Tolko Industries announced two weeks of unscheduled downtime at its Lakeview sawmill operations.
“Significantly high log costs in BC and a lack of available economic fibre continue to impact our ability to run at a higher capacity,” says Troy Connolly, Vice President of Solid Wood. “While our goal is to ensure consistency and stability for all of our operations, the steep decline in lumber demand and upward cost pressures in the province unfortunately make this a necessary decision.”
Employees were notified earlier today that the last day of production will be Friday, May 19 and operations will resume on Monday, June 5. Lakeview’s shipping and planer operations will continue to operate during the downtime.
“This downtime affects our employees and we do not take this action lightly,” says Connolly. “We have an extremely committed workforce at Lakeview whose families and communities rely on Tolko and the BC timber industry. We will continue to support our employees during this challenging time.”
Approximately 50 employees will be impacted and the potential for approximately 10 million board feet of lumber will be removed from production.
Pino Pucci, Vice President, Tolko Marketing and Sales, assures customers that Tolko’s Marketing and Sales team “will continue to work for our customers and do our best to minimize any impacts. Our customers are understanding of current market conditions and aware of our ongoing commitment to serve them.”
The Lakeview Lumber Division was acquired by Tolko in 2004 as part of the purchase of Riverside Forest Products. Prior to that, the location operated as Lignum. In November 2017, fire devastated the mill and destroyed the sawmill portion of the operation. Since that devastating evening, the mill has been redesigned and rebuilt, and is now a modern, competitive facility that is well-prepared for the future. Currently, the mill employs 190 people and operates near our Soda Creek mill, which is also in Williams Lake. The sawmill production capacity amounts to 230 million board feet of SPF and FIR lumber.
In January to March 2023, Canada's exports of lumber declined by 5.0% y-o-y to 7,686 thousand m3. The value of exports also dropped by 52% to $1,572 million, and the average price of lumber decreased by 49% to $205 per m3, according to Lesprom Analytics.
BC mills have been hit the hardest, with at least 1.7 billion board feet of announced capacity curtailments in 2022 and additional mill closures in the first quarter of 2023. Russ Taylor Global notes that the closures are mostly a result of increased log prices and falling lumber prices, along with government policies that are impacting the industry. BC mills accounted for around 70% of North America's curtailments in Q1 2023, with the rest of Canada's production remaining flat in January.
