My mother's family used to farm apples in southern New Hampshire. Pretty much every year, the farm lost money, but in the last decade, the global economy killed off the orchard once and for all. When fresh Brazilian apples started showing up in local New England supermarkets in the middle of winter, and the Chinese moved into the apple juice market, the end was nigh.

That kind of bruising competition from far-off lands wasn't new for New Hampshire. I can remember walking through New Hampshire forests and seeing the low stone walls that used to mark the boundaries between sheep pastures. But cheap wool from Australia and New Zealand wiped out New Hampshire sheep farmers long ago, and today most of that pasture has returned to forest.

So it wasn't too much of a surprise for me to learn this morning that the New England forestry products industry has come under severe pressure from global competition in the last decade. Undercut by the dual challenge of cheaper raw materials from overseas and the migration of domestic furniture makers offshore, New England forestry companies have seen their margins get ever tighter.

Enter the Fractionation Development Center, a nonprofit based in Rumford, Maine, that is pushing a "forest biorefinery" proposal that would not only offer new life to New England forestry, but would also, more important, help to wean the region from fossil fuels. According to executive director Scott Christiansen, the FDC just completed a biorefinery feasibility study that concluded that within 15 years Maine could produce 50 percent of the transportation and heating fuel the state consumes. Ultimately, the plan would include more than 60 biorefineries statewide and employ some 7,000 people. In addition to producing fuel, the biorefineries could also manufacture an array of chemicals aimed at replacing those currently derived from fossil fuels.

It's a seductive notion -- a sustainable system of forest management in which commercially unprofitable trees, sawmill scrap and even sludge from paper mills becomes ethanol and diesel and a host of other useful products. There's just one catch. To work, the plan requires advances in pyrolysis, gasification and fractionation technologies that are not quite ready for prime-time deployment.

Pyrolysis refers to a process of very quickly heating wood (to around 500 degrees) and then cooling it, resulting in char, gas and a liquid substance called bio-oil. Gasification is another technology that uses similar techniques to produce a range of chemical byproducts. Fractionation -- referred to by the authors of the report as "the holy grail of biomass conversion" -- separates biomass into yet another group of components that can be transformed into industrially useful chemicals.

Christiansen says that the technologies are "sufficiently advanced" that work can start right away on a pilot refinery that would start working out the kinks. Talks with potential partners are ongoing.

Federal funding has played a key role, in the form of legislation titled "The Maine Forest BioProducts Initiative." But it's not hard to argue that this is precisely the kind of sector the government should be pouring major resources into. If the U.S. is looking for new markets to be competitive in, developing state-of-the-art biofuel refining technologies is an obvious choice.

Christiansen points to Sweden, which has set a goal of completely self-sustainable biofuel energy by 2020, as a model for Maine, noting that Maine has a higher forest-per-capita ratio than Sweden does. But he also acknowledges that Maine's model wouldn't work for other states in the U.S. where trees are far less plentiful.

Still, now is the time.

"We have reached the tipping point for significant industrial investment in the renewable energy sector," says Christiansen. "The thing that changed was not the maturation of technology -- which is forging ahead at breakneck speed -- the thing that changed was the acceptance of high energy costs over the long term and we are now seeing the logical capitalist response."