So, what happens when the world’s largest producer of oriented strand board says they are expanding one of their mills, and re-opening another that was closed due to low market demand?
Probably, if you are a manager at head office of Tolko, you take notice. That’s what happens.
But first things first. The world’s biggest producer of OSB, the same product that used to be made in the High Prairie plant, is Norbord, a Canadian company headquartered in Toronto.
Last year, Norbord announced a big expansion of their Scotland OSB mill in Europe. Norbord has 17 plants and mills around the world, including OSB mills in Grande Prairie, High Level, and 100 Mile House in B.C.
Says Norbord, “North American benchmark OSB prices improved significantly in the first quarter of 2017 as new home construction activity and OSB demand continue to improve. [Prices] are demonstrating the tightness in the largest US housing market as the spring building season commenced.
“Norbord’s operating North American OSB mills produced at 94 per cent of stated capacity [excluding two curtailed mills in Alabama and Chambord, P.Q.], up from 92 per cent in the same quarter last year.”
Is that good? Well, capacity has been running between 95 per cent and 100 per cent in Europe. Because of that, Norbord is spending $135 million, starting last year and ending next year, expanding capacity in the Scotland plant.
What does that mean for the Tolko High Prairie plant?
Given the spin-up time to get the running, and the business realities of telling people what you are doing so they don’t get the idea of doing the same thing, or telling people what you are doing and they end up copying you because they like the idea, who really knows?
Forestry is no different than running a corner store. Since Tolko management, not being as big a company as Norbord, is probably a follower than a leader, The Page thinks it’s going to take an announcement of one or two of the Norbord “curtailed” plants spinning up to get something out of Tolko.
At the same time, getting the High Prairie plant as close as possible to a start up without spending huge amounts of money would be logical.
Now the big question is, what does Norbord do to keep one step ahead of the whole game, too? The smarter they are, the longer they can keep plants closed, the tighter the market gets, and the higher the prices they can demand for product.
Gee, business can be as much fun as office politics!
* * * * * * *
Yes it’s a long weekend coming up. Weather forecasts are a mixed bag, as usual.
Keep in mind there is often snow on the coming May long weekend. And often rain. Often frost. And once in awhile, some quite decent weather. That’s what our forecasts seem to be predicting.
No matter what, if there isn’t any gardening or farming, cottage country fills up with diehard campers determined to kick off summer.
Watch the highways and byways fill up with all kinds of camping gear, trailers, boats, motorhomes, all heading to a holiday.
* * * * * * *
Isn’t it amazing how a couple days of real rain brings an explosion of green everywhere? Just like that, kabam!
Now we need lawnmowers and dandelion spray. Wow!
* * * * * * *
This little bit of rain the past weekend, along with what seems like the final spring snow melts in our local bush country, have good water flows into local lakes.
Readers might recall last year our entire province was praying for rain. Everybody was complaining about low water levels, dust, and not being able to use marinas right across the province.
Here is a quote from last year’s South Peace News: “One poster on a popular discussion board says everybody just has to suck it up. Next year snow will probably be back, and then it will rain all summer. And then the water levels will be super high. Then there will be flooding.”
Well, we sure got the rain later in the year, didn’t we?
* * * * * * *
Have a great week, and a super great weekend!