Province�s sawmill industry continues to experience significant growth

The most recent sawmill lumber statistics (1998-1999) indicate that lumber production is continuing to grow at record levels in Newfoundland and Labrador.

According to Forest Resources and Agrifoods Minister, Kevin Aylward, the sawmill industry in Newfoundland and Labrador has experienced a significant and consistent level of growth throughout the 1990s. "In 1991-1992, production in the province was under 40 million FBM (foot board measure or board feet)," said Minister Aylward. "The level of production has increased throughout the 1990s, reaching 118 million FBM for 1998-1999. It is anticipated this figure will increase again this year with over 125 million FBM expected to be produced at sawmills throughout the province."

The minister attributes this increase in production in large part to the consolidation of smaller sawmills within the industry. "Combining operations has resulted in greater efficiency which has strengthened the overall industry in the province," said Minister Aylward. "In addition, new technology has provided many mills with the capability to produce fibre from residue such as slabs and edgings. These are fibre sources that were traditionally wasted."

Minister Aylward also indicated these larger mills now have specialized debarking capabilities, enabling them to meet the pulpchip quality standard of the pulp and paper industry. He said, "Today, sawmills are increasing their productivity through greater efficiency while providing an important alternative fibre source for the province�s paper mills."

Growth has also occurred in the area of hardwood production. The level of hardwood production doubled in 1998-1999 from that of the previous year, with over 4 million FBM being produced. "This is due in part to an increase in new value-added initiatives undertaken by the industry," said Minister Aylward. "Forestry officials have been actively working with sawmillers and the Newfoundland and Labrador Lumber Producer�s Association to pursue new opportunities for the industry, particularly for export markets in the Eastern United States. By working together, both government and industry have been successful in identifying market demands and the need for product diversity while at the same time increasing efficiency with respect to resource availability."

The sawmill industry has a particular importance to rural communities, said Minister Aylward. In that regard, government is currently exploring the establishment of sawmill operations along coastal Labrador. Minister Aylward said, "Discussions have taken place with industry and communities in Labrador. The Department of Forest Resources and Agrifoods hopes to have agreements finalized in the near future regarding the establishment of new sawmill operations in this part of the province."

Although a recent reduction in market prices have presented a challenge to certain sawmill operations in the province, Minister Aylward feels the industry today can withstand these current market conditions. "The move toward the establishment of integrated sawmills over the past few years has improved the efficiency and viability of most sawmill operations. Accordingly, the overall industry in the province now has the capability to withstand these periods when market conditions are less than favourable."

Despite these recent market trends, in 1998-1999, the value of shipment for lumber produced at sawmills in Newfoundland and Labrador still totalled approximately $47 million. This number is expected to reach $50 million for 1999-2000.

Media contact: Craig Renouf, (709) 637-2923, fax: (709) 637-2403.

2000 11 09 4:20 p.m.