Builders optimistic in the US

Builders optimistic in the US

The pace of housing construction stalled in June, with total housing starts falling 9.3 per cent for the month to a seasonally adjusted annual pace of 893,000.

Counterfeit tools on the rise

Counterfeit tools on the rise

Low quality, high danger as more counterfeit chainsaws are available.

Leadership in a changing climate

Leadership in a changing climate

Professionals are required to use the best available science in making our decisions, and so we recognize that climate change is occurring.

Climate change requires action in BC

Climate change requires action in BC

"Climate change is occurring and it has fundamental impacts on British Columbia's communities and ecosystems."

Stella-Jones uses customized loaders

Stella-Jones uses customized loaders

When it came to choosing a replacement for their aging log-handling equipment, the two site managers, working 500 miles apart, came to the same conclusion.

video
Some environmentalists exaggerate...
Quebec’s forests are not threatened, according to a new documentary and an Economic Note from the Montreal Economic Institute.Video location: QuebecRecording date: August 2014
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FPAC on innovation in forestry...
Catherine Cobden explains what is meant by innovation in forestry
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WorksafeBC cautions workers falling trees...
WorksafeBC cautions workers falling trees
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Edgewood optimized...
Edgewood optimized

Harvesting

Judge denies First Nations' request

Aug. 26, 2014 - A New Brunswick judge has denied the request of First Nation chiefs for an injunction to temporarily block the provincial government's new forestry plan. The new plan gives the industry more access to Crown wood and has spurred new investments by J.D. Irving and other forestry companies but has proven to be controvercial among academics and former provicial government employees.  According to the CBC, "Justice Judy Clendening said she had to consider three tests in reaching her decision - whether there is a serious matter to be tried, risk of irreparable harm and balance of convenience." Although she found that the government failed to consult First Nations about the forestry plan, she wasn't convinced of the risk of irreparable harm. For more information, click here.

Doosan has new Tier 4 crawlers

Aug. 26, 2014 - Two new Tier 4-compliant Doosan excavators are now available in the United States and Canada — the DX300LC-5 and DX350LC-5 — featuring improvements in fuel efficiency, productivity and durability. Replacing the DX300LC-3 and DX350LC-3 models respectively, the new Doosan crawler excavators have new engine modifications and aftertreatment technologies to meet Tier 4 emissions regulations. Tier 4 engine configurationDoosan 271-horsepower DX300LC-5 and 318-horsepower DX350LC-5 excavators are powered by Scania diesel engines that have been configured with a high-pressure common-rail (HPCR) fuel delivery system as well as cooled exhaust gas recirculation (CEGR). Doosan also added a mass airflow (MAF) sensor and exhaust brake to the engine to help meet Tier 4 emission standards. The mass airflow sensor allows the electronic control unit (ECU) to improve the management of airflow provided by the variable geometry turbocharger (VGT), and to optimize fuel delivery to the combustion chamber based on air intake volume and rpm. The VGT is utilized to enhance boost pressure throughout a wide rpm range of the engine, resulting in improved fuel efficiency at lower rpms. This also generates higher torque levels and faster engine response even at low rpm, and improves machine performance in the Standard and Economy power modes while saving fuel. The exhaust brake helps to maintain consistent engine temperatures at lower engine speeds to improve operating efficiency. Consistent engine temperatures reduce harmful emission levels in the exhaust when the engine is running at lower rpms. Under normal operation, with high rpms, the exhaust brake is inactive. Aftertreatment technologiesNew Tier 4 compliant Doosan excavators combine selective catalyst reduction (SCR) with a diesel oxidation catalyst (DOC) to reduce engine emission levels. Diesel exhaust fluid (DEF) is used with SCR technology and stored in a DEF tank near the front-left corner (opposite of the operator station) of Doosan crawler excavators. The DOC transforms particulate matter (PM) emissions into harmless water and carbon dioxide. DEF is injected into the exhaust system to transform the nitrogen oxides (NOx) produced during combustion into water and nitrogen. Productivity boostAvailable for the DX350LC-5, D-ECOPOWER optimizes hydraulic system output with engine horsepower, improving machine efficiency, productivity and fuel consumption, as well as refining machine control and enhancing operator comfort. A pressure controlled pump, closed centre main control valve and various sensors in the excavator electronically detect and control the precise amount of hydraulic oil required to perform a task. Four power modesSimilar to previous Doosan excavators, operators can choose from four power modes for more control to better balance fuel consumption and machine power to the working conditions. Power modes include the following:• Power+ mode: delivers the fastest workgroup speeds for loading trucks, top digging performance and extra power for digging in hard ground• Power mode: provides exceptional power and performance for tough digging conditions and truck loading tasks• Standard power mode: balances the excavator's fuel consumption in everyday digging, grading and lifting tasks• Economy mode: reduces fuel consumption for low-demand applications, slows down machine movement for conditions that require extra precision To further match Doosan excavators to the application at hand, operators can choose from four work modes — digging, breaker, shear and lifting — to maximize efficiency and fuel economy in specific applications. Operators can configure the work mode by adjusting a dial switch on the right-hand console. A work mode icon displays on the monitor after the operator presses the mode button. Fuel savingsNew Tier 4 compliant Doosan excavators feature improved fuel efficiency to help owners reduce operating costs. For example, a Tier 4-compliant DX350LC-5 excavator has a 10 per cent fuel savings from the equivalent Tier 3 model. For further fuel savings, auto shutdown helps owners save fuel during non-working conditions. When enabled, the feature will shut down the excavator's engine after a preset idle time. For example, the operator can configure the idle time from 3 to 60 minutes. For operators in California, auto shutdown helps meet the state's regulations of idling for only five minutes for off-highway machines. Display enhancementsAn improved 7-inch LCD display panel allows operators to continue monitoring the excavator parameters while viewing the rearview and/or side view camera image. Critical machine data appears next to the camera view. With an optional side camera, a split screen allows both camera displays to be viewed at once. New additions to the monitor include the DEF gauge and fuel efficiency. DurabilityIn an effort to minimize downtime, Doosan excavators have standard features that ensure their durability, even when operating in harsh conditions. These features include a robust and reliable track tensioning system. Improvements made during the launch of the dash-3 models, such as larger bushings in track rollers and thicker sprocket teeth, are evident in the dash-5 models. Also carried over from dash-3 models are added reinforcement plates and increased plate thickness to the excavators' boom and arm. Doosan telematicsDoosan DX300LC-5 and DX350LC-5 crawler excavators come with a standard three-year subscription to telematics, commonly known as "machine intelligence." Telematics allows equipment owners to monitor machine location, hours, fuel usage, engine idle versus work time, error codes, and engine and hydraulic temperatures. Owners and fleet managers can monitor their machines remotely after they log in to a website account. Equipment dealers can also help customers through telematics by responding to machine warning messages, providing the proper parts and service after reviewing the website and diagnosing an issue with a machine, and then sending a field service vehicle to make the repairs.

Sawmilling

Miramichi may add pellet plant

Aug. 26, 2014 - New Brunswick based company, Northern Energy Solutions (NES), has secured a New Brunswick crown lands wood allocation, moving it closer to the opening of a new wood pellet plant in Miramichi. "We are very grateful for the 378 000m3 wood allocation from the Government of New Brunswick," said Ross Creelmen, Owner of NES. "With a secure wood allocation, we can now move forward with the next developmental phase of this project." The construction of this $50 million plant is contingent on an investment grade feasibility study which requires a secured long-term wood allocation and a detailed analysis of the plant site. NES is evaluating two sites in the region, the former UMP pulp and paper mill site in Newcastle and the former UMP ground wood mill in Nelson. The decision on location of the plant is expected by the end of October 2014. With a planned production of 200 000 tonnes of wood pellets a year the NES mill would be one of the largest producers of wood pellets in eastern Canada. NES wood pellets would be destined for industrial users in Europe to fuel co-fire coal plants and coal plants converted to burn pellets. The new plant will use low value, low grade wood from the Miramichi region that is currently being underutilized, like some of the unused pulpwood, biomass, bark and mill residues like sawdust, and wood shavings. The NES plant will be complementary to other forestry producers in the region by purchasing those products. "We all know that since the closure of the large pulp and paper producers, Miramichi has lacked a buyer for pulp, biomass and residual wood products like shavings and sawdust," said Creelman. The new plant will also be looking to procure another 100 000 m3 of wood fibre from private wood lot owners and First Nations Groups. The NES plant is expected to open by late 2016 to early 2017. Once operational it will employ up to 100 people in the Miramichi region. Northern Energy Solutions is being led by industry pioneer Ross Creelman. He has more than 20 years experience in wood pellet production and opened one of Canada's first wood pellet plants in 1992.

2015 Kenora sawmill start-up

Aug. 13, 2014 - After seeing a successful re-start of the Ear Falls Sawmill last week, Unifor has now reached a long-term contract with Kenora Forests Products (KFP) to re-start sawmill operations by the beginning of 2015. The new deal will also facilitate millions of dollars in capital investment for modernizing the mill and installing an additional saw line for expanded lumber production. Stephen Boon, Unifor National Representative, said, "a large amount of time and energy went into negotiating this deal and now the only remaining hurdle to resuming sawmill operations in Kenora is final Ministry of Natural Resources (MNR) approval of the mill's wood supply. Kenora supported two sawmills and a large pulp and paper mill prior to 2005, so we are confident the MNR will have little trouble ensuring Kenora Forest Products secures the necessary wood supply crucial for restoring operations at one of the city's three closed mills. Boon said, "Kenora has been particularly hard hit by massive forestry job losses over the last decade and this new mill re-start deal promises to restore hundreds of direct and indirect jobs to the community while also providing key monetary and language improvements for over 100 unionized mill employees. Trades pay will reach almost $36/hour with production pay averaging close to $27/hour in the final year of this new agreement." Boon concluded, "a successful sawmill re-start is not only good news for the company, our members and the city of Kenora, but also for members of the area's Aboriginal community. In this new deal, Unifor and Kenora Forest Products committed to ensuring the area's Aboriginal groups also share the benefits of a re-opened sawmill by establishing a 30% employment target for Aboriginal participation in the mill's workforce." KEY TERMS OF DEAL- Deal starts in Fall of 2014 and runs until December 31, 2020Wage Increases – 18% over 6 yearsSeptember 19, 2015 - 3%September 19, 2016 - 3%September 19, 2017 - 3%September 19, 2018 - 3%September 19, 2019 - 3%September 19, 2020 - 3% - $3.65/hour immediate raise to $30/hour for certified trades- $840 per worker increase in employer annual pension contributions- one additional floating holiday- $.15 increase in shift differential up to $.75/hour during term- $400 annual tool allowance for trades- improved language related to benefits, sick pay, seniority, recall, bereavement, bumping and contracting out- commitment to promote 30% employment target for Aboriginal members in sawmill operations For more information, contact Stephen Boon, Unifor National Representative-Dryden, at (807) 323-0093.

Industry news

Lumber prices up over summer

Aug. 27, 2014, Toronto - Scotiabank's Commodity Price Index edged down by 0.3% month-over-month (m/m) in July, but the Forest Products Index advanced by 2.4% month-over-month in July and remains 5.0% higher than a year earlier. Western Spruce-Pine-Fir 2x4 lumber prices have rallied back seasonally from US$324 per mfbm in June to US$351 in July and a lucrative US$367 in late August. U.S. housing starts climbed to 1.093 million units annualized in July, centred in multi-family dwellings. U.S. homebuilder confidence has increased to a 7-month high, given a strengthening U.S. job market (employment gains have averaged a healthy 244,000 in the past six months) and cheaper mortgage costs. NBSK pulp prices stayed near-record highs of US$1,030 per tonne, but inched down to US$1,020-1,030 in August, with a 2-day increase to 27 days-of-supply in world bleached softwood kraft inventories and a surge in hardwood stocks to 46 days. Read the full Scotiabank Commodity Price Index online at: http://www.scotiabank.com/ca/en/0,,3112,00.html.

Housing starts rebound in July

Aug. 26, 2014 - After a disappointing June report, U.S. housing starts rebounded with a 15.7% increase in July. The June dip was caused by a fall in single-family construction in the U.S. South and was eliminated as single-family construction rose 8.3% with increases in three of the four U.S. regions, according to the National Association of Home Builders (NAHB). The rebound mirrored rising home builder confidence. The August NAHB/Wells Fargo Housing Index rose two more points to 55, approaching the 2014 high of 56 from January. Expectations for the next six months increased by two points to 65. According to the NAHB, a key question going forward is the degree to which the mix of buyers may change. The share of first-time home buyers remains weak and has resulted in a rising trend in new single-family home size. If more first-time buyers enter the market in the future, it will hold back the median new single-family home size. Consumer debt positions continue to improve, says the NAHB, which should be a net positive for housing demand.  Meanwhile, the count of unfilled construction sector jobs increased in June to 127,000, the fourth highest tally since the end of the recession. The number of job openings has grown significantly since 2011 as the housing industry has recovered. Builders will find it challenging to meet demands if they're unable to find enough workers.  For more information, go to http://www.nahb.org.

Port Hawkesbury hosts CWF

Aug. 26, 2014 - The Canadian Woodlands Forum will hold its 2014 fall meeting and education session in collaboration with FPInnovations and the Canadian Wood Fibre Centre in Baddeck, Cape Breton, NS on October 8 and 9, 2014. The conference will be hosted by Port Hawkesbury Paper. For more information on the meeting and schedule of events, go to www.cwfcpf.org.

Wood industry attends social

Aug. 26, 2014, Burlington - Close to 30 professionals from the wood industry met in southern Ontario for an evening of networking and the launch of a new social network for the forest industry and those who rely on it. CEOs, operators, designers and consultants from Toronto, Mississauga and the communities in the region met through an event set up by FPInnovations. This new social network, WISnet, will meet monthly to secure these new connections and allow for new ones to be made. The next event will be on September 17. For more information, go to http://WISnet.ca.

Wood Panels

Ainsworth election results

Aug. 14, 2014 - Ainsworth Lumber Co. Ltd. announced the results from its 2014 annual general meeting of shareholders held on August 12, 2014. All of the eight nominees listed in the Corporation's Management Proxy Circular dated July 3, 2014 proposed by management for election to the board of directors at the Meeting were elected to the board. The directors will remain in office until the next annual meeting of shareholders or until their successors are elected or appointed. The results of the vote on the election of the directors are as follows:                                 Votes in Favour                           Votes WithheldName                         #               %                           #                %---------------------------------------------------------------------------- Robert Chadwick   180,106,039   94.74                  9,997,575      5.26Paul Gagne           190,054,174   99.97                      49,440       0.03Peter Gordon        189,052,368   99.45                  1,051,246      0.55Paul Houston        190,053,174   99.97                       50,440      0.03John Lacey           189,990,074   99.94                     113,540      0.06Jim Lake               189,146,915   99.50                     956,699      0.50Gordon Lancaster 190,053,174   99.97                       50,440      0.03Pierre McNeil        189,052,515   99.45                  1,051,099      0.55

Ainsworth remains optimistic

Aug. 13, 2014, Vancouver – Ainsworth Lumber announced higher shipment volumes and a reduction in unit costs in its Q2 financial results. Ainsworth President and Chief Executive Officer, Jim Lake said, "North American OSB market conditions were relatively weak as the spring building season did not materialize as anticipated. North American benchmark OSB prices were stable relative to the prior quarter, although they were nearly 40% or U.S.$130/msf lower than the second quarter of 2013. Despite the slower pace of housing growth in the near-term, we are optimistic about the longer-term recovery and continued absorption of industry supply. The recent slower market environment in North America does highlight the strategic importance of our traditional export market in Japan as well as the progress we are making in markets such as China for new applications of OSB." Financial Results Sales of $117.4 million in the second quarter of 2014 were $10.1 million lower than sales of $127.5 million for the same period in 2013. The decrease in sales was mainly due to a 24% decrease in realized pricing. The impact of the U.S. benchmark declines on our realized pricing was moderated by the effect of a weaker Canadian dollar relative to the second quarter of 2013 and more stable export pricing in Japan, combined with a 21% increase in sales volumes due to additional production from High Level. In the first half of 2014, sales were $225.2 million compared to $269.3 million in the same period of 2013. The $44.1 million decrease was related to a 25% decrease in realized pricing, partially offset by an 11% increase in sales volumes and the same factors noted above. The increase in volume from High Level was partially offset by transportation issues that limited shipments during the first quarter of 2014. Adjusted EBITDA was $13.1 million in the second quarter of 2014 compared to $50.7 million in the same period of 2013, largely as a result of lower realized pricing. Notwithstanding the significant reduction in gross profit, net income from continuing operations in the second quarter of 2014 was $9.5 million higher than the prior year. This increase was largely due to fluctuations in non-cash accounting gains and losses and income tax expense combined with decreased selling and administration expense. Adjusted EBITDA for the first half of 2014 was $23.3 million compared to $113.2 million in 2013, due mainly to lower realized pricing. Net loss from continuing operations in the first six months of 2014 was $2.2 million, compared to net income of $39.3 million for the same period in 2013, representing a decrease of $41.5 million. The decrease reflected lower gross profit, partially offset by fluctuations in non-cash accounting gains and losses and income tax expense. Margins Adjusted EBITDA margin on sales for the second quarter of 2014 was 11.2% compared to 39.8% in the same period of 2013 (10.3% in the first half of 2014 compared to 42.0% in the same period of 2013). The decreases were largely related to lower realized pricing in North America. Benchmark OSB pricing remained stable during the second quarter of 2014, although down significantly from the same periods last year, with North Central and Western Canadian pricing for 7/16" OSB averaging U.S.$219 and U.S. $206 per msf, respectively, representing a decrease of 37% versus the second quarter of 2013. Sequentially, the North Central benchmark price remained flat, while the Western Canadian benchmark price decreased 6% versus the prior quarter. Liquidity At June 30, 2014, Ainsworth's available liquidity, consisting of cash and cash equivalents, was $103.2 million, a reduction of $34.2 million since December 31, 2013 resulting from our seasonal log inventory build, semi-annual interest payment and capital expenditures, combined with the timing of accounts receivable and accounts payable. Outlook While the pace of improvement has been slower than previously expected, we remain optimistic about the medium to long-term outlook as U.S. housing starts recover to more historical levels. Additionally, we continue to experience growth and stable pricing in our traditional export market of Japan. We are also continuing to advance our opportunities in export markets such as China for new applications of OSB. The restart of our High Level mill will allow us to meet the growing requirements of our existing North American and export customers as well as service new market segments over the longer term.

Remanufacturing

Moulding bull market rally

Aug. 13, 2014 - A wave of demand is coming and so are higher prices, concludes Peter Butzelaar the Vice President of International Wood Markets Group in his U.S. Clear Pine Lumber and Moulding Market Outlook: 2014-2018.  After enduring four years of declining demand of epic proportions, underlying demand is beginning to re-emerge. "Although not the strong start the industry was anticipating for 2014, the results in the second half of this year should build on the demand gains made in 2013," comments co-author Russell Taylor. WOOD MARKETS is projecting U.S. housing starts to surpass 1 million starts in 2014 followed by an additional 125,000 starts in 2015. As the labour market and income levels improves, housing demand will see accelerating growth as will residential repair and remodelling (R&R) - the two main drivers of moulding demand. However, due to mill closures, supply chain consolidation, and limited supplies of domestic clear pine fiber, traditional moulding supply in North America is forecast to struggle to keep up with demand. For more information on the report, go to www.woodmarkets.com.

Stella-Jones sales up 23%

Aug. 11, 2014, Montreal - Stella-Jones announced financial results for its second quarter ended June 30, 2014. Sales reached $344.8 million, up 22.7% from $280.9 million in the same period last year. "Solid industry demand for Stella-Jones' core products and the contribution from recent acquisitions led to a strong sales growth in the second quarter of 2014. As railway tie and utility pole replacement programs continue to gain momentum, our proven ability to respond to product and service requirements enables us to further penetrate our markets. As anticipated, higher costs for untreated railway ties had a negative effect on profitability. However, strong sales growth and our continued focus on optimizing our plant network resulted in a year-over-year increase in net income," said Brian McManus, President and Chief Executive Officer. SECOND QUARTER RESULTS Sales reached $344.8 million, up 22.7% from $280.9 million in the same period last year. The operating assets acquired from The Pacific Wood Preserving Companies ("PWP") on November 15, 2013 and from Boatright Railroad Products, Inc. ("Boatright") on May 22, 2014 contributed sales of $12.0 million and $3.7 million, respectively. The conversion effect from fluctuations in the value of the Canadian dollar, Stella-Jones' reporting currency, versus the U.S. dollar, increased the value of U.S.-dollar denominated sales by about $18.0 million when compared with the previous year. Excluding these factors, sales increased approximately $30.2 million, or 10.8%. Railway tie sales amounted to $141.5 million, up 18.1% from $119.8 million a year earlier. Excluding sales from the PWP and Boatright assets, as well as the conversion effect, railway tie sales rose approximately $7.7 million, or 6.4%, reflecting solid market demand from replacement programs. Sales of utility poles reached $121.6 million, up from $95.1 million last year. Excluding sales from the PWP assets and the conversion effect, utility pole sales increased $14.0 million, or 14.7%, as a result of larger customer orders for distribution and transmission poles stemming from increased demand from replacement programs and certain special projects. Sales in the residential lumber category totalled $49.4 million, versus $41.3 million a year ago, mainly reflecting solid demand in Western Canada and the United States. Industrial product sales reached $25.1 million, up from $17.0 million last year due to the contribution of the PWP and Boatright assets as well as increased sales of rail-related products. Finally, non-pole-quality log sales amounted to $7.2 million, versus $7.7 million a year ago, as a result of the timing of timber harvesting. Operating income stood at $41.6 million, or 12.1% of sales, versus $41.0 million, or 14.6% of sales, last year. The decrease as a percentage of sales is mainly due to higher year-over-year costs for untreated railway ties, partially offset by greater efficiencies throughout the company's plant network. Results for the second quarter of 2014 also include a $1.6 million write-off of certain property, plant and equipment in the United States and acquisition-related costs of $616,000 in connection with the Boatright transaction. Net income for the second quarter of 2014 increased 9.1% to $28.8 million or $0.42 per share, fully diluted, compared with $26.4 million or $0.38 per share, fully diluted, in the second quarter of 2013. SIX-MONTH RESULTSFor the six-month period ended June 30, 2014, sales amounted to $602.3 million, versus $503.5 million for the same period in 2013. Acquisitions accounted for total sales of $28.9 million, while the conversion effect from fluctuations in the value of the Canadian dollar versus the U.S. dollar had a positive year-over-year impact of $34.3 million on the value of U.S. dollar denominated sales. Excluding these factors, sales increased approximately $35.7 million, or 7.1%. Operating income was $76.4 million, or 12.7% of sales, up from $70.6 million, or 14.0% of sales, last year. Net income reached $51.3 million, or $0.74 per share, fully diluted, compared with $45.2 million, or $0.65 per share, fully diluted, a year ago. FINANCIAL POSITIONAs at June 30, 2014, the company's long-term debt, including the current portion, stood at $456.8 million compared with $407.0 million three months earlier. The variation essentially reflects working capital requirements and the acquisition of Boatright. To partially finance this acquisition, the company's committed revolving credit facility was increased from $400.0 million to $450.0 million. As at June 30, 2014, an amount of $391.7 million had been drawn against this facility. As a result of this higher debt, Stella-Jones' total debt to total capitalization ratio was 0.43:1 as at June 30, 2014, versus 0.40:1 three months earlier. OUTLOOK"We expect healthy demand for our core products for the remainder of the year driven by a better economy and sound fundamentals in our main sectors of activity. With regards to higher cost for untreated railway ties, margins will be impacted in the short term, until we are able to adjust selling prices as per provisions in most of Stella-Jones' multi-year contracts. Further profitability improvements will also be driven by sustained initiatives to optimize efficiency across our expanded North American network following recent acquisitions," concluded Mr. McManus.

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