Canada's Millar Western Forest Products will curtail its Quesnel River Pulp mill in British Columbia, which can produce 375,000 tonnes of softwood pulp a year, for an indefinite period and terminate the employment of the workers affected.
The length of the curtailment will depend on market conditions and the availability of economic fiber supply, Executive Chair and Chief Executive Karl Meyers wrote in a letter to employees on Monday, the Quesnel Cariboo Observer reported, citing a copy of the letter. The company reviewed all alternatives before concluding that an indefinite curtailment was the only viable option at this time, he wrote.
The mill in Quesnel has been idle since September 4. Millar Western told employees in August that it planned to restart on November 1, citing sustained weak demand, poor pricing, reduced order volumes and tariffs, and in late October extended the stoppage to December 1.
Millar Western will complete an orderly shutdown of the rest of the operations over the next several weeks, "setting it up for a potential restart in the future," Meyers wrote. Under its contractual obligations, the company will keep the effluent system running for twelve months or until it reaches an acceptable alternative.
About 90 workers are affected, CBC News reported. They will receive severance compensation, continuation of certain benefits and access to assistance programs, and the company will look at filling vacancies at its other operations with displaced employees, according to the letter.
Quesnel River Pulp is one of three Millar Western mills, alongside Whitecourt and Slave Lake in Alberta, with combined capacity of about 1 million tonnes of bleached chemi-thermomechanical pulp a year. Atlas Holdings, the U.S. owner of Millar Western, bought the Quesnel and Slave Lake mills from West Fraser Timber in 2024 in a deal that included a long-term fiber supply agreement for Quesnel River Pulp.
In July, the Government of Canada provided a C$100 million loan to Millar Western under its Large Enterprise Tariff Loan facility. The company sends 93% of its sales to Asian markets, primarily China.
Heavy industry, including the mill, accounts for 53% of Quesnel's tax base, and the city will also lose a C$150,000 revenue grant from BC Hydro tied to the mill's electricity use, Mayor Coralee Oakes said. The curtailment "is going to have a significant impact on the province meeting the targets that they've set forward," she told the Observer, referring to Premier-designate Lorne Doerkson, who has pledged a minimum annual timber harvest of 45 million m3.
Low pulp prices and tight fiber supply have shut or idled other pulp mills in British Columbia this year. In July, Canfor said it would shut its Northwood pulp mill in Prince George, British Columbia, removing 300,000 tonnes of northern bleached softwood kraft pulp capacity. Domtar indefinitely curtailed its Howe Sound pulp mill in the province in August.