Wood chip shortage shuts down Fibre machine
Wednesday, November 29, 2006 6:45 AM PST
By Evan Caldwell
Printable version
E-mail this articleA region-wide wood chip shortage has prompted Longview Fibre Co. to temporarily shut down its No. 6 paper machine at the Longview mill, a company spokesman announced Tuesday.
"Employees are being reassigned and there are no layoffs at this point," Fibre spokesman Curt Copenhagen said. Twenty-eight workers operate the machine daily, producing liner board and corrugated medium.
The shut down, which took affect Monday, will last "for an indefinite period," Copenhagen said.
"We're anticipating the curtailment will last into the first quarter of 2007," he said. "During the time it is shut down, opportunities for the operations will be reviewed and we'll evaluate any possibilities that allow us to restart it."
Wood chips -- which are cooked to extract pulp, the main ingredient in paper -- have been in short supply as sawmill production cutbacks followed the nationwide decline in house construction. Most wood chips used for paper making come from sawmill waste.
"The majority of our chips come from sawmill residuals," Copenhagen said.
Earlier this year, Fibre President and CEO R.H. "Rick" Wollenberg said the short supply of wood chips "may impact our ability to achieve some goals."
In 2007, wood chips will continue to increase in cost and be hard to find, according to Fitch Ratings, a global industry rating service.
"Next year will be a difficult year for the North American paper and forest products industry as a slowing economy and a weakening housing market contribute to lower earnings," according to a recent Fitch report.
Industrywide, the packaging and container board segment should post decreased earnings in the fourth quarter, the report said.
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