Canfor Corp. (TSX:CFP) says it has agreed to form a 50-50 joint venture in China that will look at the potential for building a secondary manufacturing plant at a deep-water port on the northeast coast.
The Vancouver-based lumber producer is considering locating the plant about 275 kilometres southeast of Beijing at Caofeidian Port, near the city of Tangshan.
Canfor’s joint venture partner is Tangshan Caofeidian Wood Industry Co. Ltd of China. Financial terms of their partnership weren’t disclosed.
The company, one of British Columbia’s largest forest products producers, reached a tentative five-year labour contract with the United Steelworkers union.
Canfor announced last month that it would permanently close a sawmill in Quesnel, B.C., due to a lack of timber. It continues to operate more than a dozen mills in the province.
Another Vancouver-based company, West Fraser Timber (TSX:WFT), has said there continues to be strong demand in China for lumber – albeit in new markets as housing construction moves further inland.