharply higher earnings, as they benefited from the price increases that accompanied shrinking supply. Other companies, however, including many small sawmills without timber assets, faced increasing margin pressure as their raw material costs rose. In 1995 and 1996, wood product companies held their own in the face of continued flat prices. In 1995, wood chip demand from the paper industry and a strong level of Canadian imports created an oversupply of lumber and held back a return to stronger conditions. However, the...