Kaibab Forest Products said it will close its sawmill in Panguitch indefinitely, putting 40 people out of work.
The news came barely a week after the Phoenix-based company auctioned off the remnants of its mill in Fredonia, Ariz., which closed for good earlier this month.Kaibab officials hope to reopen the Panguitch operation, said sawmill manager Ted Atherley.
"There's not a lot of timber under contract, so we'll just wait until the weather gets better," Atherley said.
With this winter's heavy snowfall slowing the timber supply, the company hopes the market will improve enough in about two months to call the sawmill's roughly 40 employees back to work, Atherley said.
But there is a chance, Atherley said, that the mill will be closed permanently.
"I don't think it's going to get better very soon," he said.
The move is aimed at getting the mill through high costs of logs and depressed lumber market, said Kaibab President Don Olson.
"There is no question that we are deeply concerned about our employees who have faced extraordinary hardships during the past few years," Olson said. "But the reality is, we must keep the company financially healthy if we want to be around long-term."
The Panguitch mill historically has gotten its timber from the Kaibab National Forest, where environmental lawsuits have curtailed logging in recent years, Atherley said. He said protection of the Mexican Spotted Owl, a threatened species, further hampered the company's timber harvest last year.
The annual volume of timber sales on the forest has fallen from 90 million board-feet in 1984 to 8 million board-feet last year, according to the Utah Office of Energy and Resources Planning.
"I don't think it's going to get better very soon," Atherley said.
Panguitch, with a population of 1,444, is located 204 miles south of Salt Lake City.