JOHN DAY, Ore. — Rich Fulton watches a worker feed a piece of rough-cut lumber onto the planer at Malheur Lumber on Jan. 7, his eyes locked on the man’s practiced movements.

“That’s the last board right there,” says Fulton, the John Day sawmill’s general manager.

He tracks the board’s progress through the planer until it comes out at the end of a line of finished lumber moving down the conveyor, then snaps a photo with his cellphone.

Farther down the line, four workers pull the final batch of boards off the conveyor and stack them on the cement floor of the vast, mostly empty planer building. A forklift scoops up the pile and whisks it off to a corner of the 70-acre mill yard, where 1.5 million board feet of finished lumber awaits shipping.

After 42 years of operation, Malheur Lumber is shutting down.

Most of the mill’s employees have been laid off in phases over the last six months, and another 26 will be laid off the next day, leaving just Fulton, two office personnel and two production workers to preside over the silent facility.

“It’s a sad time,” Fulton says.

Sale remains possible

In July, Prineville-based Ochoco Lumber, Malheur’s parent company, announced plans to shut down the John Day sawmill, citing a shortage of workers, poor market conditions and other factors for the decision.

At the time, Malheur had 76 employees, down from about 100 when the mill was fully staffed.

Ochoco’s announcement said Malheur Lumber would permanently close after it finished processing its remaining log inventory — a day that came on Jan. 7.

Hopes were raised in October when a local logging company, Iron Triangle LLC, announced it was exploring a plan to buy the mill if it could obtain enough government funding to make the purchase economically feasible.

While no deal has been reached so far, the sale remains a possibility.

“We’re still in discussions,” Iron Triangle spokesperson King Williams said.

Ochoco representative Bruce Daucsavage said talks with Iron Triangle were “very positive” but added that the proposed asset sale was complicated and could take awhile to complete.

“We continue to do further negotiations and our due diligence,” he said. “We’re positive things are going in the right direction.”

Hanging over those negotiations, however, is the shadow of potential litigation.

A group calling itself the Malheur Forest Fairness Coalition, which includes the Prairie Wood Products sawmill along with several Grant County logging outfits and timberland owners, has vowed to block the sale. 

The group previously filed a $117 million antitrust suit in federal court, claiming Malheur Lumber and Iron Triangle had created a de facto monopoly over sawlogs in the region and were colluding to stifle competition. That lawsuit was dismissed but is under appeal.

Economic fallout

With Malheur Lumber shut down, that leaves Grant County with just one remaining sawmill, Prairie Wood Products — one of the key players in the coalition that is threatening to block Malheur’s sale to Iron Triangle.

But Prairie Wood is experiencing its own struggles.

A subsidiary of D.R. Johnson Lumber Co. in Riddle, Prairie Wood reopened in mid-2022 after a 15-year hiatus but then shut down again in March 2024. The Prairie City mill restarted a few months later on a limited basis, with only about 15 employees. 

“Right now we’re running out some logs we have in inventory. It’s kind of day by day,” said Trent Middlebrooks, the company’s chief financial officer. 

“A lot depends on the market — really, all of it depends on the market,” he added. “We’re doing our best to try and stay viable.”

Given the current state of the timber industry, it’s not entirely clear that Grant County can support two sawmills, even if market conditions and labor issues improve.

What is clear, though, is that if Malheur Lumber does not reopen — either under Iron Triangle or some other owner — it will deal a major blow to Grant County’s economy.

An analysis released in September by the Oregon Employment Department found that permanently closing the mill would trigger a cascade of direct and indirect impacts that would ultimately result in the loss of 206 jobs and $58 million a year in economic activity in the county.

The Grant School District calculated the mill’s closure would result in the loss of at least 60 students. That means the district would also lose more than $700,000 a year in state financial support, forcing it to lay off teachers and cut back on sports, electives and other programs.

The employment department’s analysis did not predict what the economic fallout would be if Prairie Wood also were to shut down.

If that happens, the only wood products manufacturing facility left in Grant County would be Iron Triangle’s post and pole plant in Seneca, which makes fenceposts and similar products out of small-diameter logs.

Going dormant

While Malheur Lumber was working its way through its log decks, some employees were tasked with getting the mill ready for shutdown. 

As various parts of the mill went offline, they were cleaned up and closed down, left to lie dormant until the day comes when they might be needed again.

“We call it putting the place to bed,” Fulton said. “If there’s a future buyer, it’ll be in somewhat decent shape.”

Now that production has ground to a halt, Fulton and his remaining skeleton crew will focus on shipping out the finished lumber that’s still stored on the site — pine boards ranging from 4 to 12 inches wide, in an assortment of random lengths.

“And we’ll continue to clean up and kind of have things ready for the next adventure in life for the mill, whatever that may be,” Fulton said.

As for Fulton, who turns 62 next month, he’s not sure what his next adventure in life might look like.

He’s spent the last 36 years working for Ochoco Lumber, starting in Prineville and transferring to the John Day mill in 1999. He became manager in 2015.

Fulton has kids and grandkids in John Day and doesn’t want to leave, but he’s far from certain that staying will be an option, even if the mill reopens under new ownership.

“Just because somebody comes in doesn’t mean I will work for them or they will have me,” he said. 

“There’s not a lot of opportunities in John Day,” he said. “My guess is I’ll either have to travel or move.”