Tembec to shutter pulp mills in August

paperloop.com
SAN FRANCISCO, July 19, 2001 (paperloop.com) - Tembec Inc., the second-largest capacity pulp producer in North America, plans to shut down its mills for the month of August due to weak market conditions, said a company executive. Earlier, Tembec had announced it would curtail pulp production by about 100,000 tonnes in the third quarter.
"All of it (is market-related downtime), most is in August," said the executive, who indicated the firm would ?shut down cold' most of its facilities systemwide for the month. "My customers are taking downtime and I in turn told them we will match their downtime. Our October 1 inventory will be the same as in '99 when the market was tight."
Last week, an industry source noted that Tembec would take a month of downtime at its 227,000 tonne/yr northern bleached softwood kraft (NBSK) mill in Skookumchuck, B.C. With the closure in August, that mill will lose about 20,119 tonnes while Tembec's other NBSK mill, in Smooth Rock Falls, Ont., will trim about 16,926 tonnes based on capacity of 191,000 tonnes/yr. Tembec's NBSK downtime will total 37,405 tonnes, representing more than a third of its 3Q downtime.
Tembec's third-quarter curtailments equal the firm's combined downtime on the year, with 55,000 tonnes trimmed from supplies in 2Q. But the executive said this quarter there were no plans to perform maintenance.
"We have no traction in prices because the inventories (industrywide) are too high. Shutting down now is not going to cost us in sales. We have stock. Given that paper business returns to normal I will be able to run my business normal."