Panel data provided by Madison's Canadian Lumber Reporter.

Weathering the Beetle Storm, Canfor Optimistic

By 250 News

Canfor CEO Jim Shepherd says his company does not see any more permanent mill closures on the horizon in the next few years, but, he cautions, the area around Prince Goegre and Quesnel could be impacted within the next seven to ten years, as a result of the beetle problem .

He says certainly Quesnel and Plateau mill operations will be impacted when the effects of the beetle infestation are felt as currently Quesnel operations are using 90% beetle killed wood.

Shepherd says about 26% of our fiber is originating from beetle killed wood which in some instances is very hard to handle. Stumpage on that wood has increased from 25 cents a cubic meter to $2.00 dollars a cubic meter and the provincial government has been looking at further increases.

Shepard says if you have to pay too much for beetle wood, then companies will begin to say they can harvest green wood and make more money doing it without the hassle.
As for the time line when the central part of the province will start to feel the effects of the loss of timber as result of the beetle kill, Shepherd says he feels the time line is up to ten years from now. He added, places such as Mackenzie, Ft. St. John, the southern half of the province, Bear Lake and Houston should weather the storm.

Referring to the closing of six mills in the past year, Shepherd says five of the mills were not financially viable and the Ft. St. James mill was closed because “We had to under our purchase agreement.”

Shepherd says the bottom line is pretty simple, “We will not run a facility to lose money.”

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