By Ian Ross
After an arduous three-year wait, Temagami Forest Products expects to proceed with a multi-phase construction project for an eventual value-added mill utilizing surplus birch wood.
The fledgling company, started by Aurele St-Jean and Ivan Beauchamp, has received conditional approval from the Ministry of Natural Resources to build a $4.2-million sawmill operation which will provide 60 much-needed jobs for a community that has endured hard times for more than a decade.
By this spring they expect to be in a position to begin construction on the mill, with production starting up in the fall.
They plan to evolve by year three into a more diverse value-added mill.
"Our long-term objective is if we can create 200 jobs here we’ll be happy," St-Jean says. "But this will have to be done progressively."
St-Jean says they are entertaining ideas to explore such options as manufacturing cut-to-size products for various suppliers and possibly producing furniture, baseball bats or hockey sticks.
"The possibilities are there," says St-Jean. "We have the contacts, just no contracts."
The company, which incorporated three years ago for this specific project, received an added boost of a $1-million grant from Human Resources Development Canada to buy mill equipment such as two kilns with a boiler to dry wood.
On top of that, the company is receiving $570,000 from TemFund - a regional development fund - and $500,00 from FedNor to be spent on land acquisition, the buildings or wherever is needed most, says St-Jean.
"The rest is coming from us as equity for the project."
Plans are to start out with a sawmill operation to get the cash flow going, later installing kilns to maximize the wood’s value for shipment to buyers in southern Ontario, Quebec and the northeastern U.S. while they search for outside remanufacturing expertise to locate right on the property.
"There will be excellent opportunities for a partner to come in, whether it's finger-jointing or glue-lam panels or whatever," St-Jean says.
The company is also negotiating with the nearby Temagami First Nation who would enter as a 30 per cent stakeholder in the venture and have job opportunities for their people.
"It's good for Northern Ontario that we keep our resources here and maximize what we can get out of it," rather than export raw product south, says St-Jean.
"With white and red pine, we cut it green and ship it to a wholesaler in southern Ontario and Quebec, and they dry and dress it and make a fortune on it."
For Temagami Mayor Wayne Adair, waiting for the ministry's approval has been an agonizingly slow process, he says.
But it does represent the first bit of encouraging news his town has received in more than a decade since the closure of the Sherman iron ore mine, a sawmill and the loss of 40 jobs through the closure of a Ministry of Natural Resources office.
Though summer and winter tourism have remained the area’s number one industry, most employment opportunities in the service industry are seasonal.
"Basically we haven't had a workforce that could rely on a year-round, full-time job for quite a number of years," Adair says.
After initially negotiating with the MNR for 140,000 cubic metres of white birch across northeastern and south-central Ontario, the company's plans were temporarily shelved following the ministry's decision to engage in a larger bidding process with other forestry players.
After five years of conducting feasibility studies and market analysis, St-Jean and Beauchamp almost threw in the towel on the project a number of times.
With job prospects drying up in the region, it prompted a busload of Temagami women to drive down to Queen's Park to protest families were being pulled apart because husbands were forced to leave town to find work.
Eventually they formalized a wood supply commitment of 30,000 cubic metres of low-quality white birch from the Temagami Management Unit.
"It's been a trying process, and a couple of times we were ready to quit," St-Jean says.
St-Jean now expects "tremendous" spinoffs from the mill, including a $1.6-million payroll and $3.6 million in fibre purchases from private foresters who log in the management unit.
The two combined will inject more than $5 million into the community.
