Canfor Corp. is closing two sawmills in northern British Columbia, eliminating about 220 jobs, but will reduce the impact by upgrading other mills at a cost of $40-million and hiring 110 workers.
The forestry company blamed cost pressures from the long-time softwood lumber trade dispute with the United States for the decision to close the Upper Fraser and Taylor sawmills this summer.
Canfor said Thursday that over the last two months it re-examined its mills and cost issues and decide that - of its 13 mills - Upper Fraser and Taylor had the highest total costs.
The Upper Fraser mill, 50 kilometres east of Prince George, suffers from high fibre and transportation costs, while the Taylor mill is older and undersized, restricting its ability to be fully cost competitive, Canfor said in a release.
The company added that it will spend $40-million to upgrade sawmills at Prince George and Fort St. John, providing 110 new jobs.
"Difficult times call for difficult decisions," said Canfor chief executive David Emerson. "We have had to rethink everything we are doing to find ways to get our costs down and improve profitability."
Mr. Emerson said the closures will make Canfor more competitive overall.
"By taking out high-cost mills and reinvesting in facilities that can accommodate third shifts and have the potential to be amongst the lowest-cost producers, we are securing jobs and economic stability for the future."