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The Box Lake Lumber mill is about two hours north of the US border, in southeastern BC. Not surprisingly, the major market for Box Lake’s post and rail fencing is in the US, though it is looking to grow Canadian sales.

BC’s Box Lake Lumber is taking western red cedar logs larger sawmills are not interested in and producing hand-split post and rail fencing, primarily for the US market.

By Paul MacDonald

Wood products manufactured from western red cedar, with its natural beauty—and natural preservatives—are used in a variety of value-added applications in the home, for everything from wood decking to siding to trim work.

But a British Columbia company, Box Lake Lumber Ltd, takes value-added cedar in a bit of a different direction, producing hand-split cedar post and rail fencing. And it has been successful, expanding steadily in recent years, though the company's growth has been slowed by a steep rise in the value of the Canadian dollar.

“We were fortunate when we first started out—the Canadian dollar was worth 63 cents American, so it gave us lots of room for learning,” says Dan Wiebe, mill manager of Box Lake Lumber. The major market for Box Lake’s fencing product is in the Unites States. The mill is about two hours north of the US border, in the town of Nakusp, in southeastern BC.

There was a fair bit of mill experience at Box Lake Lumber before they started turning out hand-split cedar fencing. The company was started by Dan’s dad, Ed Wiebe, in the mid-1980s and produced cedar shakes as well as cutting some decadent hemlock into dimensional lumber, before being hit by a fire in 1998. The mill was rebuilt, but they decided to get into a different market, due to a lack of cedar suitable for shake manufacturing.

“We started looking at alternative cedar products, including posts and rails, because that involved using smaller diameter logs, and there was more of that type of timber available,” explains Wiebe. They are essentially using cedar that sawmills are not interested in—it’s small, thin (often only two to four inches thick), dry and decadent, with lots of splits and cracks. Not even close to your ideal sawlog. Often, this wood was burned in the bush.

“We saw the cedar that was being disposed of in the Slocan Valley, and we saw that there was a market there in fencing—we thought maybe there was an opportunity for us to fit in there and transform what was considered waste wood into a viable product.

“We kind of knew what we were getting into, working with wood like that, but there was still a lot of learning to do when we first started out,” adds Wiebe. In recent years, Box Lake Lumber has been responding to the growing market for its fencing product in the US by becoming more efficient. “We’ve changed over our equipment and are now producing four times the rail and post products that we were producing before, with the same number of employees,” says Wiebe.

This has involved changing lines and generally making the operation more efficient, inside and out. On the mobile equipment side, they have three Cat loaders— a 950B, a 950G and a 980G—two Bobcats, an 873 and an S300, as well as several Hyster and Clark forklifts.

Since the fence rails are hand split in the mill, there is a significant human component in the manufacturing process. The work is clearly labour intensive, rather than capital intensive. “It takes time for people to learn how to run the specialized splitting equipment, and our employees have done a good job of learning and doing things better and faster, but also safely.”

Since fence rails are hand split at Box Lake Lumber, there is a significant human component in the manufacturing process. While specialized splitting equipment is utilized, the work is clearly labour intensive, rather than capital intensive.

The equipment changes they have made have been done mainly in-house, due to the special nature of the splitting equipment. Fence splitting equipment, unlike other mill equipment, can’t be purchased off the shelf. They have two millwrights who are always looking to improve mill equipment and stay on top of maintenance, a high priority area. “It’s kind of my philosophy that if you have to fix something, you should fix it a little bit better so you won’t be back there making that same fix again.”

Wiebe says they face ongoing challenges with mill bottlenecks. “It’s the case with any mill or logging operation—once you deal with one bottleneck, inevitably another one crops up.”

While Wiebe wants to make sure the operation is efficient equipment-wise, he’s also an advocate of making sure employees are in the know in terms of planning and production. “This operation is about a lot more than just running equipment— the employees have to be with you. I’ve seen mill operations that have gone high tech, and they have struggled because employees have not bought into the changes.”

A few of the current employees date from the company’s sawmill days, but interestingly, the majority of employees have never worked at a mill operation before starting at Box Lake. “Most of the employees did not know anything about split rail and had to be trained from scratch,” says Wiebe.

They’ve worked a great deal on automating the process as much as possible, but he comments it’s still a very physical and hands-on job, so they have a strong focus on safety as well.

The 30 employees at Box Lake Lumber go through about three logging truck loads of wood a day. That considered, Wiebe notes that the jobs-to-wood ratio is quite high, compared to large sawmills. “That works out to 10 jobs for every truck load a day of wood versus the one or two jobs per truck load of logs per day, if that, at a large sawmill,” he notes. Box Lake Lumber has no timber rights; they buy their cedar off Crown and private land, within about 100 kilometres of Nakusp.

“Usually, we’re able to get just enough wood to keep the mill going,” says Wiebe. “Sometimes we get a bit more, sometimes we have shortfalls, but we’ve been able to work every day. At times, we might be down to a week’s worth of wood, but more wood usually turns up. It can be a challenge, though.”

Even though Box Lake Lumber has seen sales grow, hand-split cedar fencing is truly a small, niche market. “We’ve distributed fence all over the United States,” says Wiebe. “There is a little bit of split rail used in every state, you don’t see a lot of it used in any one state.” That said, they’ve worked at developing a solid base of distributors, and are working with those distributors to develop the split rail fence market, wherever possible. They produce fencing in two- and three-rail formats; the rails are notched and the posts are drilled, so they are easy to install.

“A common use for split rail fencing is by people who have two or three acres— or even half an acre—and they want to mark their boundaries,” says Wiebe. “That’s usually two-rail fencing. Three-rail fencing is often used to keep animals in.”

Split-rail fencing is also used for a “theme” look in a subdivision or on a golf course. These would be big single orders for Box Lake Lumber, consisting of an entire truckload, or about a mile of fencing. “It looks classy, it’s low maintenance and it’s inexpensive in terms of longer term costs,” says Wiebe. Split rail outlasts almost every type of fencing that is out there, he says.

“And it’s very environmentally friendly,” he adds. “With cedar having its own preservatives, you can put a fence right next to a garden and not worry about any chemicals getting into the ground.” Regular wood, he notes, usually has large growth rings which causes it to decay quickly, requiring treating. “With cedar, the rings are very tight and with those natural preservatives, it’s going to last a long time.” The proof of that lies along many railway lines where there are cedar fencing posts still standing from more than a century ago.

Wiebe says that people also love the characteristics of split-rail cedar fencing. “Every rail curves in and around the knots, and each rail is hand-split so each piece is slightly different. Every piece has character— it’s a unique product, compared to standard dowel type fencing.”

While fencing is their focus, Box Lake Lumber works to get the most value out of every piece of wood. They produce some shingles, and shake blocks, the latter sold to other operations. “We make sure we get revenue out of every single thing, from rails and posts to extracting sawlog components and selling the bark mulch. Nothing is thrown away at the end of the day. ”

They’ve taken an innovative approach to marketing their bark mulch. It’s packaged into plastic-wrapped four feet by four feet by 4.5-foot bales, five to six cubic yards to a bale. When it’s compressed like that, it’s a lot easier to transport. They’ve shipped baled mulch to markets as far as Chicago and Colorado.

While the company has seen a good amount of growth in recent years, Wiebe expects market growth in the next while will be limited, due to the high value of the Canadian dollar. “Right now, with the Canadian dollar about even with the US dollar, it’s pretty brutal, especially considering the price of split rail fencing has not increased in the last 15 years.”

Box Lake Lumber goes through about three logging truck loads of wood a day, and wood supply can be a challenge at times. The company has no timber rights; it buys its cedar off Crown and private land, within about 100 kilometres of Nakusp.

That pricing structure has worked in its favour in one way, in that split-rail has become more competitive versus other types of fencing product, which have steadily increased in price. But it has also meant that split-rail fence producers like Box Lake have to be extremely efficient producers.

And that’s the overall approach they have been taking. “It doesn’t matter if you’re in the split-rail business or in sawmilling or logging, you have to be changing and be more efficient and do the best job,” Wiebe says. “If you’re thinking you’re going to continue to do business the way you have in the past, you won’t be around for very long.”

Faced with a high Canadian dollar, Box Lake Lumber is working to keep things going with US customers, but they are also looking at the possibility of expanding Canadian sales, which, to date, have not been a focus.