Canfor Corp. Remains Committed to Construction of New US Sawmill

SEATTLE (Scrap Monster):  Vancouver, British Columbia-based integrated forest products company, Canfor Corp., has announced its decision to go ahead with its investment plan to build a new sawmill facility in Washington.

The company had earlier announced that it will spend $120 million towards construction of a new 275 million board feet sawmill facility adjacent to its existing facility in the US state. However, market participants had expressed concerns over the company’s commitment to build a new facility under current market conditions, especially at a time when uncertainties around high lumber duties and a possible deal between the US and Canada continue to hurt market sentiments.

In a statement released yesterday, Canfor Corp. announced that it sticks on to its investment decision. However, the commencement of construction works of the plant is likely to get pushed beyond second quarter of this year. The company had earlier decided to commence start construction in Q2 2018. However, one of the contactors has announced that previous commitment is likely to delay construction of the Canfor plant. The company is in talks with the contractor to find a solution at the earliest, the company press release said.

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The company noted that encouraging results posted in 2017, coupled with predictions of improved market conditions in 2018 have prompted them to go ahead with the investment. The US housing starts had recovered sharply in Q4 last year. The Canadian housing starts too edged higher by 16% during the quarter. The mill will turn out to become one of US’s key operating facilities, mainly due to its strategic location and use of latest technologies.

Canfor Corp had announced robust operating results for Q4 2017 and for the full year 2017. The company had reported record sales of $4.66 billion in 2017. The net income had almost tripled over the year before to $363.4 million.