Northern Sawmills' two-day auction that began Thursday will bring closure to those still clinging to hope the Thunder Bay mill would restart operations one day, said a union official.
“There are still guys out there today that were hoping for that, but obviously if they’re selling off the equipment and auctioning off bits and pieces of it, that reality is there now that there will not be a mill,” said Mike Gray, former president of Local 38-X for Northern Sawmills.
The two-day auction was held at the mill on the city’s waterfront; almost everything from the overhead wiring and rail tracks running through the plant to log rollers and the two sawmills themselves were on the auction block.
Gray called it a sad day and said at the height of operations the plant employed about 600 people.
“It’s been around probably almost 80 years that I know of,” he said. “It was a stable form of income for a lot of families in this area.”
Before closing three years ago, there were 200 employees at the Buchanan Forest Products-owned operation and while Gray said he wished the government would have given more assistance there were several factors involved in the closure, including the cost of the dollar.
“It had a dramatic effect on our costs,” Gray said, adding he hopes some of the buyers at the auction may set up shop in the Thunder Bay area.
The bulk of customers at the auction are mill owners and management, scrap metal buyers and equipment dealers, said Mike McIntosh, vice president of the industrial division of Maynards Industries – the auctioneer.
He said the receiver, PricewaterhouseCoopers, is trying to just get as much as they can out of the auction and have no set dollar figure in mind.
“The estimates are in the millions and what happens is what happens in the auction,” McIntosh said. “There’s no way of knowing until we start knocking it down.”
In his 20 years in the business, McIntosh said he’s been to countless mills from coast to coast in both Canada and the U.S. Lately, he’s seen a decrease in the number of auctions because most of the mills have been gone for a long time.
“This is a challenging industry,” he said. “It’s just the way it is and hopefully this industry comes back a little stronger in the future.”
On Tuesday and Wednesday, Maynards conducted an auction at Atikokan Forest Products and McIntosh said that sale went well.
Michael Goodman, owner of Toronto-based MHRG Inc., buys and sells scrap metal; he said he bought about 40 per cent of the material in Atikokan and was looking to purchase more at Northern Sawmills.
“I’m hoping to buy the whole place for a commodity,” he said. “So, scrap’s worth a certain amount of money, we come in, we cut it up, we send it to the steel mill.”
In addition to Atikokan Forest Products, Goodman also recently bought three sawmills in Oregon and one in British Columbia.
“The sawmill business, I think, in North America is really hurting,” he said. “That’s all I’ve actually been buying in the last two years.”
The fact that the site used to employ hundreds of people isn’t lost on Goodman.
“I came here a month ago to do my homework and there was a fellow, he worked here for 30 some years. It’s sad,” he said. “I feel terrible that there’s jobs lost.”
When he purchase sawmills, it’s usually about a three to four month job to dismantle everything and pack it up. Goodman likes to hire local people for those jobs.
While most of the equipment and materials on the Northern Sawmills site is up for grabs, there is the question of what will happen to the property.
McIntosh said the property is not part of their mandate, but he thinks it is for sale.
