RE:RE:Down indefinatly !No one said anything about "0" But there is hard times ahead for the BC forest industry brought on by lack of fiber and added costs. Many jobs have been permnently lost and more to come.
In recent weeks, B.C. forestry companies have announced the closure of four sawmills, and several have eliminated, or plan to eliminate, shifts at mills that are still operating.
They include:
Canfor Corp. (TSX:CFP), permanently shutting down its sawmill in Vavenby;
•Tolko Industries, permanently shutting down its Quest Wood sawmill in Quesnel and eliminating one shift at its mill in Kelowna;
•West Fraser Timber Co. (TSX:WFT), permanently shuttering its Chasm lumber mill near Clinton and 100 Mile House and eliminating the third shift from its 100 Mile House mill;
•Norbord Inc. (TSX,NYSE:OSB), indefinitely curtailing production at its oriented strand board (OSB) mill in 100 Mile House.
Jim Girvan, a forestry consultant who estimated in 2010 that 16 Interior lumber, veneer and plywood mills would shut down in B.C. by 2019 – which is exactly how many did – more recently predicted in May that another 13 mills will have to go. Since his May prediction, four mill closures have been announced, which mean nine will follow before long if his projections are correct.
And because B.C.’s forestry sector is so highly integrated, the next wave of plant closures could be pulp mills and other processors that use wood waste from nearby sawmills.
The reality is B.C.’s forestry sector has entered a long-term contraction that will last decades.
The current wave of mill rationalization would likely have started earlier, but a strong U.S. economy drove the demand, and prices, for lumber so high that it made it economic to continue processing wood products from lower quality timber. Despite rising wage costs, American softwood lumber tariffs and added government levis, taxes and stumpage fees.
When U.S. lumber prices began to fall in 2018, Some of B.C.’s biggest forestry
companies went from posting record profits in 2018 to posting first-quarter losses in
2019.
These losses can not be sustained for the longer term. Credit lines have limits. Due to
higher costs and reduced fiber supply BC lumber manufacturing will continue, to
shrink with another another 9 to 13 mills predicted to close by 2025.
Those are just the facts like it or not. The mis managed cheap beetle wood bonanza is over.