KENORA, Ont., TBNewswatch — Kenora Forest Products is blaming a weak lumber market and American lumber duties for the indefinite shutdown of its sawmill operations.
According to a report b y TBNewswatrch, the shutdown will begin on Sept. 23, affecting about 115 employees.
In a statement, the company said “the decision to curtail the operations is primarily based on sustained weak domestic and global lumber markets which are having a detrimental impact across the forestry industry.”
It also cited a 20 percent duty deposit on softwood exports to the United States, where it ships 90 percent of its output.
The company said the duty deposits have been “very damaging.”
“As a family run business…deeply rooted in the Kenora community, the decision has been a difficult one,” it said.
Kenora Forest Products stated that it had deferred the shutdown as long as it could out of consideration for its workers.
It said it remains committed to the long-term sustainability of the sawmill and is optimistic that market conditions will improve “in the near term,” which would allow the mill to resume production.
In an interview with Tbnewswatch, manager Glen Hansson said “we are very confident and optimistic that this is short-term,” but added “the market is going to dictate that.”
Hansson indicated that the market rebound will have to be significant, however.
“If we see a climb in demand and pricing, we need that to be somewhat sustainable for us to go ahead,”
Stephen Boon, a spokesperson for Unifor, told Tbnewswatch that Kenora Forest Products isn’t the only Canadian lumber producer suffering from the U.S. duty, and said “this is obviously a problem we need to address.”
“Losing 20 percent off the top for every board foot that you produce is obviously something that is not sustainable with lumber prices at the current level,” he said.
Boon said he hopes the market will improve enough for Unifor members who work at the mill to be back on the job within a couple of months.