Potlatch Expects Third Quarter Earnings To Be Below Estimates

Potlatch chairman and chief executive officer L. Pendleton Siegelsaid the shortfall is largely attributable to the high cost of energy,exacerbated by petroleum and natural gas supply curtailments in thewake of recent Gulf Coast hurricanes. Siegel emphasized that thesecosts, which are approximately $10 million higher than third quarter2004, are impacting almost every aspect of the company's operationfrom natural gas used at its manufacturing facilities to in-bound andout-bound transportation surcharges.

Potlatch is a diversified forest products company with timberlandsin Arkansas, Idaho and Minnesota. Additional information is availableon Potlatch's website at www.potlatchcorp.com.

This news release contains, in addition to historical information,certain forward-looking statements. These forward-looking statementsare based on management's best estimates and assumptions regardingfuture events, and are therefore subject to known and unknown risksand uncertainties and are not guarantees of future performance. Thecompany's actual results could differ materially from those expressedor implied by forward-looking statements. The company disclaims anyintent or obligation to update these forward-looking statements.