B.C.-based West Fraser Timber Co. Ltd. says it plans to indefinitely curtail work at its northern Alberta mill.
The move is expected to affect 190 employees, but the Vancouver-based wood products company says it will try to find them work at its other operations.
West Fraser says the cuts at the High Level mill will happen in the spring, after an orderly wind-down and consumption of its existing log supply.
It said the decision is the result of a significant weakening in demand for oriented strand board (OSB), which is used in residential construction for things such as sheathing, sub-flooring, roof decking, along with repairs, remodellings and industrial applications.
The company is expecting to take a $200 million charge in its fourth-quarter results due to the reductions at High Level.
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West Fraser also said it will indefinitely idle one of its production lines for oriented strand board in Georgia, which has been off-line since late 2023.
West Fraser Timber reported a net loss of US$204 million in its third quarter results released in October, compared with a net loss of US$83 million during the same period a year earlier.
The forestry company, which keeps its books in U.S. dollars, says sales during the third quarter came in at US$1.3 billion compared to US$1.43 billion a year earlier.
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CEO Sean McLaren lower housing affordability, coupled with new tariffs on Canadian softwood lumber, has created supply and demand imbalances for wood building products.
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Last month, West Fraser announced it would permanently close its lumber mill in 100 Mile House, B.C. by the end of 2025, because the mill lacks reliable access to what it calls “an adequate volume of economically viable timber.”
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The company said “challenging softwood lumber demand, higher duties and additional tariffs have compounded this situation.”
That move will affect about 165 jobs in the central B.C. community, whose current population of 2,000 serves a larger area of 20,000. Mayor Maureen Pinkney said at least another 500 indirect jobs will likely also be impacted.
West Fraser isn’t the only lumber company cutting back: a pulp mill on Vancouver Island is permanently ending operations, affecting around 350 employees.
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Owner Domtar said in a statement on Tuesday that continued poor pricing for pulp and lack of access to affordable fibre in British Columbia necessitates the closure of its pulp mill in Crofton.
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It’s a sign of struggling times in the lumber industry, insiders say.
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Kim Haakstad, president of the BC Council of Forest Industries, said in a statement that consequences of inaction for the struggling forestry sector are happening in real time.
“We have been sounding the alarm that the situation in B.C. is dire and today is further evidence that the sector needs an urgent response from our government,” Haakstad said.
“While softwood lumber duties and trade uncertainty add significant pressure, not everything can be blamed on the dispute.”
B.C. Forests Minister Ravi Parmar called the closure “gut-wrenching for workers” and said the forest sector is facing pressures from volatile markets, low pulp prices, shrinking fibre, climate-driven wildfires, conservation measures, and U.S. duties and tariffs.
“This mill in Crofton has anchored Vancouver Island’s economy for generations. This loss will hit workers, contractors, truckers, loggers and local businesses hard right before the holidays,” he said.
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