More forest woes for Northwestern BC

The three month forestry strike had barely been settled and the contract offer only just ratified, when the hammer fell on West Fraser Timber's Skeena Sawmills.

West Fraser Timber citing the decline of housing starts in the US and the sudden rise of the Canadian dollar announced on Wednesday, that the Terrace sawmill would close for an indefinite period of time.

The decision puts 80 salaried workers, with no anticipated date of recall. West Fraser said that it would try and reassign the 20 salaried staff members within the company, if possible.

What isn't known yet is the impact on the 400 or so positions associated with logging in the Northwest, people who used to feed product to the area sawmills and now have less and less options for their work. With no markets for the logs, they will be the largest group involved to suffer from the closure.

The Terrace sawmill closure adds to the list of forestry related troubles in the Northwest over the last ten years, an industry that once was considered the backbone of the region is now but a shell of what it once was, with little in the way of a brighter day on the immediate horizon.

The closure announcement was covered by the Vancouver Sun, Terrace Standard and Opinion 250.

The Daily News featured the latest blow to the Northwest economy on the front page of Friday's paper.

Loggers ponder mill closure impact
By Leanne Ritchie
The Daily News
Friday, October 26, 2007

Pages one and five

The remains of the forestry industry in the Northwest suffered another blow yesterday as West Fraser Timber announced the shutdown of its Skeena sawmills in Terrace.

"This was a very difficult decision for the company to make, but unfortunately it has become necessary due to current market conditions," said Lou Poulin, general manager of Skeena Sawmills.

"These conditions include low U.S. housing starts and the unprecedented and rapid rise in the value of the Canadian dollar."

The company is uncertain as to the length of the shutdown and any start-up of the facility will be determined by market conditions.

The planer at the plant will operate on a temporary basis starting Oct. 29, 2007, for six weeks in order to process the existing inventory of rough lumber at the mill.

Skeena Sawmills employs approximately 80 hourly workers and 20 salaried staff members. Wherever possible, salaried staff will be re-assigned to other duties within the company.

The news came just as the company's workers were returning to work following a three-month strike by the United Steelworkers Union.

The $2-billion industry was idled July 21 when 7,000 workers walked off the job. They were upset about work scheduling. Twenty major sawmills and innumerable logging operations were shut down during the dispute, including West Fraser's Terrace operations.

Skeena Sawmills produces approximately 90 million board feet of dimension lumber annually on a one-shift basis.

Bill Sauer, manager of the Northwest Loggers Association, said he polled members Wednesday to find out how severe a blow the closure will be.

"What's going to happen now is a good question," he said. "We were all assuming that once the strike was over, we would be able to go out and ship fibre again.

"It's not as if this has not been expected. But it's kind of like a bad marriage. You are expecting it to end but the day the wife kicks you out of the house, it's a shock."

The Northwest forest industry has been on a long downhill slide for more than a decade. The closure of Skeena Cellulose, the region's largest forest company, in the 1990s and the subsequent failed attempts to restart it, first under government intervention, and then venture capital, was the first major blow.

The main problem is that more than 50 per cent of the timber supply in the Northwest is old and decadent, good only for pulp logs. The rest is good quality and under a program introduced by the government, contract loggers can export up to 30 per cent of their logs for a premium and then sell their sawlogs to West Fraser. They lost money on the pulp logs but were able to remain profitable as long as the other two markets were functioning.

The only bright spot, said Terrace economic development officer Sam Harling, is that the rest of the regional economy is strong. A new mine is under development and forest workers' skills are transferable to other sectors, he said.

-With files from Canwest News Service