Canfor mill in Houston to resume full operations Jan. 3

Canfor optimistic about improving markets

Canfor is returning its Houston sawmill to full operations on Jan. 3, 2022, ending cutbacks which first began over the summer.

“Currently, we have limited staff performing special projects and preparatory maintenance work,” said Canfor external relations senior advisor Rosemary Silva last week.

“We’re encouraged by the market outlook while closely monitoring the global supply chain congestion and making adjustments in operations to reflect the weather and transportation conditions in B.C.”

Production cuts began in the summer when the mill shut down in late July for two weeks and opened Aug. 9 when bottlenecks in the rail system caused by the wildfire situation in southern B.C. meant the company could not get its product to market.

Wildfires not only disrupted rail traffic but very dry conditions resulted in federal authorities limiting the speed trains could travel in order to reduce the possibility of sparks causing new fires.

Canfor then began Friday closures the end of August in response to what company officials called challenging market conditions.

Houston was not the only Canfor operation affected by wildfire-related transportation challenges and a dip in lumber markets as other of its facilities in B.C. and Alberta also experienced production cuts.

Those production cuts followed record sales and profits at the beginning of the year when lumber demand — and prices — soared as homeowners and others undertook renovations and other work while homebound because of the pandemic.

With the planned resumption of full operations on Jan. 3 underway, Canfor two weeks ago announced the $420 million purchase of Alberta-based Millar Western Forest Products Ltd.

The acquisition of two sawmills and a specialty millworks facility will add 630 million board feet of capacity to Canfor and access to what the company calls a high-quality timber supply.

“We are excited to expand our Alberta operations to meet the growing demand of our customers for high-quality and sustainable wood products,” said Canfor president Don Kayne.

The deal is expected to close in the first quarter using Canfor’s existing cash and liquidity.

“Canfor expects to generate at least $25 million in annual synergies principally related to alignment with the company’s marketing programs and operational enhancements,” a company statement indicated.