Millar Western Forest Products Ltd. will indefinitely curtail operations at its Quesnel River Pulp mill in British Columbia, Canada.

The decision is the latest in a series of closures and curtailments affecting British Columbia's forestry sector in recent years. It follows an August announcement that the mill would temporarily shut down from September 4 until at least November 1, amid weak demand, low prices, reduced orders and tariffs affecting exports to China.

In a letter sent to employees on November 9, executive chair and CEO Karl Meyers said the company had reviewed all alternatives before concluding that an indefinite curtailment was the only viable option under current conditions.

The company cited continuing market challenges and uncertainty surrounding the availability of economically viable fiber supplies: “The duration of the curtailment remains unknown and will depend on market conditions and the availability of economic fiber supply,” Meyers said in the letter.

Millar Western will complete an orderly shutdown of the remaining operations over the coming weeks, while maintaining the facility in a condition that could allow a potential restart in the future.

The company will also continue operating the mill's effluent treatment system for 12 months, or until an acceptable alternative arrangement is reached, in accordance with existing contractual obligations.

Impact on employees and the community

The decision will result in the termination of employment for all workers affected by the curtailment. Millar Western said it would provide severance compensation, continuation of certain benefits and access to employee and family assistance resources. It will also consider displaced employees for vacancies at its other operations.

Approximately 90 employees were affected by the initial temporary shutdown announced in August. The company has not provided a revised figure for the total number of positions affected by the latest decision.

Quesnel Mayor Coralee Oakes said the city was deeply disappointed, warning that the consequences would extend beyond mill employees to contractors, local businesses and families.

According to Oakes, heavy industry represents approximately 53% of the city's tax base. She also estimated that the municipality could lose between C$100,000 and C$150,000 annually in revenue linked to the mill's electricity consumption through BC Hydro.

Premier-designate Lorne Doerkson described the indefinite curtailment as a “hard blow” for employees and the wider community. He said the company had left the door open to a possible restart, while highlighting the need for mills to obtain fiber and permits more quickly to remain operational.

Federal loan announced in July

The indefinite curtailment comes just over three months after the Canadian government announced a C$100 million loan to Millar Western through its Large Enterprise Tariff Loan (LETL) facility.

Announced on July 27, the financing was intended to provide liquidity to help the company manage trade-related uncertainty, strengthen its near-term operations and rebuild its log inventory.

At the time, the federal government said Millar Western employed more than 420 full-time workers and supported approximately 300 contractors across its operations. It also disclosed that 93% of the company's sales went to Asian markets, primarily China.

The loan was provided to Millar Western at company level and was not specifically allocated to the Quesnel facility.

Quesnel River Pulp

Located in Quesnel, British Columbia, Quesnel River Pulp produces bleached chemi-thermomechanical pulp (BCTMP), with an annual production capacity of 375,000 ADMT of softwood pulp.

The mill was previously owned by West Fraser Timber Co., which completed its sale to an affiliate of Atlas Holdings on April 22, 2024. Millar Western Forest Products operates the facility, alongside its pulp mills in Whitecourt and Slave Lake, Alberta. The sale included a long-term fiber supply agreement for the Quesnel facility.

Millar Western has a combined annual BCTMP production capacity of approximately one million tonnes across its three mills. The indefinite curtailment of Quesnel River Pulp therefore removes a substantial part of the company's production capacity from operation, although a potential restart has not been ruled out.