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Norbord drops North American OSB mill capacity 25% amid COVID-19 conditions


March 26, 2020
By Maria Church
Maria Church

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Beginning March 30, Norbord will be reducing production capacity at its North American OSB operations by 25 per cent in response to the demand impact of the COVID-19 pandemic.

The company says it plans to reduce shifts and run some of its North American mills on alternating schedules to match production with an anticipated reduction in OSB demand.

“These are extraordinary times and difficult decisions, but they reflect the uncertainties facing businesses around the globe,” Norbord president and CEO Peter Wijnbergen said in a news release. “Of utmost importance, our first priority remains the health and safety of our employees, and in response we have been implementing a number of measures across our operations to mitigate potential exposure to COVID-19. Further, we believe that reducing operating schedules across our mills gives us the best flexibility to adapt to the ever-changing demand landscape while still meeting our customers’ needs, reducing hardship on our employees and ensuring we are prepared for a return to growth when markets normalize.”

The company says its new flexible operating schedules will allow it to adjust to the fluctuating OSB demand situation, and warned that factors outside its control, such as government-imposed restrictions, could result in additional operating adjustments or mill closures.

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Thus far Norbord’s European business continues as usual, but is prepared to take similar action, the company says.

The company will also be deferring non-critical capital projects and further reducing its 2020 capital expenditures budget by 25 per cent, from US $100 million to US $75 million, to preserve cash and balance sheet flexibility.