In a significant blow to British Columbia’s forestry sector, Domtar has announced the indefinite closure of its Howe Sound pulp mill and the accompanying Bayview Fibre chipping facility in Port Mellon. This decision affects approximately 400 workers and underscores the ongoing challenges facing the industry, which has been struggling under the weight of tariffs, global competition, and a dwindling supply of raw materials.
Reasons Behind the Closure
Domtar’s president, Luc Thériault, cited reduced demand and persistently low pricing for pulp as primary factors leading to this decision. In a public statement, he stressed that the closure was not a reflection on the staff’s efforts, who have been dedicated to enhancing operational performance despite the adverse market conditions. “The business decision to indefinitely idle these facilities is the result of careful consideration,” Thériault remarked, acknowledging the significant hardship the closure will impose on employees and the local community.
Since acquiring the mill in 2010, Domtar has invested over £500 million in improvements and the construction of the fibre facility. Despite these investments, Thériault noted that the company could not overcome the combined pressures of a significant decline in demand from Asia, historically low global pulp prices, and a shortage of affordable domestic fibre.
Community Impact and Government Response
The closure has sparked concerns in the Sunshine Coast community, with B.C. Forests Minister Ravi Parmar describing it as an “immensely difficult day.” He highlighted that the livelihoods of families and communities, which have relied on the forestry sector for generations, are now at risk. The provincial government plans to reach out to affected workers to provide necessary support, including mental health resources, as they navigate this challenging transition.
“The British Columbia pulp sector is experiencing a seismic shift in the global market,” Parmar stated. He further revealed that current pulp prices are approaching their lowest in a century when adjusted for inflation, highlighting the critical state of the industry.
Industry Challenges and Future Outlook
The closure of Howe Sound is not an isolated incident. Domtar previously announced the closure of its Crofton mill in December, and Canfor has also permanently closed its Northwood mill in Prince George. These actions reflect a broader trend of job losses within the forestry sector in B.C., driven by various factors, including punitive tariffs imposed by the U.S. government and shifting market dynamics.
Union representatives from Unifor have described the closure as indicative of a “deepening crisis” in the forestry sector. They warn that without immediate government intervention and support, the collapse of this vital industry could be imminent.
Why it Matters
The decision to close Domtar’s Howe Sound pulp mill is a stark reminder of the precarious state of the forestry sector in British Columbia. As communities face the brunt of these closures, the loss of jobs extends beyond immediate economic impacts; it threatens the very fabric of these communities, which have thrived on forestry for generations. Addressing the challenges facing this sector is not only crucial for the workers affected but also for the sustainability of B.C.’s economic landscape as a whole.