USDA Forest Service offers extension of timber contracts
April 30, 2020
Last week, the U.S. Department of Agriculture’s Forest Service offered to extend contract deadlines on certain timber sales, sale of property stewardship contracts and forest product permits awarded or issued before April 1. Extending these deadlines supports the long-term viability of the timber industry in markets where conditions have been significantly disrupted, especially in rural, forest-dependent communities. The extensions do not apply to projects implemented under the Good Neighbor Authority or the salvage projects currently underway on the Seeley Lake Ranger District.
This decision is based on a combination of factors that have affected the national economy and the timber market, including the global COVID-19 pandemic.
“It’s about global markets and supply. With operators [from the west coast] producing volume every day, there is less volume going to the Asian realm. So that means the volume they produce stays in the U.S. That keeps the markets flooded in the U.S. which drives prices down too,” said Pyramid Mountain Lumber, Inc’s Resource Manager Gordy Sanders. “In regards to COVID-19, some states have restricted contractors working on construction. This just creates a complex situation that is impacting everything.”
Individual purchasers of the timber sales contracts may request extensions – up to two years in the lower 48 states and up to three years in Alaska – or continue to work to meet their obligations.
This deadline extension option also offers relief to businesses scheduled to make timber sales payments on April 15. Without the extension, firms and individuals who bought timber sales from the Forest Service may find themselves in default from late payments.
Detailed information about the contract deadline extension is published in the Federal Register.
The Forest Service adopted the procedures to extend contracts in the early 1990s to avert contract defaults, mill closures and residual effects on forest-dependent communities. Most Forest Service timber sale contracts of more than one year contain these provisions.
“It gives everyone a little more wiggle room to find their way through these difficult times,” said Sanders. “It’s nice to see people looking out for the industry.”
USDA has taken many immediate actions to assist farmers, ranchers, producers, rural communities, and rural-based businesses and organizations impacted by the COVID-19 pandemic. For more information on these actions, visit www.usda.gov/coronavirus.