17 hours ago
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Canfor to close two South Carolina sawmills under ongoing market challenges
Canfor (TSX:CFP) announced its decision to permanently close its Estill and Darlington sawmills in South Carolina, effective August 2025
Canfor posted an operating loss of C$29 million for Q1 2025, with a net loss attributable to shareholders of C$31 million
Looking ahead to the second quarter of 2025, North American lumber markets are expected to remain volatile and uncertain
Canfor stock (TSX:CFP) opened trading at C$14.31
Canfor (TSX:CFP) announced its decision to permanently close its Estill and Darlington sawmills in South Carolina, effective August 2025. The closures come in response to prolonged weak market conditions and sustained financial losses that have rendered continued operations at the facilities unsustainable.
Approximately 290 employees will be impacted by the closures, which will also reduce Canfor's US lumber production capacity by 350 million board feet annually.
'We understand the significant impact this difficult decision will have on our employees,' Lee Goodloe, Canfor Southern Pine's president admitted in a news release. 'This outcome is in no way a reflection of the dedication and hard work of our teams. We are committed to supporting our employees through this transition, including providing severance payments and exploring opportunities for redeployment within our other operations where possible.'
The announcement follows Canfor's first-quarter 2025 financial results, reported in May, which exposed the company's ongoing struggles. Canfor posted an operating loss of C$29 million for Q1 2025, with a net loss attributable to shareholders of C$31 million, or $0.26 per share. Canfor also sustained an operating loss of C$46 million in Q4 2024.
Despite an increase in North American lumber prices during the quarter—largely driven by supply constraints amid rising global economic and trade uncertainty—Canfor's US operations continued to face significant headwinds. In contrast, the company reported improved results from its Western Canadian operations, following a rationalization strategy implemented in 2024, and another quarter of solid earnings from its European segment.
Canfor Pulp also saw modest improvement in Q1 2025, as global softwood pulp market fundamentals began to strengthen early in the quarter.
Looking ahead to the second quarter of 2025, North American lumber markets are expected to remain volatile and uncertain. Persistent affordability issues and ongoing disruptions to traditional trade routes due to tariffs are likely to dampen near-term demand.
The company has not yet disclosed details regarding severance or support for affected employees but stated it is committed to working with local officials and community partners to ease the transition. The Vancouver-based logging giant also closed two of its sawmills based in Northern British Columbia in late 2024, much to the chagrin of Fort St. John's Mayor.
Canfor's decision is an engraved sign of the broader volatility in the lumber industry, which continues to grapple with fluctuating demand, trade tensions, and shifting global economic conditions.
Canfor Corp. is an integrated forest products company involved in manufacturing high-value, low-carbon forest products. The company operates through two segments: lumber segment and pulp and paper segment. The company's solid wood products include dimension lumber, specialty lumber and engineered wood products.
Canfor stock (TSX:CFP) opened trading half a per cent lower at C$14.31 and has lost 6.65 per cent since the beginning of the year, 2.34 per cent since this time last year.
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