To British Columbia;
After 18 months of searching for a different solution, Canfor announced today that we will be permanently closing our sawmill in Quesnel, B.C., in March 2014. This closure impacts 209 Canfor employees who have persevered through the US economic slowdown and pine beetle epidemic, and kept the mill profitable. It is an extremely challenging time for our organization, our Quesnel employees and their families, and for the community itself.
Our Quesnel facility has been one of the key mills behind the success of our China market program, and we deeply regret that this closure decision is necessary. It was through the dedicated effort of our employees in Quesnel that Canfor was able to produce lumber from some of the most heavily mountain pine beetle-impacted fibre in British Columbia, and ship 100% of it to China. We are extremely proud of what was achieved here, and are saddened to see it come to an end.
Closing a profitable sawmill is very difficult, but there is simply not enough fibre remaining in the Quesnel area to support all of the mills in the community. While we considered every option – including harvesting areas currently constrained for environmental reasons or bringing in wood from longer distances – these would only have delayed the inevitable.
Another key part of the decision to close our Quesnel mill was choosing what to do with our tenure rights. It is in the best interests of the community of Quesnel for the tenure to be utilized and not held indefinitely after the closure. We also want this to be the last mountain pine beetle closure we take at Canfor, so we looked for a Quesnel operator who would be willing to exchange tenure in one of our other operating areas, allowing us to safeguard the future of another Canfor mill, in this case Houston. As was also announced today, we have entered into an agreement with West Fraser that allows us to strengthen our fibre position in Houston while they do so in Quesnel.
Canfor will not walk away from the Quesnel employees who have given so much to our organization. We have pledged to every member of our Quesnel team that they will be offered a position at another Canfor division. For those that choose to remain in the community, Canfor will work with our regional competitors and other employers to find positions for as many of our employees as possible.
Labor demand within Canfor and across the forest sector is high, and we are confident that we will able to place our employees quickly.
I recognize that some may question our decision to close this mill, and I want to state very clearly: if there was an option that would allow us to keep a profitable mill in operation, we would have found it. BC’s government has taken all possible steps to manage the impacts of the mountain pine beetle epidemic while developing new offshore markets and ensuring a forest policy framework that allows our industry to be globally competitive. That our industry had Chinese customer opportunities to support our companies, workers and communities through the US housing market collapse was largely the result of government policy and market development work of a decade ago. It is critical that this work continue.
While adjusting sawmilling capacity to fibre availability following the mountain pine beetle will be a difficult transition, B.C. will continue to have a strong and vibrant forest sector into the future. Ensuring our sawmilling capacity matches the sustainable supply of fibre is an essential part of safeguarding the future of the industry, and we appreciate the support of government, our communities and our employees as we move forward.
Vice-President, Brand and External Relations