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FI Insights

BREAKING: Impact of COVID-19 on America's Forest Supply Chain

September 02, 2020

The global forest products industry has been making headlines since the COVID-19 pandemic struck at the beginning of 2020. First, the pulp & paper sector was the talk of the town during the widespread run on toilet paper that took place from March - June, and the lumber sector has been front-page news in recent weeks as prices for finished lumber have set new records by huge margins.

But the myriad impacts related to the COVID-induced shutdown of the American economy continue to unfold, as they will for months to come. While the attention is beneficial in helping to educate the public and illustrate the complexities of the forest supply chain, those of us close to the industry have wondered about the degree to which COVID-19 “lockdowns” have impacted forest industry production and economic activity.

Forest2Market was recently commissioned by the American Loggers Council (ALC) to identify just how significant the impacts have been to America’s forest products supply chain.

Forest2Market research shows that wood raw material consumption between January-July 2020 was 6.7% lower than the same period in 2019 – dropping by 21.4 million tons of material. This resulted in a 13% reduction ($1.83 billion) in value of the delivered wood. That $1.83 billion dollar loss in value has had a significant impact throughout the forest supply chain, from timberland owners to loggers and truckers.

 

COVID-19 Impacts to Delivered Wood Raw Material

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Unfortunately, as the ALC notes, both Congress and the United States Department of Agriculture (USDA) have provided funding for numerous agricultural categories, but they have not yet classified timber in the category that qualifies for COVID-19 assistance. Timber and forests are described as agricultural commodities along with fruits, vegetables, and other common agricultural goods (7 U.S.C Section 1518).

To help highlight the impacts of COVID-19 on the US logging and wood products supply chain, the ALC created SaveOurLoggers.com as an outlet that features testimonial stories and videos directly from those who have experienced difficult circumstances.

 

In Washington, bipartisan Logger Relief bills have been introduced in the Senate (S.4233) by Senator Susan Collins (R-ME) and Senator Tina Smith (D-MN), and in the House (H.R. 7690) by Representative Jared Golden (D-ME) and Representative David Rouzer (R-NC). Specifically, the bills would direct the USDA to make economic relief payments to logging and log trucking businesses who experienced losses of greater than 10% in the first two quarters of 2020 (compared to 2019). Members of Congress from 13 states have co-sponsored the Logger Relief Act.

economic impact resource studies

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