END OF AN ERA IN MIRAMICHI
Newcastle Lumber Co. Inc., a local family-owned sawmill that has been operating in Miramichi since 1894, has gone into receivership, company president Dan Anderson announced in a news release. This marks a sad end to Miramichi’s once celebrated mill era.
“Understandably, this is a very difficult time for Newcastle Lumber, its employees, suppliers, and customers,” Anderson said. “In the face of very difficult economic times and other closures in the region, the mill fought very hard to stay in operation — unfortunately it was unable to secure the necessary funding in order to modernize its operations and stay competitive.” Over 100 workers will be affected by the shutdown, including woods contractors and mill workers at the main mill in Newcastle and the dressing facility in Boiestown.
A loan guarantee from the provincial government which expired last year wasn’t renewed. Nobody has said why the company cannot get another small loan guarantee from the province. The Graham government recently announced $50 million in guarantees to Atcon Group.
Anderson said as part of their plan to modernize he approached the government with an interest in the former UPM mill in Blackville and a Crown allocation from there, but the province told him the allocation wasn’t available. “What irks me the most is …. I mean you can look around at all kinds of areas and see where the province has picked to modernize other mills and companies.” The plan to modernize would put about 100 people back to work, which was the same as before the company’s two mills shut down, but it all depends on how the government acts this summer, he said. “The thing is to get back to work first and then to modernize. That’s the key to the future.” Anderson said the mills used about 60,000 cubic metres of wood and a modernized mill would need about 200,000 cubic metres from a combination of Crown and private wood.
When asked if a saw mill can be a profitable business, Anderson said Newcastle Lumber does a lot of value added products and would be profitable if they could modernize. “If we had modernized two years ago as we had hoped we would still be running today.” Anderson said the company didn’t ask for any government funding, just a wood allocation and a loan guarantee so they could borrow money to modernize and when asked why the government didn’t come forward with help he didn’t know.
“I wish I could give you an answer to that.”
When asked about criticism the government isn’t helping Newcastle Lumber, Miramichi Centre MLA Foran repeated they did provide them with a loan guarantee in the past. “It wasn’t about an allocation in the last couple of years. It was about survival in the market that was out there.” Foran said the province was also working on the Weyerhaeuser OSB mill sale over the last year, which involved a Crown allocation and they did provide Newcastle Lumber with a temporary allocation. “It’s unfair to say we wouldn’t give it to them. Weyerhaeuser was back on the market and we did everything we could to promote that and provide an allocation to them.”
Jean Guy Comeau of the Northumberland County Forest Products Marketing Board said his organization has worked with Newcastle Lumber since they formed and they have had a great relationship. “Working with these people you just can’t compare. It’s been unbelievable.” When the marketing board was building their first office they didn’t have the money to pay for the lumber they needed right away so Newcastle Lumber lent it to them until they could pay them, Comeau said.”I’m very disappointed as a Miramichier and a New Brunswicker that we seem to fail to help the people that help the area and the province the most. That is something that I will never understand.” Comeau said the region’s wood is leaving the area and he doesn’t know why the province is in a hurry to use it because cut trees are still useable for about three to five years. “One of the things that’s most surprising is they’re treating wood like it’s ice cream.”
Anderson said the company is going through the receivership process and has to have their plan in place by July 27. “We have a plan. It’s just up to the government to respond. That’s the sad part about this.” Although he would not say the size of a loan guarantee they need, Anderson said a lot of it depends on how much wood the government will allocate to them. “The more you get allocated the more you can raise in funds.”
Miramichi-Bay du Vin MLA Bill Fraser said he didn’t know the specifics of the file because Newcastle Lumber is not in his riding, but he did say the government will look at any plans that could create employment in the Miramichi. “If it’s a plan that’s going to work and is sustainable in the long term and it’s going to create employment in the Miramichi then we have an obligation to support it.” The local MLAs have supported Newcastle Lumber in the past, but they have to present a plan to government and it has to show they are a viable business, he said. “It has to be good for the Miramichi area and it has to be good for New Brunswick.”
Newcastle Business District general manager, Natalie Bradford, said the mill has been in business for more than 100 years. “I’m sure that’s more than long enough to justify any assistance they may require.” Bradford said the government has supported companies owned by groups from outside the Miramichi, but she thinks the community support is there for Newcastle Lumber. “Just to say locally owned and operated should be enough.”
Anderson said he approached the government with a plan to upgrade that included purchasing the now idle sawmill in Blackville. But to do that, he would need a Crown allocation, in addition to buying wood from private woodlot owners. However, Anderson was told the allocation wasn’t available and the mill was eventually sold to Umoe, who has decided not to reopen it.
Instead, wood from that allocation is being used for a mill in Bathurst, which, according to Miramichi Centre MLA John Foran is “OK”. “They have a right to that wood. OK. They have a saw mill in Bathurst.” Foran said about Umoe using wood from the Blackville mill allocation to feed the mill in Bathurst.
The Bathurst mill was operating and had its own Crown Wood allocation when the Province removed the Crown Wood Allocation from the Blackville mill and gave it to the Bathurst mill also.
By refusing to allocate wood to the Newcastle mill and removing the wood allocation from the Blackville mill and transferring it to the Bathurst mill, the Graham government is ensuring that the mill in Newcastle, the mill in Boiestown, and the mill in Blackville remain closed with the resulting loss of jobs to the residents in those communities.
Is this what Graham was referring to when he talked about “Our new sustainable management approach for Crown forests”?
Northumberland County has four elected representatives in the Provincial Legislature. These four MLA’s are Liberal members of Shawn Graham’s caucus.
Rick Brewer – Southwest Miramichi – Represents Blackville & Boiestown
Boiestown (506) 369-2011 Blackville (506)369-2011
John Foran – Miramichi Centre – Represents Newcastle
Newcastle (506) 624-2131
Bill Fraser – Miramichi-Bay du Vin
Carmel Robichaud – Miramichi Bay-Neguac
Posted: July 2nd, 2009 under Forestry Practices.
Comments
Comment from Jim Forrest
Time August 16, 2009 at 2:58 pm
I am amazed to see government bureacracy, or perhaps even worse, politics, permit the destruction of a 100 year old, locally owned, family business.
Comment from Anynomous
Time August 13, 2009 at 10:42 am
This is an absolute outrage. The govenment is not looking at the best interest of the people in Miramichi at all!!!!