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Sale of Mill

Started by sawguy21, October 13, 2021, 01:32:38 PM

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sawguy21

West Fraser Timber expanding U.S. operations with US0M purchase of Texas sawmill | iNFOnews | Thompson-Okanagan's News Source
This is interesting to say the least. The mill is new and turning a profit yet hasn't reached full capacity. Is it not growing fast enough to suit the shareholders? Is West Frasers offer too sweet to pass up? They are investing heavily in American mill operations, I have to wonder where the money is coming from. The Canadian industry is certainly not robust.
old age and treachery will always overcome youth and enthusiasm

WDH

West Fraser is a big producer in Georgia with 4 large sawmills.  So is Interfor with 7.  Together they account for well over one billion board feet of softwood production.  A significant portion of Western Canadian lumber production has moved to the Southern US.  
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barbender

West Fraser just bought out the Norbord OSB facility in Solway, MN about a year ago. They are on the move it seems.
Too many irons in the fire

K-Guy


No softwood tariffs if you are located in the US.
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WDH

Georgia has more forestland than any other state.  
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nativewolf

Hmm, GA has lots of forest but I don't think production could touch OR.  Having been to both places the DF plantations are just..amazing.  

Just found out that Alaska has the most forests.  Looks like GA ranks #3 in softwood production behind OR and Washington.  Far higher than VA.  Can't believe the places the foresters tried to grow hard yellow pine in MD, PA, WV, and VA.  I know have a project that will convert 300 acres of the worst pine plantations you've ever seen back into hardwoods.  Oh joy.
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moodnacreek

Back in the eighties the small sawmills in the U.S. dropped dead. All the blame was on Canada. That was then, this is now.

WDH

My reference was to forested acres, not production.  

Alaska is actually first and Georgia 2nd, but when it comes to commercial forest production, Alaska is not much of a player. 
Woodmizer LT40HDD35, John Deere 2155, Kubota M5-111, Kubota L2501, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

WDH

Woodmizer LT40HDD35, John Deere 2155, Kubota M5-111, Kubota L2501, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

SawyerTed

The sale of mills is an interesting thing to watch.  The reasons they sell are varied.  The one where I'm working now sold because of the fire that put the head rig, gang, resaw and edger out of commission.  The owner decided to retire rather than rebuild.  That's another reason mills sell.  The owner/operator is ready to retire and there isn't a family member interested enough to continue the operation.  The retiree uses the proceeds to feather his or her retirement nest.  I've seen this a couple of times recently with other businesses as well. 

Then there are the acquisitions by a larger company of a growing sawmill which the original post seems to indicate.  If an operation is growing, in a growth region and is relatively new, buying is quicker that building.  For commercial sawmill machinery the lead time for new is 14 or more months depending upon the manufacturer and the machinery.  Six months is a pretty reasonable lead time now days.  Some of it is getting better, we've had some manufacturers shorten their lead time to delivery estimates in the last couple of weeks.  A purchase of an existing mill with employees in place is a far quicker way to get a mill.  

A group of mills in our region recently sold because the owner apparently was taking profits out of the mills to fund his farming habit.  The bank foreclosed on the mills.  It is a mess now because various machinery and rolling stock was owned by others so nobody knows who owns what right now.  We were interested in some machinery at one of the mills and found out that what we were interested in was in limbo.  The bank doesn't know who owns it, the new owner of the mill site doesn't know if they own it or not.  Meanwhile the machinery sits unused.

I've looked at two closed mills recently in search of some machinery for our rebuild.  Those two were built and owned by the same entity.  They purchased the least expensive equipment they could, ran it several years until it was worn out, closed up and were selling out by auction.  They have built or plan to rebuild elsewhere.  With interest rates so low, it has been easier to close up, sell out and build a new mill than rebuild an existing mill.  It seems some of these "pop up" mills follow where rapid residential and commercial growth is occurring.  Once the development begins to taper off to a steady rate and land clearing is tapering off, the mills shut the doors.  I've noticed this in NC, SC and VA.  
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charles mann

The mill the article is referencing was bought out by a candian company (abitibi) back in the late 90s, early 2000s, i cant remember exactly. But i was a millwright helper for je merrit, building a paper machine. Once operational, the machine made a few runs, then abitibi closed the entire mill down. 

It hurt the economy of lufkin, which was a blessing for me, forcing me to join the us active duty military and getting out of that town. But for many others, esp the loggers, it forced a large number to haul load further away to nacogdoches or corrigan, till it was no longer profitable, shutting down the loggers from the lufkin area. 

The mill has sat idle for 20 yrs, but hopefully this helps build that town's economy back up, offering employment other than fast food or box store jobs. Every time i go back hm to lufkin, i cant imagine how/why the town has lasted this long. 
Temple, Tx
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sawguy21

That is interesting history, certainly not what the article indicated.
old age and treachery will always overcome youth and enthusiasm

farmfromkansas

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Don P

Quote from: SawyerTed on October 15, 2021, 11:12:47 AMA group of mills in our region recently sold because the owner apparently was taking profits out of the mills to fund his farming habit.  The bank foreclosed on the mills.  It is a mess now because various machinery and rolling stock was owned by others so nobody knows who owns what right now.  We were interested in some machinery at one of the mills and found out that what we were interested in was in limbo.  The bank doesn't know who owns it, the new owner of the mill site doesn't know if they own it or not.  Meanwhile the machinery sits unused.


Boy does that sound familiar. 

SawyerTed

Not far from either of us.
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