B.C. Forest Industry Take a Hit from Escalated Operating Costs

The pulp mills, that depend on sawmills for their operations, too have taken a hit.

SEATTLE (Scrap Monster): The B.C. forestry sector has been hit hardly by the unprecedented rise in operating costs. The tremendous jump in stumpage rates too has contributed to the extremely high operating costs. Incidentally, fibre costs have surged higher by 33% in the B.C. Interior, as compared with global average price rise of 7% between 2016 and 2019.

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According to Susan Yurkovich, CEO of the Council of Forest Industries (COFI), the sector witnessed a series of sawmill curtailments and closures since the beginning of last year. The region saw permanent closure of as many as six sawmills. Also, several mills were forced to extend their production curtailments. The crisis situation caused by the coronavirus pandemic further worsened the situation, she said. The pulp mills, that depend on sawmills for their operations, too have taken a hit, she added.

The most recent announcement came from Paper Excellence, which decided to shut down its pulp mill in Mackenzie indefinitely. The indefinite curtailment is closely linked with the indefinite closure of Canfor Corp. sawmill in Mackenzie, which had been the main supplier of wood waste to the Paper Excellence pulp mill. As per studies, the B.C. region has reported exceedingly high number of closures and curtailments, as compared with other provinces, COFI noted.

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