Paper mill closure rocks industries

LUKE, Md. — Among western Maryland’s logging companies, Brian Beitzel sees his family’s outfit, JBEA Logging, as one of the strongest.

He’s about to find out if that’s true.

Loggers and forestry workers across the region were sent scrambling in early May after the Verso Corp. announced it is closing its 131-year-old paper mill in Allegany County due to a shrinking paper market, import competition and the cost of new environmental regulations.

It’s a devastating development for Western Maryland, local and state officials said, where the mill is a crucial economic driver. But it’s also one of the largest buyers of roundwood and chips in the regional forestry industry, and its closure could have dire consequences for loggers, foresters, truckers and other support workers across the state.

“We’re a strong company, but it’s going to be tough, and a lot of people aren’t going to make it,” Beitzel said.

The mill’s shutdown could immediately hamper forestry work in the region and deal a severe blow to an industry already struggling with the closure of several sawmills and other recent setbacks. Karen Gailey, a forester in Southern Maryland, said she’s working with four landowners who want to thin their loblolly pine stands by removing small-diameter trees that crowd the forest and inhibit growth.

She hires loggers to harvest the pulpwood, truck it away and sell it — typically to the mill in Luke.

“Right now, everything’s on hold,” she said. “I don’t know what’s going to happen.”

The mill, one of seven owned by Ohio-based Verso, produces nearly half a million tons of glossy paper for magazines and other products each year. It bought from more than 200 suppliers, mostly in the Virginias, but also from Pennsylvania and Maryland.

“The loss of that mill is going to be felt very directly by too many people,” said Dan Rider, stewardship manager with the Maryland Forest Service. “It’s going to be very bad, and it’s going to be statewide. It’s going to be regional.”

State and regional officials, including Rider, participated in a town hall meeting at the Garrett County Fairgrounds in McHenry on May 14 to address the closure. Several hundred people, many of them loggers, truck drivers and foresters, packed the venue, state Sen. George C. Edwards said.

“The (mill’s) tentacles reach out pretty far, and we’re told by our economic development people that each job there affects three jobs in the community,” the western Maryland legislator said.

Edwards said he’d like to see Verso sell the mill, though it’s unclear if there are interested buyers. A buyer would have to honor the mill’s recently signed contract with the United Steelworkers Local 676, which represents more than 500 of the mill’s workers, said Greg Harvey, union president.

Kathi Rowzi, a Verso spokesperson, said the company is ready to listen to offers, but state officials said nothing concrete has materialized yet.

The mill was a casualty of a shrinking paper market, Rowzi said. North American demand for the kind of paper made by the mill — known as coated free sheet — has declined 5 percent a year for the last five years, and the rate of decline is accelerating, she said.

Paper industry reports blame consumers’ shift from print media, such as magazines, to digital outlets. Verso also cited rising costs, an influx of imported paper and regulatory demands as additional reasons for the shuttering.

When the company decided to close the plant, it was considering improvements to bring the mill’s sulfur dioxide emissions — measured with air monitors around the mill — within federal standards, Rowzi said. The company decided those improvements were too expensive, she said.

It’s not the first mill Verso has closed. The company closed a similar factory that employed more than 300 people in Wickliffe, Ky., in 2016. Last year, the mill was bought by a Chinese-owned paper products manufacturer, which has promised to reopen it, creating 500 jobs.

“We’re doing everything we can to support our employees at Luke,” Rowzi said. “We’re working with state and local agencies to make sure they have access to all available assistance to them, and we continue to do so.”

Garrett County and state officials organized a job fair that included more than 70 regional companies on May 14 in Westernport.

Forestry industry leaders said they’re hoping the closure serves as a wake-up call to the state. The industry has been deteriorating for years, they said, and it needs help. Dorchester Lumber Co. in Linkwood, Md., closed last month. Cropper Brothers Lumber Co., another well-known Eastern Shore operation, closed in 2017.

Forestry advocates have also been begging the governor’s office to build a new wood-burning power plant on the Shore to replace one it’s removing from a Somerset County prison as it shifts to natural gas. The prison consumes about a third of the Shore’s yearly wood chip production.

“We’re very hopeful that this will get the attention of people as far as how important these markets are to the forestland,” said Beth Hill, executive director of the Maryland Forests Association, which represents private landowners and other forestry interests.

The sawmills, the Luke mill and the prison paid for forest management across the state, she said. That activity helps keep forests healthy through “thinning” — removing pulpwood and other trees that can crowd and stress a forest, making it more susceptible to pests and disease.

Forest management also provides income for forestland owners — an incentive to preserve the land, not develop it. It’s also essential to the health of the Chesapeake Bay, environmentalists say, as it filters and cleans the water, acting like a sponge. Forests also capture nitrogen from the air, preventing it from flowing into tributaries and the Bay, raising nutrient levels.

It’s also a renewable energy resource — useful for Maryland, which seeks to get 50 percent of its energy from renewable resources by 2030, Hill said.

“It’s too important for too many reasons to just let it go away,” Rider said. “It’s important for the economy. It’s important for jobs, particularly rural jobs, which are as rare as unicorns. And it’s important for the environment.”

To maintain their business, loggers such as Gregory VanMeter of St. Mary’s County, Md., will have to move quickly. Each week, he cuts about a dozen 25-ton truckloads of pulpwood from Southern Maryland forestland and delivers it to Luke.

VanMeter, who took over VanMeter Pulpwood Inc. from his now-deceased father, has built a niche as one of the only pulpwood loggers in Southern Maryland. The company has supplied the mill for more than 50 years, he said.

“Not having that outlet there is going to hamper me a lot,” VanMeter said.

He has another buyer in mind — Pixelle, a manufacturer of high-quality inkjet paper in Spring Grove, Pa. The company was previously known as P.H. Glatfelter until it was sold last year to a private investment firm and renamed.

“I think they’re going to take some more of my production, but I don’t think they’re going to take it all,” VanMeter said.

Beitzel and his family are in a similar position. He typically trucked three to four loads of pulpwood to Luke each day. He’s aware of another mill in Ohio, but it’s nine hours away, and there’s another in central West Virginia. But there’s no way they’ll be able to absorb all the loggers from Luke, he said.

He’s 35 years old and has been a logger since high school. His father is a logger, and so was his grandfather. He expects to continue. Last week, he was rushing through several thinning projects to ship as much pulpwood to Luke before Friday, when the mill was scheduled to stop accepting wood.

“You got to love it to do it really,” he said. “It’s just a lot more stressful now. There’s just a lot of things in the back of your mind. A lot more worries.”