December 2006 / January 2007 - The Logging and Sawmilling Journal
MAKING THE SHIFT
Ontario logging operation William Day Construction—part of a highly diversified resource business—is overseeing some moves to at-the-tree processing, a shift that has been challenging, but it is close to achieving production targets.
By Tony Kryzanowski
Before there was Fort McMurray, Alberta, there was Sudbury, Ontario. During an expansion spurt in the 1950s — due to strong demand for nickel in the world market — local entrepreneur William Day was able to build a highly diversified business that became a legacy to pass on to his children. Among the first contracts he and his father, Oben, took on was construction work and hauling for the M J Poupore Lumber Company.
Today, Day is the president of the Day Group of Companies, a diverse assortment of firms that includes forest operations, 50 per cent ownership of Gogama Forest Products Inc (GFPI) sawmill, helicopter services, mining services, trucking, heavy hauling, construction, waste management, and safety. Five of Day’s sons are actively involved in various aspects of the operation, and in 2005, the Northern Ontario Business Awards committee named him Entrepreneur of the Year.
Listening to Day explain his philosophy, it might strike many in today’s business world as being old school, but it has definitely panned out well for Day and his family. “If you watch closely, there’ll always be a door opening up, but you have to be ready,” Day said, when interviewed by the awards committee.
“However, you have to make your mind up that you’re going to put a lot of hours in and a lot of hard work.” He added that one of his keys to success is to be honest with his customers, give them value for their money, and treat them the way he’d like to be treated.
The company’s logging operations take place primarily in the watershed area north of Sudbury. On the north side of the watershed, all water flows into the Arctic Ocean, while on the south side, it flows into the Atlantic. The forested area takes in the Pineland, Spanish, and Shining Tree forests. In some instances, the company is harvesting second growth because part of the area was logged in the early 1900s.
All told, the forestry arm of the company, operating as William Day Construction, harvests about 300,000 cubic metres annually of both coniferous and deciduous species. Poplar veneer logs are transported to the Norbord veneer mill in Cochrane, while oriented strand board (OSB) quality poplar is transported to the Grant Forest Products OSB plant in Timmins. Coniferous species are trucked to either the Domtar mill in Timmins or the GFPI sawmill in Ostrom.
From the start, William Day Construction has operated as the main logging contractor, sub-contracting out the harvesting and some of the trucking. Logging contractors throughout Canada are constantly faced with this question of whether it is more economical to use subcontractors or to own all the equipment and manage all aspects of the operation under one roof.
“The biggest advantage to subcontracting is cost,” says William Day Construction manager of Forest Operations, Darren Tegel. “When you own and operate everything, it makes your business a lot more complicated. You need a much broader infrastructure.” By that, he means that sub-contractors are responsible for their own camps, parts trailers, and parts inventory, “all of those things that are difficult to manage on a larger scale, but can be managed well on a smaller scale.”
The disadvantage is the risk that a sub-contractor will suddenly pack up and leave with minimal notice, leaving the main contractor scrambling to find a replacement. William Day Construction recently had that experience when its main client, Domtar, announced that it expected all its contractors to convert to processing at the stump within a defined time period.
Domtar anticipates significant cost savings in road building, as processed fibre will be forwarded from the stump, on top of branches, over longer distances. Also, there will be savings in keeping the branches in the cutblock, rather than the cost of piling them at roadside and burning them. No slash pile burning also delivers a public relations dividend to the company.
Some of William Day Construction’s sub-contractors have opted not to make the transition. “We had a few guys that were reluctant to go that way just because of the state of the forest industry right now because it was going to involve huge investments,” says Tegel. “These guys were already set up with their equipment.”
He says the transition has been challenging, but at present, the company is only slightly behind its production target. Essentially, William Day Construction has stayed with a threeprocess system, keeping its feller buncher contractors. However, roadside slasher operators have been asked to purchase processors and skidder owners have purchased forwarders (see sidebar story). “We’re on a learning curve,” says Tegel.
“Basically, it’s like starting to log all over again when you had it mastered before.”
William Day Construction puts in a lot of effort to log year round, except for a short lull during spring break-up, to keep its sub-contractors busy. However, given the high level of tourism activity in the area, the company may not always be working in the areas best suited for the time of year.
“Usually where we log is grounddriven, but if it’s not ground-driven, it’s tourism,” Tegel says. Some areas where there is heavy tourism activity can only be logged in the fall or winter. However, ground conditions sometimes dictate that these sites should be logged in summer. This requires quite a lot of stick handling when it comes to drafting a harvesting plan.
Also, William Day Construction may be limited in how much fibre it can harvest from a site so that a “view shed” is provided near a lake or a popular tourist area. “We have one case where we are not allowed to haul across a bridge at all, except with permission from the Ministry of Natural Resources,” says Tegel. “And when we do get permission, it’s for a set period of time. So, it has a huge impact on our operations.”
The company tries to plan as far in advance as possible whenever tourism issues impact on logging operations. Tegel anticipates that the cost of fuel will have a major impact on logging operations in future. He is already noticing a difference as sub-contractors are opting to spend more time in camp rather than commuting back and forth from their home base. Also, William Day Construction is investing a lot more time planning operations to minimize the amount of required equipment moves, once again as a cost saving measure to save on fuel.
Ontario logger opts for Tigercat/Waratah package
Sylvain Thibeault is one of the sub-contractors working for William Day Construction—in its logging operations north of Sudbury—that has made the transition from roadside delimbing and slashing to processing at the stump. It required an equipment change, and he has opted for a Tigercat 860C carrier with a Waratah HTH 622B head.
“I thought Tigercat was probably the leader in the type of carrier that is able to follow a feller buncher all the time,” says Thibeault, “and as far as the head is concerned, that head is number one in the country right now.”
He says his three main issues when looking for a carrier and processor package were life expectancy—especially on the undercarriage—productivity, and high resale value.
Thibeault says the carrier has a D6 undercarriage, though it has similarities to a D7 in that there are nine rollers and it has less curve on the end. “It gives me an extra foot on the ground for stability, and that is a big issue here when we are processing wood,” he says. “Also, because we are walking on branches, I’m looking to get 15,000 to 18,000 hours from that undercarriage.”
He notes that the carrier boom is specially designed for the Waratah processing head. In terms of horsepower, the Tigercat 860C is equipped with a Cummins QSL9 Tier III engine delivering 300 horsepower at 1,800 rpm.
While the carrier was a bit more expensive, he says taking the resale value of the unit into consideration, “you get your money’s worth.” A bonus is that Tigercat equipment is manufactured in Ontario. So he appreciated being able to support a local business. He says Tigercat has followed through with excellent service support. Waratah has also offered him excellent service support on his HTH 622B processing head.
Some of the new features on the head are a stronger body design and strengthened hanging bracket and double shear pins. It can manage more butt flare, allowing the operator to leave a lower stump when felling.
There is additional clearance for the saw unit and higher visibility through the head. It comes with a redesigned hydraulic system with all functions integrated into the main control valve, and there is new hose routing for protection and increased hose life. It also now comes with a fixed knife in the saw unit and a lockable front knife for debarking.
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Tuesday, June 12, 2007