What happens next is now the question facing Quesnel and Houston.
The West Fraser sawmill in Houston and the Canfor sawmill in Quesnel will permanently close five to eight months from now, the two companies announced Thursday. West Fraser and Canfor worked together on the decision, going so far as to swap hundreds of thousands of cubic metres of harvesting rights in order for their remaining operations to thrive. Canfor will keep its large mill in Houston running while West Fraser will maintain its large mill in Quesnel.
"In essence, what we have done with West Fraser is exchange fibre. This was not about cash, it was 100 per cent about fibre exchange to ensure the longevity" of both companies in their remaining communities, Canfor president and CEO Don Kayne told The Citizen. "Of course we looked at all kinds of different ways of prolonging [the Quesnel sawmill's life]. Some short-term degree [slowing operations] might have worked, but operating at a lower rate was not a reasonable option."
The same Quesnel mill had been closed for a short period during the American construction industry collapse until reopening in 2010 specifically to service new lumber customers in China.
Canfor and West Fraser officials were on another trade mission to China when the two companies announced the closures. So was Minister of Forests Steve Thomson.
Thomson said the two companies, being publicly traded corporations, had to keep their arrangements a tightly guarded secret until the deal was fully agreed to by both sides, and even then it had to go through a government scrutiny process to ensure against collusion and monopoly issues.
He saw the decision as an attempt to co-operate on a plan to get past the obvious challenge - the mountain pine beetle had subtracted significant amounts of trees in both if the affected communities.
"The diversified market we have built in Asia has given the industry a foundation for recovery, so its still a critical part of the opportunities going forward," said the minister. "They are companies positioning to compete in the global market, and this will be an important one for both of them, but due to the devastation of the pine beetle, this was not totally unexpected. We knew companies had to make business decisions around remaining successful into future."
Kayne said employment pain and transition uncertainty for individual families was a distinct possibility, but the closures were not due to poor markets so Canfor is in a strong position, he said, to ease those pains. The customers in China were still happy to buy Canfor wood so the company still needs millworkers.
"We have a lot of other mills to fill those gaps and we are confident our customer base in China will be looked after," he said.
That also gave good indications that the harvesting contractors weren't going to be left desperate, either.
"One thing for certain is the volumes coming out of these locations will remain strong, so each of our companies will no doubt be able to use those contractors. Our vice president Alistair Cook will be meeting with the contractors [Friday] directly to see how we can assist them move over to [West Fraser's] operations when five months is up."
Both companies pledged to have employment options available to the affected employees, but perhaps it might involve a move to another town or a long commute. They also spoke of co-operation in finding spots within each other's remaining mills for those harder to relocate.
The deeper pain might be felt by the maintenance contractors and service providers who will have half as many mills to do business with in each affected community.