Clock ticking on effort to head off Howe Sound mill closure

Port Mellon pulp mill on B.C.'s Sunshine Coast. Vancouver Sun

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The impending indefinite shutting of Domtar Corp.’s Howe Sound pulp mill on the Sunshine Coast risks touching off a domino effect of closures and job losses within the tightly integrated coastal forest industry, according to an industry expert.

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That raises the stakes for a last-minute effort to head the closure off. On Sept. 4, the provincial government appointed high-profile negotiators to work with Domtar on the matter.

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If that effort fails, industry consultant David Elstone said more than the 400 jobs at the Howe Sound mill and associated Bayview Fibre facility would be at stake, because its operations are “integrated heavily” with the sawmills that provide raw materials.

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“If Howe Sound goes down, you’ll see a severe drop in pulp log demand,” said Elstone, a strategic consultant with the firm Spar Tree Group. “You’ll see a series of sawmills go down, and you’ll basically see the start of the implosion of the coastal forest industry.”

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On Aug. 20, Domtar announced the indefinite closure of its mill due to deteriorating markets and a “decline in affordable domestic fibre,” according to CEO Luc Theriault. He added that the company will monitor markets and “evaluate future opportunities if conditions improve.”

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The risk is that if the closure lasts “a substantial period of time, it really is permanent,” Elstone said.

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If the closure goes ahead, it would be the third major pulp mill curtailed this year. Domtar announced the permanent closure of its Crofton pulp and paper mill last December, which took hold in the early months of 2026, and in July, Canfor Corp. said it would shutter its Northwood pulp mill in Prince George before the end of the year.

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However, Gibsons Mayor Silas White holds out some hope that the negotiations over Howe Sound will reach a conclusion that will be helpful to the overall industry and limit Howe Sound’s closure to a regular maintenance shutdown.

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“There definitely needs to be a shutdown,” White said. “I’m hoping it’s going to be a bit longer than it usually is, but that’s all.”

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If not, White is concerned that Gibsons, the closest town to the mill located on the west side of Howe Sound, will start to see workers pull up stakes and leave due to uncertainty around its status.

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“They really need to get going, because when I interact with my community members, I hear stories about people planning to leave,” White said. “And that’s going to be just as devastating for our community.”

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He added that the limitations on ferry transportation to the Sunshine Coast and high housing costs already make it difficult to attract new people to the community.

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Forestry Minister Ravi Parmar appointed former top civil servant Don Wright and former Canfor CEO Don Kayne as negotiators to iron out a possible resolution to keep the Howe Sound mill running.

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On Friday, Parmar said he had been in discussions with the company during the past five months, which did not lead to a conclusion.

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“They’ve shared with me some of the challenges they’re facing at the Howe Sound pulp mill, given that we are dealing with globally low pulp prices going back the last 100 years,” Parmar said.

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In an email statement in response to Postmedia questions, Domtar executive Guillaume Julien said Domtar has agreed to work with government if an invitation was made.

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Julien, vice-president of public affairs for Canada, said in a statement that Howe Sound “is a strong mill in a difficult situation” which needs “more predictable and economic access to domestic fibre,” as well as a more affordable regulatory regime.