New $440 million wood plant planned on Iron Range

DULUTH – Huber Engineered Woods is planning a $440 million timber-based manufacturing plant near Cohasset, in a major boost for Minnesota's logging industry and the Iron Range economy.

The 750,000-square-foot mill would be located next to the Boswell Energy Center and employ more than 150 people. The North Carolina-based company expects to begin construction by the middle of next year and be in full operations by 2025.

"Northern Minnesota, given the fiber basket that exists there, the long history in the industry and the quality workforce, was an ideal fit for us," said Huber Engineered Woods President Brian Carlson.

It would be the company's sixth U.S. mill, Carlson said. Huber Engineered Woods, a subsidiary of J.M. Huber Corp., provides oriented strand board (OSB) panels for roof, wall and flooring construction.

The Iron Range Resources and Rehabilitation Board (IRRRB) voted Monday to provide a $15 million forgivable loan for the project. An additional $20 million is expected from the state.

"I think everyone understands that the [housing] markets are booming — anything that has anything to do with construction or remodeling," said Matt Sjoberg, IRRRB executive director of business development. "It's a pretty good time to be in this business, and we're more than pleased that has created some opportunity for the company and for us."

Scott Dane of the Associated Contract Loggers and Truckers of Minnesota called the project "the biggest development in the forest products industry in 40 years."

The industry suffered during the pandemic as the Verso paper mill in Duluth closed and Sappi in Cloquet cut back on production.

Nearly 1,000 Minnesota jobs were lost in forestry/logging, paper manufacturing and wood product manufacturing in 2020, according to census figures, a 5% drop in total employment across those sectors.

Even before the pandemic, northeastern Minnesota's timber industry has seen a steady decline in employment over the past 20 years. There are half as many people working in the industry now as there were at the turn of the century, according to the census.

Project advocates say hundreds of indirect jobs for loggers, truck drivers and others will be created by the mill in addition to hundreds of construction jobs.

"This will be a tremendous boost, not only to the local economy of Cohasset but to all of Itasca County," Itasca County Commissioner Davin Tinquist said in a statement. "This is good for the timber industry, for the local job market and for our tax base."

The project comes as Minnesota Power closes and converts its remaining coal plants at Boswell by 2035, which was expected to cost the region hundreds of jobs and millions in local taxes. The Duluth-based utility and its parent company, Allete, helped recruit Huber and find a home for its next mill as part of a "just transition for Boswell's host communities," Allete CEO Bethany Owen said in a statement.

The plant will consume more than 400,000 cords of wood — up to 1 million tons — annually. Aspen will be the primary species harvested, and the mill will require about 150 daily logging trucks. About 20,000 trucks and 330 rail cars annually will be needed to bring the products to market.

Huber Engineered Woods has about 1,000 employees and has more than $1 billion in yearly revenue. Its five other mills are located in Georgia, Maine, Tennessee, Oklahoma and Virginia.

Carlson said the investment comes "as we look to grow our business and satisfy the needs of homeowners across the country," who are facing staggering costs for construction products due to pandemic-related supply chain issues and soaring demand.

The Cohasset mill remains "contingent upon site acquisition, approval of certain legislative initiatives and financial assistance from additional state entities," according to a news release from Gov. Tim Walz, who said "we're excited about the positive economic impact this investment will make in the region."

The "biggest piece" still remaining is a measure going before the state Legislature that would "get permitting going quickly and allow them to get into a construction phase in a timely fashion," said Tamara Lowney, CEO of the Itasca Economic Development Corp. Legislators are still looking for a bill to carry that initiative through the special session, Lowney said.

The Legislature is also considering $27 million in annual production incentives — up to $3 million per year from 2026 through 2034.

At Monday's IRRRB meeting, chairman Sen. David Tomassoni, I-Chisholm, questioned if Huber had financing lined up.

"We have had great big projects like this that have fallen through the cracks," Tomassoni said.

"Yes, we have confirmed that," Sjoberg said. "I think it's a very fair package we've put together to get Huber to be making their investment in the area."

Brooks Johnson • 218-491-6496