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New Era In Quebec

With US shipments down 25 per cent, Quebec firms like Gerard Crete et Fils are developing new products, new markets and new ways of doing business.

By Reg Barclay
Copyright 1997. Contact publisher for permission to use.

Producing 235 million fbm annually, Gerard Crete et Fils Inc. is a 45-year-old Quebec company with a reputation for being progressive in both production and marketing. Both sides of the business are certainly coming into play these days, given the repositioning dictated on mills like this and given the constraints imposed by the US quota agreement.

Company president Luc Palmer describes the quota as a setback, not just for Gerard Crete but for all Quebec mills. Generally, the quota has reduced duty-free shipments to the US market by about 25 per cent. This means either swallowing a severe tariff penalty of up to $100 per Mfbm or finding alternative markets. "We have opted for other markets," says Palmer, "but others are looking as well, so there is competition.''

A big part of the company's strategy in the face of this can be summed up quickly: product quality, and customer satisfaction. "That will be key to success in future years, and if we are to continue to succeed, what we do today we must do better tomorrow."

Palmer says Gerard Crete plans to spend $15 million in its four mills over the next two years to increase recovery and improve quality. "Our future focus will be on developing value-added by reworking our low grades and short lengths for niche markets. We are also studying such things as finger jointing, laminating and edge-gluing. Right now, we are converting a recently acquired mill to produce 12 million fbm of hardwoods per year, which will broaden our product range."

With respect to sales, Palmer said that so far this year, the quota impact has been softened by a stronger Canadian market. This has given some breathing space while the company considers offshore market opportunities.

Market development in Japan is proceeding well with the assistance of Trek Pak, an agent on the West Coast. The company recently acquired JAS certification for the Saint Roch mill. Volume is gradually building in JAS grade, but has been slow, due to a softer Japanese market.

Neil Pelletier, vice-president of sales, says the firm has been fortunate in that the Mideast market has provided an alternative to the US. The UK market has been important for Gerard Crete, but at this point the return from current market prices is too far below North American markets.

Pelletier describes the company's marketing strategy these days as hands-on and customer-oriented. "We used to sell through wholesalers and had little if any contact with the customer. Now we sell direct as much as possible and regularly visit the customer to help them find the right size and quality for their needs. At the same time we encourage customers to visit our mills to see what we are doing."

Gerard Crete's four mills are located along the St. Maurice River, which flows from the north into the St. Laurence, about 100 km west of Quebec City. We recently visited three of them in company with Pelletier, who is based in Quebec City.

The first mill visited, the Proulxville Division at Saint Severin (also the company's head office), is the largest. It is a 16' random-length mill with an annual production of 90 million fbm (220,000 m3). It is designed to handle a range of log diameters from small to large. After a log sort by diameter and length, and after debarking, logs enter one of three lines: a canter twin with bull for small logs; for medium-size logs, a canter twin with bull and two edgers; for large logs, there is a carriage and band saw. There are two trim saw lines, one for narrows and one for wides, followed by an automatic sorting line.

A state-of-the-art drying complex was built in 1993 with a modern planing mill. There are three Salton kilns, steam heated by boilers, with a computerized sawdust feed system, which maximizes boiler temperature by optimizing the mix of air and sawdust.

The mill at St. Roch, about 30 km north of Proulxville, is also a 16' random- length mill, but smaller, producing annually 60 million fbm (140,000 m3). Following the debarker, this mill has one line-a chip-n-saw in tandem with a bull. After trimming, there is a manual sort. St. Roch also has a modern drying complex, built in 1992, with two Salton dry kilns using steam and heat, supplied by a boiler system similar to that at Proulxville, and a modern planer mill. The importance of quality, at both Proulxville and St. Roch, is underlined by a moisture detector.

As part of its quality push, a new wax process will be installed behind the planer at the St. Roch mill for overseas shipments. It will spray each piece on four sides and both ends with wax to prevent moisture penetration and will eliminate the need for anti-stain treatment. For markets such as Japan, the lumber will arrive cleaner and brighter with moisture content preserved, even if the paper wrap becomes torn, as sometimes happens from frequent handling in transit.

Product presentation is an important part of company marketing policy. Great care is taken to ensure lumber packages have square ends and straight sides and the well-designed paper wrapping is neatly applied with the ends fastened securely. Stickers are attached on the bottom of both ends of each package when strapping, to facilitate handling during transit.

The mill at La Tuque is 100 km further north of St. Roch. This mill, built and equipped by Denis Comact, is a good example of a highly automated 10' stud mill, built to efficiently handle small- diameter logs. Production is 40 million fbm (94,000 m3) per year. Logs are sorted by length at the mill infeed into one of 12 bins. The purpose is to run the mill on one length at a time. There are two Nicholson debarkers supplied by Maritonex for logs processed by the mill. There is also a rotating drum debarker for short, small-diameter logs which will be chipped.

The mill has one processing line, consisting of a canter twin in tandem with a curve-sawing bull with a linear positioning table and optimizer. There is also an optimizer edger for boards from the side cut at the canter twin.

The trim saw I-Tech optimizer by Multimeg scans each piece every 6" top and bottom and makes the trim decision to produce the length and grade with best mill return. Following trimming, each piece is directed automatically into one of 28 bins. As each bin is filled, it is emptied onto a chain which takes the lumber to an automatic stacker, where stickers are inserted between each layer, ready for the dry kiln.

Only nine people are required to operate the mill each shift, processing 10,000 to 12,000 logs per nine-hour shift.

La Tuque does not have kilns or a planer. Two-inch dimension is trucked to Saint Roch or Proulxville for drying and planing. Short lengths and boards are sent to a custom drying and planing operation outside the company.

Logs in the woods are sorted by species and the separation is continued through mill processing to facilitate drying. Tree-length logs are trucked to La Tuque and St. Roch where both stationary and mobile slasher saws cut to mill length. Average hauling distance is 175 miles, as logging progressively moves north. Log lengths 12' to 16' after slashing are trucked to Proulxville, which does not accept tree-length logs.

Fibre for the three softwood mills is 45 per cent black spruce, 45 per cent jack pine, and 10 per cent balsam fir and other species. These species make excellent dimension lumber - sound with small tight knots. Trees are small in diameter and sometimes not straight, so special sawmilling techniques are required for an economic recovery of quality lumber.

Of concern are rising fibre costs. Palmer points out that stumpage rates increased 50 per cent on April 1st, and have tripled over five years. He says a big problem is that stumpage does not take into consideration the impact of the US quota on mill returns.

Quota or not, Palmer is confident about the company's future. "Gerard Crete is well positioned to meet future challenges."

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