Precut Solutions
A reborn Terrace reman facility hopes to be part of the local forest industry’s revival, one job at a time.
By: Bill Tice
Rick McDaniel has a big job ahead of him. The energetic general manager of Terrace Precut Mills Ltd. has the challenge of turning a collection of unused sawmill equipment into a viable wood products remanufacturing facility. “To date, it has not been easy and we are nowhere close to being where we need to be, but with lots of perseverance, things are coming along,” explains McDaniel when describing the progress on the project. “People here in Terrace want to make this work and we have been able to run a few shifts, including our first shift with a skeleton crew in mid-October of last year, but we know we have a long way to go and a lot of hard work ahead of us.”
The mill equipment had been sitting idle for over three years when McDaniel took on the job of revitalizing the operation at the end of August 2005. The reman facility had been one of the victims of the financial problems that plagued the Skeena Cellulose sawmill, which is right across the street from Terrace Precut and had been the company’s biggest customer. The future brightened for the northwestern British Columbia facility and the town of Terrace when a group of investors, spearheaded by local businessman Moe Takhar, purchased the former Skeena softwood mill from the receivers in 2005 and pulled it out of bankruptcy, renaming it the Terrace Lumber Company.
Terrace Precut was originally built in the mid 1980’s by Takhar, who is now president of the Terrace Lumber Company. McDaniel stresses that Takhar has stayed out of the revitalization of the reman plant and won’t be involved in the running of it. “Moe has a hands off approach to Terrace Precut,” explains McDaniel. “He has hired me to make this operation viable again and to run it as he is busy making Terrace Lumber profitable, and because the sawmill is our biggest customer, he wants to ensure there is no perceived conflict of interest.”
McDaniel and Takhar go back a long way as one of McDaniel’s first jobs was driving a logging truck for Takhar. With the exception of a three year stint between 2000 and 2003, McDaniel left the forest industry for almost 20 years and developed a business background from being involved with his family’s distribution business and working for Coca Cola. “Moe came to me last year and said ‘why don’t you run the reman facility for me?’ and here I am,” explains McDaniel. “I have a lot of confidence in Moe as he knows the wood products business very well. Before I took this on, my wife and I talked itover and we felt that this was a very viable opportunity. It was a risk, but we felt it was a risk worth taking.”
Shipping news
Like many other people in Terrace and BC’s northwest, McDaniel is counting on the new container port being built a couple of hours away in Prince Rupert as a catalyst to increase business. The first phase of the $120 million shipping facility is expected to come on-line in late 2006 and will open a new trade route between China and North America. In addition to the new shipping route shaving a day off the travel time between BC and Asia, the new port is expected to open new markets for value-added producers in northern BC and Alberta, such as Terrace Precut.
“We are really excited about the opportunities that the new port will provide,” says McDaniel. “We have already had business groups from Terrace travel to Asia to make initial contacts and to open up new markets for local value added products. Containerization will also allow for the cost effective shipments of smaller orders, and because many containers now come here full and go back to Asia empty, the shipping rates are very favourable for us when we are shipping in that direction.”
McDaniel foresees a “full spectrum of products” being produced at Terrace Precut for the Asian market. “We will be able to produce furniture parts, furniture kits, wood products for building and finishing homes, picnic tables and a host of other products,” he says. “As the economy in China shifts and the middle class expands, they are becoming the newest wave of consumers. They are looking at magazines and seeking products available in North America such as garden furniture, gazebos and other lifestyle products. That opens up a lot of new markets for us and the other value-added producers in this region.”
In addition to the consumer type products McDaniel describes, he is also looking at remanufactured lumber for the export market.
“Terrace Lumber will be our biggest supplier and customer,” he explains. “Terrace Precut was originally built as a reman plant for Repap Lumber, which was the predecessor to Skeena Cellulose and Terrace Lumber at the neighbouring site. At that time, the remanufacturing facility was running lath and dunnage products as well as doing some reman work for the sawmill, and that will continue to be a large part of our business. Historically, there has been a good market for the standard reman lumber products here due to the quality demanded by Asian customers, particularly in Japan.”
Options open
McDaniel says they have numerous options when remanufacturing standard lumber products but describes what could be done with a 50mm x 205mm piece that might be flawed on one side. “I could take that piece and split it into two finished pieces that are 47mm x 90mm, or I could run three 47mm x 60mm pieces or a number of other configurations.”
In addition to remanufacturing, the Terrace Precut plant will treat lumber for the larger mill and will do some kiln drying. “Terrace Lumber has the capability of treating lumber for the export market to prevent mould and fungus, but we also have a chemical dip facility at our site, so we will be able to take any excess treatment volume that they can’t handle,” says McDaniel. “We also have two dry kilns so we can dry any green product coming into our facility, and we can handle drying for Terrace Lumber or any other mills in the area if they are overloaded.”
Production at Terrace Precut starts when the incoming lumber is taken off the delivery trucks and either put into storage or straight onto the infeed where they use either a Tri State Machine ripsaw or a Gunderson Bros. 5096 bandsaw to split it vertically and cut an upgrade out of it. “We might get a number one piece out of one side and then take the fall down and sort it to see if there is something else we can do with it to increase the value,” says McDaniel.
The prime piece that has been cut out of the board will then be replaned to the specified dimension before being directed to a green chain where a manual grader will determine what the board can be used for and place it in the appropriate sort. The fall down will be stored and used as required for smaller pieces such as the furniture parts McDaniel plans on producing. The mill is also a certified heat treat facility and heat-treated dunnage producer. Other remanufacturing equipment on site includes two Akhurst N-A chopsaws, an Omnitrade edger, a Newman Machine Co. four-head planer profiler, three trim saws built into the green chain, a precision end trimmer and a CKS-500 chipper.
The two kilns at Terrace Precut include a Custom Dry Kiln model that can handle up to 48,000 bdft at one time and a brand new kiln, also from Custom, that was purchased just before the reman facility was closed, but was never used. The newer kiln has a capacity of about 60,000 bdft. Most of the work for the kilns will come from Terrace Lumber and McDaniel says the kiln cycle will be around six days. Following the drying cycle, the KD lumber will be repackaged and shipped directly from Terrace Precut. Both kilns are capable of drying to extremely tight tolerances, so McDaniel is anticipating taking on products that require special attention during the drying process, such as clear boards and higher value wood.
Initially, McDaniel will be running one shift with a maximum crew of 11, adding that the crew will jump to 14 if the kilns are running at full capacity. He has been contacting past employees that were laid off when the plant last shutdown to offer them the first chance at the new positions. He also adds that the local community is pleased that the reman plant is starting up again.
“The local community is ecstatic about the revival of this plant and the Terrace Lumber mill,” he says. “In addition to the mill jobs, the reopening of these facilities is creating a number of spin-off jobs as well. The unemployment rate in Terrace is only at about 9%, but that number is deceiving because many of the people that live here and were employed by the local forest industry, still make their home here but have to go elsewhere to work. Personally, I have taken work elsewhere but by accepting this position with Terrace Precut, I have the opportunity to work in my own town. More importantly, I have the chance to be part of the rebuilding of the forest industry in Terrace. That is something I am proud of.”
