Tolko employees at its Armstrong and Soda Creek (Williams Lake) divisions will be off worker longer than hoped.
The company announced Wednesday it is extending downtime at both locations for an additional two weeks due to poor market conditions and uneconomic log costs.
“As the recent rash of curtailments and closure announcements indicates, current market and cost conditions are making it difficult to operate in B.C.,” said Tolko vice-president, Solid Wood, Troy Connolly. “And, with significant increases to stumpage rates set to take effect in July of this year, we expect conditions to remain challenging.”
Connolly knows this is a difficult time for employees at these operations; however, he says the company wanted to let people know as soon as possible.
“These decisions are difficult. As a family-owned and operated business, we’re proud of our communities and our employees. While we prefer to remain operational, industry conditions are challenging right now, and we want our people and their families to have time to prepare.”
An additional 16 million board feet (mbf) of capacity will be removed from Tolko’s lumber production as a result of today’s announcement.
Pino Pucci, vice-president, Tolko marketing and sales, assured customers that although this is a tough time for the industry, Tolko’s marketing and sales team “will continue to support our customers and do our best to minimize any impacts as a result of these changes.”
Tolko recently annonced a reduction to one shift at its Kelowna division, and will permanently close its operation in Quesnel. There are no plans at this time to permanently close the Armstrong division.
“We’ve made a number of capital investments there of late to prepare the mill to operate successfully for the long run,” said Tolko communications advisor Janice Lockyer. “These decisions (downtime) are related to market conditions and log costs only. As the recent rash of curtailment announcements indicates, current conditions are impacting the entire industry.”