First in a six-part series
In January, Canfor announced the impending closure of its Chetwynd Sawmill and Pellet Plant. In February, Canfor Pulp, a subsidiary, announced that the shuttered Taylor Pulp mill is not likely to reopen.
Canfor CEO Don Kayne gave two rationales for the closure of Chetwynd: “…to match our mill capacity with the economically available fibre for harvest,” and, “…that fibre currently processed at the Chetwynd facility is utilized to support other local and regional manufacturing facilities, helping them to be more sustainable.”
A similar rationale was given for the Taylor closure: “As a result of a reduction in the long-term supply of fibre in the Peace region, the Company does not see a path forward to restarting the Taylor mill at this time.”
In short, there’s insufficient wood fibre available to keep all mills operational, so they picked one for closure to make the others more viable.
They also announced a mill closure at Houston but are looking at rebuilding a newer and smaller version to replace it. Although some may portray Canfor as an insensitive and uncaring company, there are legitimate reasons why they made their decisions and, not so coincidentally, reasons government chooses to ignore. Since those announcements many good questions have been asked.
So, what happened? Are there really no trees left? Have all northeastern B.C. forests been logged? Why not take Canfor’s timber tenure and give it to someone else who will operate a manufacturing facility?
To understand why is to understand timber supply, how it’s calculated, and the factors affecting the determination of the Annual Allowable Cut (AAC), which is used to determine how much timber is available for harvest. It also helps to understand the business side of the forest industry, and what keeps it sustainable.
I used to be there. It used to be part of my job as I worked for Canfor in Chetwynd and have a good knowledge of the local forests. For 10 years I was employed in their woodlands department, in charge of planning and permitting. Although I no longer have any affiliation or ties to Canfor, or the forest industry, I stay interested and follow it closely.
Chetwynd also has a special place in my heart as it was one of my favourite places to live and work. I was Chetwynd’s mayor for nine years, which helps with the understanding of the politics that dominate our public land forests and forest industry debates.
The rise of industrialization
Modern industrial forestry began in northeast B.C. in the 1960s. Prior to then, many small saw and planer mills were scattered across the north, primarily cutting for local needs. Most were family owned and cut their timber during winter when the ground was frozen and access roads easily constructed. Some was milled on site, some hauled to wherever the mills were located.
In those years, anyone could apply to the government for permits to cut timber and, if you met its objectives, be granted rights to harvest. Generally, if one wished to obtain multi-year rights, then government stipulated one must agree to own and operate a manufacturing facility. That contract was called appurtenancy.
As demand and competition for timber rights grew, the government developed a process to determine the amount of timber cut on an annual basis (AAC) while keeping our supply sustainable in perpetuity. This process has been continually refined over the years and is still used today.
A bit of recent history, with my apologies if I got any of the company names and dates wrong. The Peace District, part of the Prince George Forest Region, includes the Dawson Creek Timber Supply Area (TSA), Fort St. John TSA, and Fort Nelson TSA. Each used to be their own Forest District, with each having its own AAC.
These three Districts were amalgamated during one of the government’s downsizing exercises. License to harvest timber were/are issued to various entities to cut timber with each license limited to its respective TSA. Our forests are managed by the Ministry of Forests.
Dawson Creek TSA
In 1963, Canadian Forest Products (Canfor) bought a number of small mill operators in the South Peace, including Fort St. John Lumber Company, and built the Chetwynd Sawmill, its second in B.C. In 2016, their pellet mill was opened on the same site. Canfor holds timber rights in Tree Farm Licence (TFL) 48 and a joint forest licence with West Moberly First Nations in the Dawson TSA.
In 1978-79, West Fraser purchased Northern Wood Preservers in Dawson Creek and Chetwynd Forest Industries in Chetwynd. In 1980, both mills were replaced by one new mill at its current site in Chetwynd. West Fraser has a large coniferous forest license in the Dawson TSA.
In 1987, Louisiana-Pacific (LP) opened an Oriented Strand Board plant (OSB) in Dawson Creek, which continues to operate today. Their hardwood tenure in the Dawson TSA supplies most of its wood. In 1990, LP opened the Chetwynd Pulp mill and operated until it closed in 2001. It was then sold to Tembec Inc., which reopened it in 2003 and operated until 2012. In 2014, it was purchased by Paper Excellence, upgraded, and reopened, and then closed again in 2015 and its components subsequently sold by auction.
In 2022, Peak Renewable purchased the former pulp mill site with plans to remediate the land and repurpose it for other industrial uses. Some of the pulp mill hardwood tenure is used for the Dawson Creek OSB plant while some remains unharvested.
Fort St. John TSA
In 1981, Canfor purchased the Fort St. John Sawmill, at its current site, from Swanson Lumber. They also bought the Taylor Sawmill in Taylor from Balfour in the same year but closed that mill shortly thereafter and used its timber tenure to supply the current Fort St. John mill.
The Taylor Pulp mill was opened in 1988 by Fibreco Pulp and purchased outright by Slocan Forest Products in 1998. In 2004, Canfor purchased Slocan and became the new owner of the Taylor Pulp mill. It operated until spring 2022 when it temporarily shut down due to markets and transportation issues. Canfor announced its “permanent” closure in February 2023. Canfor has multiple forest tenures in the Fort St. John TSA.
The Fort St. John OSB Plant was originally a joint venture between LP and Slocan. Just prior to its completion in 2005, Canfor purchased Slocan and replaced them as a partner. LP bought out Canfor’s share in 2012 and has operated it ever since. LP has forest tenure in the Fort St. John TSA.
Cameron River Logistics Ltd (CRL) operates a small sawmill and remanufacturing facility in Taylor and forest tenure in the Fort St. John TSA.
Fort Nelson TSA
In the early 1970s, Sikanni Forest Products built a small sawmill in Fort Nelson. In the late 70s, Tackama Forest Products opened its sawmill and plywood plant and later, Fort Nelson Forest Industries opened another sawmill.
During the 1990s, Slocan Forest Products purchased both Tackama and Fort Nelson Forest Industries. They closed the sawmill in 1995 and built the Fort Nelson OSB (Polar Board) plant in 1996. Canfor purchased Slocan in 2004. Canfor then closed both the plywood and OSB plants in 2008.
In 2022, Canfor sold its forest tenure to Peak Renewables. The Northern Rockies Regional Municipality and Fort Nelson First Nation currently hold a joint venture forest tenure. No manufacturing facility operates in Fort Nelson as of today.
For the past 50 years, our forest history has been mostly about small mills being bought up to allow for larger mills to be constructed to process timber that was offered for sale by the province, with a couple exceptions. The Chetwynd Pulp mill and mills in Fort Nelson were closed due to economic factors rather than timber supply constraints.
Today’s announcements have turned that around, as facilities are now being closed due to timber supply constraints rather than economic conditions.
Next week, Part 2, appurtenancy, mountain pine beetle and changing government regulations.
Evan Saugstad lives and writes in Fort St. John