Canfor’s Canal Flats sawmill to close its doors in November

VANCOUVER (Scrap Monster): Canfor Corp. on Wednesday announced its decision to permanently close its Canal Flats sawmill. The mill’s last day of operation would be November 9^th. The closure will affect 65 workers and 9 staff members.

Effective May this year, the company had cut two shifts to one. The shortage of economically available fiber has resulted in lack of sufficient timber supply to the mill, forcing the company to reduce the operating capacity at the mill. This had led to nearly 80 layoffs. However, workers were under the belief that the mill would survive. The decision to permanently close the mill came as a surprise, said Doug Singer, president of United Steelworkers Local 1-405.

The company spokesperson blamed poor market conditions for the closure. The sharp downturn in oil and gas and lumber markets coupled with shortage of fibre has led to unsustainable operating loss, said Corinne Stavness. Meantime, the company assured all support and assistance to affected workers. All workers at the mill will be offered job at company’s other facilities, said Canfor president Don Kayne.

The lumber exports from Canada to China has witnessed considerable cut back in the wake of Chinese economic slowdown. The rise in lumber production by North American mills has resulted in sharp decline in lumber exports to that region. The most recent statistics released by the Western Wood Products Association indicates that lumber prices have plummeted by 29% during the initial eight months of 2015. At the same time, half yearly data suggests 8% year-on-year jump in lumber production. Incidentally, Interfor had decided to cut production at all sawmills in the US South by one-fifth in the wake of huge drop in market demand.

The Canal Flats sawmill with 1780 members has existed on the current site for over 85 years. Canfor Corp had purchased the mill from Tembec nearly three years ago.