Skip to content

Tembec turns down Rosko’s mill plans (7/03)

If Tembec’s Kenogami mill remains closed, Rosko Forestry Operations is ready to develop its own milling and planing facility in Kirkland Lake. “We’ve put in a proposal to the (Ontario) Ministry of Natural Resources,” says company president Joe Rosko.

If Tembec’s Kenogami mill remains closed, Rosko Forestry Operations is ready to develop its own milling and planing facility in Kirkland Lake.

“We’ve put in a proposal to the (Ontario) Ministry of Natural Resources,” says company president Joe Rosko.

“We’re waiting to hear a direction from the Ministry.

“We haven’t set a deadline for this. A deadline says there is a point in time where you’re willing to stop and, right now, there is not,” Rosko says.

Joe Rosko is part of a Kirkland Lake taskforce aimed at keeping wood harvested in the Kirkland Lake area from going elsewhere to be milled.

Last fall, Tembec announced the latest in a round of layoffs at its Kenogami mill. The company cut a total of 61 jobs from the mill, deciding to keep only a small crew of 19 in charge of drying and planing. The company attributes the shutdown to a weak softwood lumber market combined with anti-dumping and countervailing duties imposed last year by the United States Commerce Department.

“The Kirkland Lake mill has been down about half a year and we won’t start it up until prices improve substantially...you can’t run a mill like that and lose $400,000 to $500,000 a month,” says Tembec executive vice-president Jim Lopez.

A strengthening Canadian dollar, the imposition of 27 per cent anti-dumping and countervailing duties and a glut of available lumber on the market have created a “poisonous atmosphere” for lumber producers and the companies that supply them, he says, adding it shows no signs of improving soon.

“We were hoping to see some seasonal improvements in May because construction season is just starting up in Canada so this is when you see a big pull in the market and the prices come up,” he says. “It happens every year, but it didn’t happen this year; in fact, we had the opposite happen.”

“What we’ve told the ministry is that, rather than allow the wood to move elsewhere, we would be willing to build a facility,” says Rosko.

Rosko says the company was hoping to purchase the Kenogami mill. Lopez says that the company has reviewed the offer and has delivered a “firm no” on the proposal.

“For now, our offer still stands with Tembec or with the ministry,” Rosko says. “If Tembec comes up with a suitable business plan for the wood supply that shows they’re willing to use it, then everything becomes null and void.”

Rosko Forestry Operations, a major supplier of wood for the Kenogami mill, has been in operation for the over 25 years. The company is a full stump-to-mill operation that supplied approximately half of Tembec’s wood at the Kenogami mill.

He says that his mill plan calls for the production primarily of square four-by-four, six-by-six and eight-by-eight lumber for a variety of construction uses in the Canadian market.

Rosko projects that the company would earn approximately $15 million per year from the proposed venture.