Soft market forces heavyweight sawmill shutdowns

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Soft market forces heavyweight sawmill shutdowns

By HBSDealer Staff - 06/12/2019
Softening lumber demand has pushed some of British Columbia’s largest lumber producers to reduce production at more than a dozen sawmills.

Last week Western Forest Products announced that it was temporarily curtailing operations at three British Columbia mills to align production volumes with current customer demand. The move includes curtailing production at its Duke Point sawmill for two weeks and its Saltair sawmill for one week in June.

Additionally, Western Forest Products is reducing operations from 120 hours per week to 80 hours per week at its Chemainus sawmill.

“The temporary production curtailments are necessary due to challenging market conditions,” said Don Demens, president and CEO of Western Forest Products. “The challenge of weak markets is compounded by the disproportionate impacts of softwood lumber duties on high value products, including Western Red Cedar.”

The curtailment is expected to reduce Western’s production by approximately 15 million board feet. Western has an annual lumber capacity in excess of 1.1 billion board feet.

This week Canfor followed Western’s announced by saying that was curtailing operations at all British Columbia sawmills, except its WynnWood facility. The company says the curtailments will reduce its production output by approximately 200 million board feet. Canfor has a total annual capacity of approximately 3.55 billion board feet following the upcoming closing its mill in Vavenby, British Columbia this July.

West Fraser, another of the lumber producing heavyweights in British Columbia, is curtailing all mill activities for one week in June at five British Columbia sawmills: Chetwynd , Quesnel , Williams Lake, Smithers and Fraser Lake.

The decision to implement the temporary reduction is due to sustained weak pricing in global lumber markets and high log costs, West Fraser said.

Lumber production is anticipated to be reduced by approximately 30 million board feet. Over the previous six months including this most recent announcement, West Fraser has implemented temporary and permanent capacity curtailments of approximately 125 million and 300 million board feet.

Last month, West Fraser also said it would temporarily shut down operations at its Chasm and 100 Mile House mills for two weeks saying the decision was necessitated by weak pricing.

Interfor also announced last month that it was reducing production across its operating platform in the British Columbia Interior in June. This curtailment is expected to reduce production in the region by approximately 20 million board feet for the month of June and will be taken by way of reduced operating days at each of the company’s three British Columbia Interior mills.

Interfor has three sawmills in the Interior, with total annual capacity of approximately 750 million board feet. The company has annual production capacity of approximately 3.1 billion board feet.

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