By: The Working Forest Staff
Business In Vancouver — Canfor Corp. has joined other major forestry companies in cutting it production at sawmills, slashing capital spending and deferring retooling and upgrades.
The cuts and curtailments are in response to the COVID-19 pandemic, which not only puts workers at risk if they continue to work in settings where they cannot practice social distancing but also has disrupted supply chains and reduced the global demand for lumber.
“Our principal focus is ensuring the safety and well-being of our people through these unprecedented times while taking the necessary actions to protect the long-term sustainability of our business,” Canfor CEO Don Kayne said in a press release.
Beginning March 30, Canfor will take 70 million board feet out of production from its Canadian sawmills over a three-week period – a 40% reduction.
“These reductions will be implemented across several British Columbia sawmills through a combination of temporary plant curtailments and reduced operating hours,” the company said in a news release.
Canfor has 10 sawmills in B.C. and pulp and paper mills in Prince George and Taylor.
Canfor will also take 50 million board feet out of production from its American sawmills, and 17 million board feet from its mills in Sweden.
The company will slash capital spending by $20 million in Canada and the U.S. The company’s budget for 2020 was already reduced, compared to 2019. Overall, the company will spend $100 million less in 2020 than it did in 2019.
On its pulp side, Canfor Pulp will shut its Northwood Pulp Mill, which had been scheduled for a maintenance shutdown, for three weeks. Canfor Pulp will reduce its capital spending by $15 million.
Depending on the duration of the pandemic and the impacts on the economy, Canfor said it might be forced to take further measures.
“There is the potential that further adjustments to operating plans may be required as a result,” the company said.
Other large forestry companies also announced similar curtailments and capital spending cuts in recent days.
Western Forest Products, West Fraser Timber and Interfor Corp. all announced temporary mill closures or production curtailments recently.
In total, the curtailments announced by Canfor, Interfor, and West Fraser total 182 million board feet of lumber being taken out of production in Canada and the U.S.
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