State forestry official: Vermont’s forest economy is shrinking processing capacity even as standing timber grows

Catherine Studio, forest economy program manager at the Vermont Department of Forests, Parks and Recreation, told the House Agriculture, Food Resiliency & Forestry committee on Oct. 12 that Vermont’s forests are producing more wood than is being removed while primary processing capacity and the number of mills in the state have declined.

“Right now … we’re at 2.9 to 1. So we’re growing almost 3 times more wood than what we’re moving from our forests,” Studio said, summarizing Forest Inventory and Analysis-derived data and the department’s 2022 harvest survey.

Studio said Vermont is about 76% forested—roughly 4.5 million acres—with most timberland in private hands and an economy where the forest products sector is the state’s third-largest manufacturing sector by output in 2017 data (the department is updating those figures). She said most forests are northern hardwoods (maple, beech, birch), many stands are similar in age, and that slower growth and increasing mortality are reducing net growth rates even as standing volume increases.

The department’s 2022 sawmill survey counted 39 operating sawmills reporting, compared with more than 100 in the early 2000s. Studio said that harvest volume processed in Vermont in 2022 was roughly 89,000 Mbf (thousand board feet) harvested in-state, with about 80,000 Mbf processed in-state and additional imports and exports in regional trade flows.

Studio listed multiple stressors affecting harvests and the supply chain: fewer local processing options (mills, pulp markets), regional and international market uncertainty and tariffs, higher overhead and energy costs across jurisdictions, reduced logging seasons and access because of warmer, wetter winters and summers, interest-rate effects on construction demand, and workforce constraints. She said those pressures can push landowners and loggers to the sidelines.

On policy and program responses, Studio described the department’s Forest Future strategic roadmap and several implementation efforts. She said the Forest Economy program obtains and awards grant funding, supports advanced wood heating projects for institutions, and coordinates regional work to develop markets for innovative wood products. Studio told the committee the department recently secured implementation funding and was piloting capacity-building for climate-adaptive practices: “We just got a very large grant of $5,000,000 and part of that is doing underserved landowner outreach, but also doing contract writers for foresters to put climate adaptive practices into management plans.”

Committee members asked about the causes of the 2.9:1 growth-to-removals ratio, whether it reflects reduced harvest because of fewer mills or natural forest growth, and market flow maps showing exports north to Canadian processors. Studio said it is a mix: some decline in removals because of lower harvest, partly due to fewer local facilities and shortened logging seasons, and some natural slowing of growth as trees age. She repeated that the ratio was rising (from 2.7 in 2018 to 2.9 at the most recent inventory) and said the department is working on roadmap implementation to strengthen markets and workforce capacity.

Studio and the committee discussed pilot funding to subsidize forester and logger costs for climate-adaptive planning and implementation; Studio said other private and foundation funds can also help pay for practices.

The presentation closed with committee members asking for additional briefings, maps and follow-up on the roadmap and mill capacity.