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Canfor closing Vavenby mill, purchasing U.S. mill

Canfor is permanently closing its Vavenby sawmill north of Kamloops this July, putting 178 employees out of work.

Canfor has reached an agreement to sell the forest tenure associated with the Vavenby sawmill to Interfor for a price of $60 million. The sale of the forest tenure is subject to customary closing conditions including the consent of the Minister of Forests. Closing is expected to occur in the third quarter of 2019.

The closure comes a week after Canfor announced it has complete the first phase purchase of 49 per cent of Elliott Sawmilling in South Carolina. The balance will be acquired in one year.

Canfor announced the purchase last fall for $110 million.

Forests Minister Doug Donaldson issued the following statement about Canfor’s closure of its Vavenby sawmill and the request to transfer tenures to Interfor:

“I was saddened to hear that Canfor will permanently close its Vavenby sawmill. The loss of any job is difficult, especially in a small community. My thoughts are with the workers and their families.

“Staff from the regional economic operations branch of my ministry and staff from the Ministry of Social Development and Poverty Reduction will work with Canfor, the workers and the community to co-ordinate the delivery of provincial support programs. We will also work with the federal government to ensure supports are made available to affected workers.

“With the recent amendments to the Forest Act (Bill 22), we will also ensure that the public interest is protected when companies seek to transfer public forest tenures.

“The challenges facing the industry have been building for years and analysts have predicted a reduction in milling capacity for some time, especially in the Interior. Declining timber supply – the result of the end of the pine beetle-killed wood, exacerbated by record-setting fire seasons the past two years – has left the industry scrambling to keep log yards full and keep people working. Weakened lumber markets and the ongoing softwood lumber dispute have contributed to this challenge.

“Our government has been working to set a sustainable course for the forest industry in all regions of the province. Last year, we launched the Coast Forest Sector Revitalization Initiative, which led to policy changes aimed at getting the best value and most jobs from the fibre basket on the coast. This spring, Premier John Horgan invited Interior forest sector CEOs to collaborate with all their partners – First Nations, workers and local governments – on innovative solutions for the industry.

“Our government believes in rural communities and we believe strongly in the resource sectors. The forest industry supports 140 communities throughout B.C.

“Despite this recent bad news, I know that working collaboratively, British Columbians will find innovative solutions to ensure a competitive, high-value forest industry that creates jobs and produces economic stability and benefits for First Nations and communities around the province.”