Harmac prepares to start second production line
Robert Barron, Daily News
August 19, 2009
Harmac pulp mill operators in Nanaimo plan to start a second production
line by the middle of September.
President Levi Sampson said Tuesday that about 10 maintenance workers have already been hired to prepare the second line for production and an additional 35 will be hired once the machinery is prepared for service. The total number of employees working at the mill once the second line goes into production will be 265, including all of the remaining workers who have been waiting to return since the mill temporarily shut down last year after its previous owners, Pope & Talbot, went bankrupt.
There were more than 500 workers at the mill when it shut down, but many have moved on to other jobs and locations or have retired from the industry.
"We're pretty excited to be able to bring back all those workers who wanted to come to the mill, plus some new hires," Sampson said. "It will be good for those people who have been on the outside looking in since we re-opened the mill last year."
Nanaimo Forest Products, a four-way partnership that includes Harmac workers and three private partners, bought the 60-year-old mill last summer for $13.2 million.
As part of the business deal, the workers each invested $25,000 in the mill and Sampson said the 45 employees who will return to work will also be expected to invest the same amount, in installments, which will be put toward the mill's working capital.
He said the price of the northern bleached softwood kraft pulp Harmac produces is expected to rise in September to about $650 a tonne in China, which buys almost half of the 20,000 tonnes of pulp the mill produces each month.
The price sunk to about $500 per tonne in February, so increasing production is now feasible.
Sampson dismissed the projections of some industry analysts that markets in China for Canadian pulp will soon begin to tumble. He said with so many Canadian pulp mills shut down, Harmac officials expect the mill will be kept busy filling the demand.
Forest Minister Pat Bell hailed the decision to add a second line at the worker-owned mill as "great news" that should provide "huge lessons" to an industry that continues to struggle.
Bell said he has always been a "big supporter" of Harmac's unique operating model, which has allowed it to shave production costs and keep the mill internationally competitive in lean times.
"I'm not aware of any other pulp mills in B.C. expanding their operations at this time so the proof is in the pudding and I've been encouraging other unions and companies across the province to learn from Harmac," Bell said.