Canfor Disspells Rumours of Pulp Mill Shutdown
Prince George, B.C.- Canfor representatives were before Prince George City Council last night, to give them an update on the state of the company.
Councillor Terri McConnachie asked if there was any truth to the rumours that one or more of the pulp mills will be facing a shut down.
Stephen Mackie, Senior Vice President for Canfor, says while there are some challenges, “I cannot see any shutdowns in the near future” he said the rumours, are, just that rumours, and there is no truth to them.
Canfor took the opportunity to share with Council the success they have had in making improvements to the air quality in Prince George.
The addition of a collection system has reduced sulphur emissions by 80%, since 1980 ( see graph at right) while new technology ( addition of a precipitator) has reduced particulates by 66%. ( see graph at bottom right)
MacKie says the company is benefiting from the low Canadian dollar, but there are challenges because of the downturn in the global economy,
Mayor Lyn Hall wanted to know more about the US investments the company has made as it now owns 10 mills in the States, and about the softwood lumber agreement.
Expanding U.S. holdings is “Part of our strategy for market diversification” says Mackie. “We had a small position in the south east U.S. a number of years ago, and we have grown.” He says the products produced in the U.S.
As for the Softwood Lumber agreement, Mackie says “We are optimistic there will be an agreement by the middle of next year.” He says the industry’s stance has been to end it all together, or extend the one that just expired. “Right now we are in a 12 month standstill” says Mackie which he says is, in effect, a free trade position.
Comments
The talk about the air quality seems like a “hey look a squirrel!” distraction. I was thinking about buying one of those new condos by the park but maybe now I will wait and see if there is any substance to this.
I would like to see the chart that shows the fiber supply of a pulp mill and how that fiber stock could be used in other configurations bringing value to the region through diversification of markets and complimentary processes.
Each pulp mill uses a tremendous amount of fiber. Could a pulp mill equal 2-3 fiber board plants, a plywood plant, pellet plant, ethanol plant, and a co-gen? If so how many would that type of operation employ verses that of a pulp mill? I would guess the employment numbers would be near equal, just employed in a different process.
As the fiber supply and the companies have been monopolized over the last few decades; I don’t think the change brought us market stability, employment opportunities, or increased local value. One can’t help but think of the free enterprise market that once was with all the multitude of companies that all fell to the wayside, or were gobbled up by the Wall Street hedge funds over time.
We are at a point now where Canfor is pretty close to the government when it comes to the Prince George fiber supply. Canfor decides who succeed and who is on the outs; and through its control of the market hinders the diversity of new market entrants in the value added chain. Canfor now controls everything and that which they don’t control they either target for shut down or take over through their market size.
I would like to know if a pulp mill does shut down, then what happens to the wood supply for that pulp mill? Does it just transfer to the remaining two pulp mills? Or does some of their fiber supply become available to new market entrants that could make new investments in PG… presumably further out from the local air-shed, like out Salmon Valley.
If a pulp mill does close that is a lot of jobs, but at the same time if the wood is still processed through more diversity of operations, and we see a reclamation of a mill site, then I don’t think it would be as bad a set back as it would first appear.
Canfor and West Fraser are the two largest operators in BC, and likely Canada. I kind of like the idea of them slowly chewing up US mills.
Is there ownership in the States change things up here. Not a heck of a lot. The amount of fibre is limited all around North America. The amount of consumption of lumber is steady. Thus the mills in the states only supply local markets anyway. Thus those are already established and not attainable by BC wood anyway.
Long term benefit. Well Ketcham and Pattison will bring money back to Vancouver. They also have the ability to shut down mills to create shortages as well. ;-)
Canfor has a lot of job posting listed, are they filling them?
There still has to be a MARKET for any of those alternate products, Eagle. And more importantly, one that can pay enough for them to allow all the costs to be recovered in price. Is there? If there was, and any of them offered financial returns better than putting the same fibre through a pulp mill, history seems to indicate it wouldn’t be very long before that fibre would be diverted in that direction. And that would be true whether Canfor or other major players controlled it or not.
When they say their US Mills sell to the local markets, they mean the US Market, which is the same market that BC sells into. So in effect we are in competition with those Canadian owned US Mills.
If one of the pulp mills in Prince George was to shut down, I would expect that one of the other one’s would be upgraded to use most of the fibre, and they would upgrade their co-generation plants, and sell the surplus power to Hydro.
near future means November December and maybe January, but come February that is no longer near future anything then is possible.
People got to learn to read between the lines of double speak.
Out of 3 pulpmills which ones are the most effecient???
Why doesnt anybody answer my questionhmm
pgguru.
I would say that Intercon and Northwood pulp are the most efficient money producers.
The PG Mill is both Pulp and Paper, and services two different markets, and is therefore subject to more ups and downs in the market. PG has the biggest Co-Gen operation, so at the end of the day. Who knows??
My question is pg co gen moveable??
PG takes most of the rail traffic, almost all its chip fiber comes in by rail. So my guess would be that PG stays open and they move the Intercon chip dumper up to Northwood. Northwood has needed a mega dumper for years now with half their chips delivered by self unloader.
No PG Cohen is not moveable. If PG shut down they would have to keep the cogen how it is, which would cut down its efficiency of being linked to the mill.
Whats the head count at intercon
I think it’s only 400 employees, but it’s real value is the value it adds to sawmills and loggers in the bush producing the spilt off value of chips that enable more value from the log.
I know Canfor has canceled or nixed some whole log chipper operations for the near future… So that would tie into the idea they will not have a shortage in the months ahead….
You guys crack me up. Same old group of speculators and naysayers.I honestly think by your comments that few, or none of you, have ever worked for Canfor,(Quite probably, not even in the forest industry)It`s like reading an issue of Women`s Weekly when there is nothing else in the stall.
Palopu:-“When they say their US Mills sell to the local markets, they mean the US Market, which is the same market that BC sells into. So in effect we are in competition with those Canadian owned US Mills. ”
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Which goes a long way to giving lie to the American lumber lobby claims that sawmills in the US cannot possibly compete with Canadian mills that are supposedly being ‘subsidised’ by getting cheap government owned timber up here. Those Canadian owned US mills are not only competing they’re being expanded by their new owners in preference to further expansion in BC.
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