Canfor's Vavenby sawmill will be shutting down this summer as the company cites a slow market, high costs and supply issues.
The announcement means more than 175 Canfor employees will be out of work.
“Due to the current and long-term log supply constraints we face in the Vavenby region, along with the high cost of fibre, we have made the very difficult decision to permanently close the sawmill," Canfor president Don Kayne states in a press release. "The ongoing depressed lumber markets have expedited this decision."
He adds the decision was also impacted by the decreases to the annual allowable cuts following the Mountain Pine Beetle epidemic.
The forest tenure associated with the mill will be sold to Interfor for $60 million. Canfor will continue to operate 12 sawmills in Canada following the Vavenby closure.
“We deeply regret the significant impact to our employees, contractors and the communities, and will be working to support them through this difficult time," Kayne adds in the release.
The Minister of Forests, Lands, Natural Resource Operations and Rural Development, Doug Donaldson, has issued a statement following Canfor's announcement, expressing concern for the small communities affected by the closure.
"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 coordinate the delivery of provincial support programs," he says in the statement. "We will also work with the federal government to ensure supports are made available to affected workers."
He adds the forestry industry, in general, is facing challenges. He also identified the weak market and timber supply as two significant factors.
"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," he states. "Weakened lumber markets and the ongoing softwood lumber dispute have contributed to this challenge."