People keep talking about the “dying” forest products industry, but what they don’t realize is we’re doing just the opposite. We’re changing. You have to. You either change or you die.
When I went to work in the Rumford mill one summer to pay for college, there were five people on a paper machine that had been around for 50 years. I was the spare, so I just filled in on jobs. I trained for the second most complicated job in one day – one day!
One of my friends made $5,000 in his summer mill job, so when they offered him a full-time job, he took it. I also thought long and hard about not going back to college. It wasn’t an easy decision for someone who came from a pretty modest upbringing to pass on what was then big money for unknown earnings later.
I was in grammar school when my dad became disabled and died a few years later. My mom went to work at an insurance office. There were five of us at home, so we all worked. I had a paper route, but I couldn’t lug more than 30 papers because the bag was too heavy for me. It would drag on the ground and my mom had to keep repairing it.
In high school, I worked 30 or 40 hours a week at the supermarket and I didn’t do very well in school. But my older brother, who had two kids, went back to school to become an accountant. So I looked at what he was making, saved up a couple of thousand bucks and went off to Husson College with a lot of help from the school.
The summer I worked at the mill, I had three years to go – three years to pay for – so you can imagine how tempting those mill wages were, but my mom convinced me to go back to college. When I graduated, I made $8,000 a year and the guys I went to high school with were making three times as much in the mill. But 10 years ago, the Rumford mill downsized and several of my friends lost their jobs.
I also took a long-term view of life when I chose Prentiss & Carlisle in 1987. I had three job offers and I picked this one, even though it wasn’t the top money and top benefits. I looked at the future and the people involved and I just knew this was the best place to be.
At the time, we only had 24 or 25 employees. The Carlisles had never really hired someone for a key position from outside the company but they hired me as their financial guy. I am less conservative than the Carlisles, but they’ve been great. They gave me plenty of rope – I could have hung myself or make them a nice bow – and luckily most of the stuff worked out all right. We pushed the envelope. The entire staff at P&C works very hard and we’ve got a great team. We’re more profitable, we’re way bigger and we have a lot more timberland. We’re now up to almost 100 employees.
So I believe that we should not only expect change, but we should actively search for ways to change — wisely. Most of the mills we are associated with sell products that are global commodities. Therefore, we are tied to a world whose population is getting bigger. The demand for fiber is increasing. The ability of Maine to match markets with resource is going to be the key. We have to be able to look at where the demand is in the world and adjust to it.
The worst thing we can do is let the government steer us in a direction they think markets are going. We’ve got to let the market system drive it. Some of the markets we know and love may not be the markets of the future but we should be very careful before we give up old friends for new ones. But there is an increasing demand and we are in a good position to meet it.
- The demand for fluff pulp – toilet tissue, facial tissue and paper towels – is only going to increase. That needle only has to move a little bit when you have 5 billion people in China, or Middle East or some of these developing countries. And if we can match up with that, we should be perfectly fine.
- Housing starts are coming back. Private housing starts in October were 41.9 percent higher than in October 2011.
- The price of dimension lumber is coming up.
- We produce some of the best oriented strand board in the country.
- We have a diversity of species.
- We have a diversity of markets. We sell to 100 different mills – a hundred different mills! In New York, Wisconsin, Michigan or Canada, we deal with six mills, eight mills, 12 mills.
I know we’ve had some tough years, but right now the most important thing to understand is that none of us can be successful if one of us in not successful.
Let me tell you where the key is. We produce more pulp than Wisconsin. What’s Wisconsin noted for? It’s the number one paper-producer in the country. Why are we producing more pulp and they’re producing more paper? Because we’re selling our pulp. That’s not bad, because we currently can’t consume all the pulp. But we’re not taking it the next step in the value chain. Pulp sells for $1,000 a ton. Paper or tissue paper or any of those things when you put them in a nice fancy cardboard box sells for a lot more than that on a per ton basis.
The further up the value chain we are, the more money comes in the state and the more jobs there are. The more the mills can pay for the wood, the more the contractor can get paid. So we’ve got to go up the value chain.
If you back up and look at it from 25,000 feet or 50,000 feet, it really isn’t that complicated. We are going to be facing change constantly. The unions have changed. The pulp and tissue mills have changed — I couldn’t be backtender today on a paper machine. The players who owned the mills have changed. So what? We’re evolving. Change is constant and we’re willing to change. Yes, we’ll go head to head with the Chinese. We’ll go head to head with anybody.