MONTREAL (From news reports) - Resolute Forest Products is continuing plans to reopen its sawmill in El Dorado, Ark., that has been closed since last summer.
The El Dorado facility is one of three mills that Resolute purchased from Conifex Timber in February. Conifex indefinitely shut down the mill Aug. 28, 2019 due to slumping lumber prices. The closure came less than two years after Conifex completed a $65 million upgrade to the mill boosting its annual production capacity to 180 million board feet of construction-grade dimensional lumber from southern yellow pine for distribution within the United States.
In Resolute's Q2 financial report, Yves Laflamme, president and CEO, noted, "The lumber market lately has been a bright spot against what were pessimistic expectations in April, driven by the strength of the repair and remodeling market and stronger housing starts, giving us the opportunity to bring back to production some of the sidelined Canadian capacity. The integration of the U.S. lumber assets is progressing well, as they have also benefitted from an above-seasonal surge in demand for decking. As lumber demand remains promising, we are pursuing our plan to bring the El Dorado facility on-line in early 2021."
Laflamme tempered his optimism in noting, "The significant slowdown in economic activity due to the (COVID-19) pandemic will continue to impact demand for paper products, and we will continue to adjust our capacity as conditions evolve. Pulp has benefitted from higher demand for higher-quality tissue despite lower printing and writing shipments, but there could be short-term pressure as those markets stabilize in the ongoing pandemic economy."
Resolute, celebrating its 200th anniversary, reported net income for the quarter ended June 30, 2020, of $6 million compared to net income of $25 million in the same period in 2019. Sales were $612 million in the quarter, a decrease of $143 million from the year-ago period. Excluding special items, the company reported a net loss of $22 million compared to net income of $11 million in the second quarter of 2019.
