Facing low-wage overseas rivals and other challenges that already have ravaged textile makers across the Southeast, the state's paper companies, loggers, timberland owners and sawmill operators are meeting this week to see whether they can work more cohesively together to compete in the global marketplace.

As Georgetown logger and landowner Joe Young sees it, his industry has little choice because the companies that deal in forest products are so interdependent. "We need to think more like a supply chain rather than a bunch of links," said Young, owner of Low Country Forest Products.

Changing that mindset is the theme of the South Carolina Forestry Association's annual summit, where several hundred representatives are gathering to hash out what the industry needs to remain competitive and grow. The conference concludes today.

"We have only scratched the surface of where we must go," Young said.

Businesses tied to forestry make up the state's largest agricultural sector, employing more than 30,000 workers and generating $1.24 billion a year in wages. Also, timber is South Carolina's top cash crop, with a value of $835 million.

The forest business is trying to define its role in the new economic development strategy that the state adopted last year. Gov. Mark Sanford hopes to raise per-capita income levels by transforming South Carolina's strongest existing industries, such as chemicals, agriculture and tourism, into well-oiled "clusters" that will create higher-paying jobs by becoming more innovative and efficient.

The main purpose of this week's summit was to develop a "punch list" of priorities to make the forestry business more competitive, said A.G. "Skeet" Burris, chairman of the association.

Several panelists said lower insurance costs, tort reform, streamlined regulations, lower business taxes and improvements to secondary roads are high on their wish list.

Nearly every speaker stressed the need to improve the public education system.

"It's getting more and more difficult to find employees who are motivated and educated enough to operate and maintain modern sawmill systems," said T. Furman Brodie, vice president of Effingham-based Charles Ingram Lumber Co., which has 120 workers.

Mark Watkins, a senior vice president for MeadWestvaco Corp., said a South Carolina manager told him he sees too many job applicants with high school diplomas who can't read or figure out simple math problems.

"While we hear talk of progress, frankly, South Carolina should be moving faster and better to remain competitive," Watkins said.

South Carolina boasts several advantages, namely its "great platform" of existing forest-products business and its proximity to all of the high-growth markets along the East Coast, said consultant Douglas Parsonson of Jaakko Poyry.

"I can't emphasize how important that is ... for developing an industry," Parsonson said.

Ed Sellers, who is co-chairman with Sanford of the group charged with making the clustering concept a reality, said the state's new economic development model will require forest companies to think differently. For instance, businesses that now view themselves as competitors might have to share their "best practices" to make the cluster as a whole more efficient and competitive.

"That gets that productivity flywheel moving," he said.

Still, Sellers could not say whether the large and diverse forestry business could function as a single cluster. "It may be too large. It may be too complex," he said.

Sellers credited the industry for taking steps to change "the conversation."

But putting "audacious" ideas like clustering into action is the hard part, he added.

"It has to infect every deci- sion you make every day," Sellers said.

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