Belgrade lumber mill starts four-week shutdown

The Louisiana Pacific lumber mill in Belgrade began a four-week shutdown today and temporarily laid off 112 of its 125 employees.

By KAYLEY MENDENHALL Chronicle Staff Writer

"It is due to the current lumber conditions," said David Dugan, corporate spokesman for Louisiana Pacific. "There has been an over-supply and prices have been down for the past year.

"It’s necessary to take this down time to adjust inventories for hopefully a better season next year," he said.

Louisiana Pacific, which makes studs for new homes, has often shut down when the building season slows in the fall.

But this is a longer sabbatical than in years past, said Bill Fleming, plant manager.

Last year, the corporation shut down all of its North American facilities for two weeks at a time. This year, only the Belgrade and Deer Lodge mills are affected in Montana, along with two mills in Idaho.

"The laid-off people will get their holiday pay from Louisiana Pacific and their medical benefits will be continued for this time," Fleming said.

Out-of-work employees will not be paid for the month off unless they use vacation time.

Louisiana Pacific, a Portland, Ore.-based corporation, announced in May its intentions to sell its lumber business. But because bids came in lower than expected, Dugan said the company decided to take eight of its 12 lumber mills off the market.

"We made an announcement in late October that we have received all the bids for the lumber mills and they didn’t reflect the value of the mills," Dugan said. "We’re certainly not going to sell them for less than they are worth."

In order to relieve some debt, the company hoped to sell its existing assets for about $600 million. Louisiana Pacific still plans to sell its particle board mill in Missoula to a Roseburg, Ore., company by the first of next year, Dugan said.

Because there is more lumber available than demanded, prices for the commodity have continued to drop, Fleming said.

"This is market related," he said of the shutdown. "And we hope that by taking this step, this will help take some of the pressure off and bring prices up to the level where we can afford to operate."

Kayley Mendenhall is at [email protected]

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