Canfor Corp. (TSX:CFP) plans to close three B.C. sawmills indefinitely over the next two months in a move that will affect approximately 570 employees.
The three Interior mills, Vavenby, Radium and Rustad, have a combined annual production capacity of 560 million board feet, which represents 11% of the Vancouver-based softwood lumber giant's total.
Following closure of the mills, Canfor, which has curtailed production at other mills in recent months, said it will be running at about 50% of total rated lumber capacity.
"These decisions are never easy, but are taken in the face of a market downturn that's unprecedented in terms of both duration and intensity," Canfor president and CEO Jim Shepard announced late Thursday night. "Canfor must continue to re-structure its production capabilities to match the demands of the market and ensure the needs of key customers continue to be met."
The company is B.C.'s biggest softwood lumber producer. It also makes oriented strand board (OSB), remanufactured lumber products and specialized wood products.
The pulp and paper industry is likewise reeling from its own market freefall.
Catalyst Paper Corp. (TSX:CTL) is responding by implementing deeper staff cuts.
The Richmond-based company said 100 staff positions will be affected. Permanent reductions will be made at its Richmond and Nanaimo offices and approximately 55 salaried staff at its Elk Falls mill and Crofton pulp mill will be laid off indefinitely.
Production at both mills was curtailed indefinitely at the end of February as almost 40% of capacity has been idled.
The "unprecedented layoffs" within the salaried workforce reflect the severity of recent demand declines and the likelihood that curtailed production will not restart in the short term, the company said.
Richard Garneau, Catalyst's president and CEO, said the steps would continue to bring costs down as the company strives to put in place a "lean manufacturing structure" he said is necessary for what's expected to be a smaller future paper market.