By Keith McNeill
Canfor needs to modernize its Vavenby operation but first it needs to know if it has the support of the community. That seemed to be the gist of a presentation by sawmill manager Steve Planeta to Clearwater town council’s economic development committee on Tuesday, March 6.
“The first question Jimmy Pattison asked on his first visit here was, ‘Steve, does the community support us?'” he told the council members.
Pattison owns a majority stake in Canfor, which is North America’s second largest lumber producer. Planeta said he has always felt great support from Clearwater for the Vavenby operation.
“Not every community can say that,” he said. “There will always be differences. The question is, can we work them out?” Modernization will mean some job loss, he cautioned.
Planeta noted that he has worked in the lumber industry since 1977. During that time he has seen an operation that once employed 630 people shrink to employing just 180.
One advantage the Vavenby operation has is the variety of species available, especially Douglas fir. That enables the sawmill to sell into markets that it otherwise might not be able to, and get a better price.
Last year the operation made about $15 million profit on operating costs of $120 million.
Even though the company is making money now, it is important to remember that the lumber industry moves in cycles.
“When the days are good you make a lot of money. If they’re not, you’d better be ready,” Planeta said.
He said that it’s a contract year for the industry and we do not know if there will be a strike or not.
The Vavenby operation only gets about half of its wood supply from its annual allowable cut. The rest it needs to buy on the open market, and prices for wood are at record highs.
There should be a fair amount of salvage wood coming onto the market from last summer’s wildfires but Vavenby is not set up to process a lot of burned wood, he said. Charred wood also creates problems if any gets sent to the pulp-mill, as one small piece can ruin a day’s production.
The sawmill has a good location in some ways but not in others. For example, trucks hauling lumber from Vavenby cannot find any goods to bring the other way.
“You’ve got to pay for empties too,” said Planeta.
CN passes right by the sawmill but they find the railroad inconsistent to deal with.
“You order 11 cars and you get six,” the mill manager said.
He was skeptical about proposals to add value to the lumber. He’s seen too many added-value businesses start up, do well for a few months, and then fail, he said.
Planeta said his personal view is that timber should be processed close to where it grows.
“If you have secure fibre that’s closer to home, it would be better for everyone,” he said.