John Shelk
January 1995Originally, before there was ever a sawmill built in Prineville, there was Ochoco Timber Company. It was a group of men from the timber industry who bought a tract of timber in Crook County in 1924. The group included my great grandfather, O.M. Clark; The Collins family from Collins Pine in Portland; The Booth family from Eugene; and a number of other families who were minor owners.
The group that formed Ochoco Timber company had planned to build a large sawmill in Prineville. Due to a number of circumstances after the 1929 stock market crash, including the death of my great-grandfather, those plans were interrupted. In 1938, another group of people came in to start a sawmill and contracted to cut the timber owned by the timber company. That group founded Ochoco Lumber Company. The principals were Wilford Lamm, Roland Watt, and the Tennant family from Long-Bell Lumber Company of Longview, Washington.
My great-grandfather had timber and sawmill interests, one of which was Clark-Wilson Lumber Company, in Linnton just down the Willamette River from Portland. My father, Stuart Shelk, was in his mid-20's and working in the office of Clark-Wilson Lumber Company. It was assumed that he would have a fairly large role in the family business. That all changed when the company went into receivership and his grandfather died. He could see that all of the plans that had been laid out for him were not going to come to pass. He could see the family empire crumbling. Eight years after his grandfather's passing, he made the choice to come to Prineville to work for Ochoco Lumber Company which wasn't even a mill yet. It was just a group of people who had formed a company to build a sawmill in Prineville. He was hired by Wilford Lamm as bookkeeper and office manager.
And so, in 1938, his life took a very marked turn from what was going to be a comfortable urban existence in Portland, Oregon. He was going to go from a guaranteed job in his family's company to what then was considered to be the wild West.
In 1944 my father was appointed general manager of Ochoco Lumber Company and later became president and chairman. The same year Ochoco Timber Company and Ochoco Lumber Company merged.
Early on, Father set the tone for the company by demanding it be run in a very frugal manner and in a very responsible, business-like manner. I can recall when he would take letters into the office to mail. When he used the company postage machine, he always put that nickel or the seven or eight cents in a little box to pay for the postage. And this was something that was carried on to the other people in the company. It was a strict sense of what's right and what's wrong. Maybe even taken to extreme lengths. To one degree or another we've carried on certain elements of that.
I think the defining experience in my father's life had been the Depression and the fact that his family had been a very wealthy and powerful family in the timber industry. Their business was, to a large degree, destroyed by the Depression. That made him cautious and, yes, penny-pinching and very, very driven to succeed in a fiscally responsible way. Since taking over the management of the company in 1977, I've had to engage in more risky activities than he would ever have participated in or even condoned. This is because of the times we're living in.
My father retired in 1975 but continued to have an active role in the company. Darrel Williams followed father as general manager.
After completing high school, I received a bachelor's degree from Willamette University in mid-1967. I had plans to go to law school the following fall but the draft board had other ideas. During the Vietnam War, if you weren't in graduate school you would be drafted. In 1967 every slot in every graduate school was filled. Three days ahead of getting drafted, I enlisted, and the Army and Vietnam interfered with my going on to graduate school.
After getting out of the Army, my father asked me to come back to Prineville. He would give me a job in the mill office for a period of time while I sorted through things and decided what I wanted to do with my life.
In the office there was sort of a logical progression. I learned all the clerical jobs in the outer office starting from timekeeper to log accounting, to invoicing, and, later on, I moved to bookkeeping and putting together the financial statements.
I don't think there ever was a particular time that there was a conscious choice as to where I wanted to be until October of 1977 when Darrell Williams suffered a heart attack. I had been back here since mid-1970 and was given the title of assistant manager. Darrell's severe heart attack was followed by double by-pass heart surgery which kept him away from the office for a long time. And so, at age 33, I became interim general manager. After it was recognized that Darrell could no longer endure the stresses of the job, he stayed on a limited basis until I was sufficiently educated to take things over.
There were some political things involved in the transition. One family which had a 25 percent ownership in the company had in mind putting one of their people in charge. Although I didn't recognize it at the time, there was a little bit of politics being played within the company to keep one of their people out of management and to give me an opportunity to stay in. It was felt among the management team that those who had come up through the ranks would be more capable of running the company.
As mentioned earlier, my father initially was against expansion but when he saw how well our John Day operation turned out he began to believe it wasn't such a bad idea. It was in the 1980's that we began looking at our raw material base and recognized that we were fairly vulnerable being located only here in Prineville. We felt that we needed to branch out to make the company grow. We had the necessary staff and a budget within which we could work. In 1983 we expanded to John Day with a modern new mill, Malheur Lumber Company. It has a combination of new and used equipment but it is a very up-to-date mill. We've continued to update the equipment there and it is currently the most efficient mill we have. It employs 105 people and produces about 40 million board feet a year.
We continued expanding by buying a mill in Princeton, Idaho, 25 miles north of Moscow. It is a small mill producing about 15 million board feet a year compared to the 45 to 50 million board feet produced in the Prineville mill. Then we went overseas and built a mill in Lithuania, a country adjacent to Russia. There is a huge resource of timber in Russia that we believe can be tapped from Lithuania, that cannot be reasonably tapped from within Russia right now because of its social and economic situation.
In 1987 we broke ground for the small log mill here and it was in operation in 1988. It is a highly computerized small log mill capable of changing from a domestic size board to a metric (Japanese) size board with a ten minute reprogram in the computer. Another of its features is an overhead carriage with a number of scanning cells tied to the computer that first scans the log and then determines how to position the log. From there the log is carried through a series of slabber heads and band mills and cut into boards.
To sum it all up, Ochoco Lumber Company is made up of five facilities in four locations. The primary facility is here in Prineville. We've been operating at this site since 1938. The original mill that was built in 1938 still stands and it is still being used on a daily basis in a much changed interior but the exterior shell still looks the same. The old powerhouse, with its boilers that originally were used in 1938, is still providing steam to dry the lumber. We have a rather old planer that is planing the large lumber in the planing mill. To that, we've added a small high speed planer to do a lot of the export work that comes out of the small log mill.
We've moved into the export markets where particularly the Japanese have demanded a precisely machined and precisely dried stable product. We've been able to satisfy Japanese customers for many years. We got started in the Japanese markets in the 1980's. With the small log mill we knew there would be a lot of narrow material to sell. In addition to our already established markets for ponderosa pine, we wanted to develop markets in white fir and lodgepole pine. It was largely through the efforts of Ron Wilson, head of our marketing department, that we developed the market with the Japanese. It was in response to trying to find specialized markets for the products from our small log mill. At first we had a lot of trouble trying to dry white fir to Japanese standards, but we finally came up with the precise method for getting this lumber dry throughout the various seasons.
We've been shipping to European customers since the late 1960's. We have just recently acquired a new customer from Thailand and have shipped lumber to China, Taiwan, Egypt and throughout all of western Europe.
At the same time we built the mill in John Day we were also competing for timber. We've gone great distances to get timber. In the late 70's we hauled logs 200 miles from the Yakima Indian Reservation. We have gone as far as South Dakota by rail. I hasten to add, however, that the South Dakota logs didn't work out. They were too expensive. Right now, we have trucks hauling logs into our John Day mill from eastern Utah. We go wherever there is availability and the opportunity to buy timber. We have even looked at timber in Baja, Mexico with the idea of barging it up the Columbia River and then trucking it to John Day.
Some of our national environmental laws contain loopholes that when originally written couldn't be foreseen. These loopholes provide opportunities to challenge the application of various laws and to tie up decisions in courts for lengthy periods of time.
When the Act was passed in the 1970's and various National Forest Management Acts were passed, they were hailed by the timber industry as a good thing; it was believed it would bring certainty to the question of timber supply. The timber industry really believed that this was a step in the right direction. They couldn't foresee that there would be appeals filed to halt the process. There are loopholes in the laws that need to be fixed.
Perhaps the timber industry has been irresponsible by over-harvesting in the past and we're probably paying for those indiscretions. When my great grandfather came out here clear-cutting, going through an area and harvesting everything, was an accepted practice. Those areas that were harvested so heavily around the turn of the century are now terrific growing timberlands that have had one and sometimes two crops taken from them. What can be seen in these areas now are beautiful growing forests. The point is, trees are a renewable resource.
We survive by buying private timber from wherever we can get it; buying what little Forest Service timber is offered and cutting some of our own timber. The Ochoco National Forest once sold up to 140 million board feet a year. Most recently, it has sold three to five million feet a year. I believe it will one day again sell between 40 and 60 million feet. Our challenge is to survive until that time.