In a significant development impacting the forestry sector, West Fraser Timber Co. Ltd. has announced the permanent closure of its Fraser Lake Sawmill in British Columbia. This decision, driven by challenges in accessing economically viable fibre, marks a pivotal change in the company’s operations.
Approximately 175 employees will be affected by the shutdown of the Fraser Lake Sawmill. West Fraser, acknowledging the profound impact of this closure on employees, their families, suppliers, and the local community, has pledged to mitigate the impact by offering work opportunities at other company operations. Sean McLaren, President & CEO of West Fraser, expressed the weight of this decision, noting, “We know this announcement has a significant impact on our employees, their families, our suppliers and the local community, who all rely on a healthy forest industry.”
The closure will lead to a reduction in West Fraser’s Canadian lumber capacity by around 160 million board feet. This move is part of a broader strategy to align the company’s capacity with demand and the availability of economic fibre sources.
This announcement is not an isolated event but part of a larger strategic realignment by West Fraser. In addition to the Fraser Lake closure, the company has also recently decided to indefinitely curtail operations at its Huttig, Arkansas facility, close its sawmill in Maxville, Florida, and divest three pulp assets while acquiring Spray Lake Sawmills in 2023. McLaren emphasized that these initiatives are geared towards strengthening West Fraser’s position through economic cycles.
The company anticipates recording restructuring and impairment charges of approximately $81 million in the fourth quarter of 2023. These charges are related to facility closures and curtailments due to the challenges in sourcing economic fibre in British Columbia.