PHOTO BY JONATHAN HAYWARD /THE CANADIAN PRESS
Canfor Corporation, a British Columbia forestry company, has announced significant changes that will affect several communities in Northern B.C. These changes include the closure of a sawmill in Bear Lake, the reduction of production at a pulp mill in Prince George, and the suspension of plans to build a new mill in Houston. These decisions are expected to result in the loss of hundreds of jobs in these areas.
The Polar sawmill in Bear Lake, located approximately 75 kilometers north of Prince George, is set to be permanently closed, impacting around 180 employees. Operations at this mill have been scaled back since January. Canfor CEO Don Kayne attributes the decline in lumber harvests to various factors, including natural disturbances such as beetle infestations and wildfires, as well as policy changes and increased regulatory complexity. These challenges have made it difficult for Canfor to access enough raw materials to sustain its manufacturing operations, leading to the closure or reduction of several forest sector operations.
Additionally, Canfor plans to indefinitely curtail one of the production lines at the Northwood pulp mill in Prince George. This decision will result in the loss of approximately 220 jobs out of the 450 employees at the mill. The Northwood pulp mill converts wood chips into pulp and paper products. Kevin Edgson, CEO of Canfor's subsidiary Canfor Pulp, explains that the closures and curtailments of several sawmills have led to a shortage of wood chips, making it challenging to maintain operations.
Furthermore, Canfor is halting its plans to construct a new sawmill in Houston. This decision comes eight months after the initial announcement of the plan to build a modernized facility worth $200 million. The new mill was intended to replace a previously shuttered mill, with expectations of employing approximately 100 fewer workers than its predecessor. Kayne had previously emphasized the company's commitment to Houston and British Columbia. However, the company has decided to suspend plans for the Houston mill due to uncertainties about the success of such a significant investment at this time.
The challenges faced by Canfor are reflected in its financial performance, with the company reporting a loss of $117.1 million for the fourth quarter of 2023. This loss is attributed to weak global lumber market conditions, contributing to what Canfor describes as a challenging year.
Overall, Canfor's decisions to close a sawmill, reduce production at a pulp mill, and suspend plans for a new mill highlight the ongoing difficulties in the forestry industry, particularly in British Columbia. These changes will have significant implications for the affected communities, with many workers facing job losses amid challenging economic conditions.
