Conifex Timber Inc. to upgrade recently acquired El Dorado sawmill

VANCOUVER (Scrap Monster): Conifex Timber Inc. has decided to upgrade its recently purchased El Dorado sawmill in the Southern US. According to company sources, better prices in the US have prompted it to perform upgrades at the mill ahead of the idled Mackenzie Site 1 sawmill. Further, it stated that the modernization and upgrade of its Canadian sawmill will be the second in its priority list.

According to sources, the company had been assessing both the facilities for a potential upgrade and has finally decided to give top priority to the Arkansas mill. Ken Shields, President and CEO, Conifex stated that although the two projects look similar, there is a striking difference in selling price between the products from these mills. The cost of production remains more or less the same, he noted. However, selling price in the US is approximately $400 per thousand board feet, whereas in Canada it is only $270 per thousand board feet.

The uncertainty over the future of the Softwood Lumber Agreement (SLA) between the US and Canada has also acted as a reason for the company deciding to give first priority to El Dorado mill. Better pricing situation in the US is expected to benefit the company, In addition, the operations at the Southern US mill are free of risks associated with extension or amendment to SLA, Sheilds observed. The availability of abundant fibre supply presents an opportunity to upgrade and modernize the mill operations at Mackenzie Site 1 sawmill, Sheilds added.

Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution. Conifex's lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Conifex has expanded its operations to include bio-energy production following the commencement of commercial operations of its power generation facility at Mackenzie, British Columbia.