Canfor Looking to Increase Sales to China

Saturday, July 31, 2010 07:13 AM

Prince George, B.C. - Canfor is planning to spend $100 million dollars in capital improvements to its sawmills this year, in an effort to improve the quality of the product being produced.

Canfor CEO and President Jim Shepard says there are two key areas for the capital expenditures “First of all, we're making very focused investments to improve the cost competitiveness of our mills but we're also investing specifically those mills that have a good future with green fiber supply.” He did not offer specifics on which mills will be receiving the benefit of those upgrades, but senior staff say the upgrades will be focused on several key mills and specific projects.

Shepard says the company is very encouraged by the growth of the Chinese market. He says the volume of shipments to China is “growing almost exponentially” and there is also growth in the shipments of higher quality product. Shepard says they initially were shipping low grade lumber to China for mostly concrete forming, but that has moved into a higher value use “And that is very significant because we see that continuing to happen. That's just basically the improving awareness of the advantages of building with wood in China.”

Shepard points to the Quesnel mill which has reopened to produce lumber that is specific to the needs of the Chinese market. “This is a first for our company, we have never before dedicated an entire sawmill to one country.” He says this not only demonstrates the confidence Canfor has in the future of China, but also, “It is part of our strategy to diversify our markets.”

During the first half of this year, 24% of Canfor’s SPF lumber sales were to offshore markets, and half of that amount was to China. That represents a one third increase to Canfor’s offshore sales compared to the same period in 2009.

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Posted on Saturday, July 31, 2010 07:13 AM in News by 250 News

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Comments

Posted by: DPJ on July 31 2010 9:49 AM

Aren't many of Canfors mill soly for USA?

Posted by: Retired on July 31 2010 7:52 PM

They also also minning the taxpayers which is very profitable.
Cheers

Posted by: Palopu on July 31 2010 9:43 PM

The Quesnel mill apparently makes **mill run lumber**. That is rough lumber of different dimensions. This is then sold to the Chinese who run it through a planer etc; and make whatever they want. I suppose it is cheaper for Canfor to use up the beetle kill for this type of lumber, and get the benefit of the chips, and hog for their pulp mills.

No mention of the fact that they just shut down the finger joint mill at Clear Lake and laid off 15 people.

Significant upgrades to some mills, probably means that another mill will close in the area.

Times are pretty tough in the lumber industry, without the US housing market, and Japanese sales we are hooped.

Notice that no one ever mentions the Price that this lumber is being sold for to the Chinese.

You can get the price for lumber sold to the US and Japan in Madisons, however I cant seem to find anything on Chinese lumber. I suspect that these are negotiated prices and not for public edification.