Clear Full Forecast

Canfor's Pres Optimistic

By 250 News

Monday, October 30, 2006 09:52 AM

    
Canfor CEO Jim Shepherd says his company thinks beetle kill wood will be good for harvest between 10 and 25 years.

"The wood in the sandy dry zones should last upwards of 25 years while trees that are still standing in a wet area could last as long as 10 years" said Shepherd.  "We also will be able to harvest other fibre.  There is still a forest that has healthy spruce and pine so even though it looks bad when you fly over it,  there is still fibre there".  He says the industry should  challenge itself to see what it can produce besides dimension lumber.

He admits, the  drier beetle wood has posed challenges  for mills "There is no question, the drier, brittle cracked wood means there is a more delicate operation through the mill, but we still have a lot to learn about the quality of the timber."

Looking ahead Shepherd says it’s a huge unknown, but predicts  the industry will make adjustments, for instance, "instead of operating with 3 shifts we will be operating with 2."

In today's market where there is such a demand for skilled labour, Shepherd says there is  always a risk that  when temprary shutdowns are announced, workers will pack up and head to other places for employment , "It definitely plays into the decision of whether we take down time or not. We don’t want to be losing people to the Oil and Gas sector in Alberta. "

The bottom line though says Shepherd is that  production has to be scaled back to better balance the supply and demand "There has been some movement to that end with the US lumber mills, the Europeans are now taking some down time and  here in Canada we are doing our part."


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Comments

In this industry, that is always a given, otherwise the ROI would be much higher and the shares would be worth much more. To many unknowns.
Jim got a lot of ëxperts" to back him up? Or is he just a good ol' optomist way down deep?
Oops! I meant optimist. Faulty keyboard.
If Shepperd follows through and goes to 2 shifts from three we can count that as about 400-600 direct primary jobs in the Prince George region. The equivilent of shutting down two large mills.

We can recoup half of that if the airport plans go through as planned, but the remainder I guess were counting on the oil and gas industry, mining, or a container port?

My question is when will the gap begin and when will it close? How wil this effect realestate wealth in the local economy?