Logging, Manufacturing...
and More

B.C.’s Jemi Fibre Corporation does just about a bit of everything in the forest industry, from logging through to added value manufacturing—and it’s looking to do more, says company president, Mike Jenks.

By Paul MacDonald

Jemi Fibre Corporation does just about a bit of everything in the forest industry, says company president Mike Jenks—and it’s looking to do more.

The company, based in Cranbrook, in B.C.’s East Kootenays region, does logging and added value wood products manufacturing in B.C. and Saskatchewan, and, most recently, has set up its own chipping operation.

“We started in harvesting, trucking and road construction, got involved in manufacturing, and then took the company public on the Toronto Stock Exchange in 2013,” says Jenks, a veteran of the B.C. logging industry, both in the B.C. Interior and the Coast.

In 2015, Jemi Fibre was highlighted as a top company on the TSX Venture 50 List.

The company’s operations consist of stump-to-dump contract logging operations in Mackenzie and Cranbrook, B.C. and Saskatchewan, post and peeling facilities and two pressure treating plants, and, most recently a chipping operation in Cranbrook. The company also logs on its own private timberlands. In 2014, it purchased 49,500 hectares of land and timber rights in the East Kootenays, from Tembec, which used to have extensive mill and logging operations in the region.

Earlier this year, Jemi Fibre was acquired by CanWel Building Materials Group Ltd., and Jemi is now a division of the company. CanWel owns and operates 17 building material distribution treating centres and 10 treated wood plants in Canada and the U.S. and is one of the country’s premier vertically integrated building materials company.

It’s a good fit, says Jenks.

“Joining CanWel allows us to be part of a larger entity with deep and effective sales and distribution channels, operating expertise and a strong balance sheet,” he says.

“Amar Doman, the Chairman and CEO of CanWel, and I had an instant rapport and a shared vision of what the combined companies could do together. Amar’s background and family history in the forestry business is of tremendous value to me as well as his proven track record of acquiring companies through CanWel.

Company president Mike Jenks (left) and Jake Blackmore, Jemi Fibre’s vice-president of Kootenay operations, at the company’s treating operation in Cranbrook, B.C.

“We’ve worked hard building a highly strategic, valuable and integrated collection of assets, and look forward to continuing our company’s vision as part of CanWel.”

Back in 2013, that vision included taking Jemi Fibre public on the TSX, so that it could seize opportunities in the forest industry, says Jenks.

“After the downturn, I saw some real opportunities in the industry—but we needed to go into the public marketplace on the stock exchange to get the capital,” he says.

“There were a lot of opportunities there, if I could figure out a way to access capital.”

Today, Jemi Fibre has major harvesting operations. In B.C., it does about 300,000 cubic metres a year, stump-to-dump, for one of the major forest companies operating in Mackenzie, and they do an additional 200,000 cubic metres for that company in the Kootenays. Jemi Fibre has a joint venture in Hazelton where they are doing 110,000 cubic metres a year, they do about another 200,000 cubic metres in BC Timber sales and about 400,000 cubic metres on their own private land.

In Saskatchewan, they harvest about 142,000 cubic metres, much of which is used for their wood treating plant there. They also have a wood treating plant in Cranbrook.

This is a lot to cover off from their modest office in Cranbrook, but Jenks says it works well because the company is organized along divisional lines.

“Each division is treated at arm’s length, and is responsible for its own operations, and any profits or losses,” he says.

In addition to contract logging, Jemi Fibre also logs on its own private timberlands. In 2014, it purchased 49,500 hectares of land and timber rights in the East Kootenays from Tembec, which used to have extensive mill and logging operations in the region.

“We gather the information and ensure we are documenting everything, from fuel costs to labor costs, for the divisions. That way, we can easily separate the different pieces of the company, and see how they are performing.”

They are continually doing comparables from division to division at Jemi Fibre, benchmarking the high performers, to see what they are doing right that might be transferred to another division.

“We look at why they are doing well—is it the terrain? Is it the timber they are working with? What are the reasons for the difference? This is a big focus for us, so we can make the right decisions for the individual pieces of the operation.”

Jemi Fibre has a different business model vs. a traditional logging operation or mill, in that it has both logging and sawmilling, and added value, under one company.

That diversity is intentional, and can be of benefit, says Jenks.

“With dimensional lumber, we don’t see the affect of the ups and downs in the lumber price as much, because we have the treated wood side of the business,” he explains.

“And we have our logging operations in different geographical areas, and markets, and species. If you are in one specific area for logging, you can have a weather or other risk. But if you are spread out, the chance of you getting that same weather risk in a number of areas is much less.

“For example, we may get a later spring break-up here in the Kootenays, but we could get an earlier break-up in Mackenzie or Saskatchewan. Things like that can reduce your risk. And then we can also operate on our own private land, so we have the ability to market log, and take advantage of good markets.” That’s something a traditional logging contractor can’t do.

“We’re always looking to get more diverse, and utilize more of the fibre,” Jenks adds. Hence, the company’s name is Jemi Fibre—not Jemi Logging or Jemi Milling. “Our goal is to achieve full wood utilization, especially off our own lands.”

Their most recent venture is building a chipping plant in Lumberton, just outside of Cranbrook, where they also have a post manufacturing facility. That full wood utilization is readily evident at the post plant, where they turn out posts from 28” to 35 feet in length.

On the logging side, Jemi Fibre’s work for a major forest company has grown significantly over the years.

In 2012, Tembec, which had been made a major forest industry player in the Kootenays, sold its B.C. Southern Interior wood products assets to one of the majors. Tembec’s Elko and Canal Flats sawmills and the associated Crown tenures, consisting of approximately 1.1 million cubic meters of combined Crown, private land and contract annual allowable cut, were also purchased.

The major forest company that acquired the assets switched from tree length to cut-to-length wood, and were looking for a logging partner to help with that transition, says Jenks. “We needed to upgrade all our equipment for the shift to CTL, and we needed to grow because they were looking for us to take on more wood.”

Jemi Fibre’s size gives them leverage on the equipment side to log that wood. On the harvesting side, they are heavily focused on using Southstar heads, which Jenks praises for their emphasis on service.”Their whole focus is on customer satisfaction—and as a logging contractor, that’s important.”

And on the equipment side itself, while they have Hitachi, Tigercat and John Deere iron, they have a strong emphasis on Cat equipment, through Cat dealer Finning, in both B.C. and Saskatchewan.

Jemi Fibre does a lot of their own equipment manufacturing for the pole division. Often they will manufacture their own equipment or take components and add their touch to it, to customize it for their operations.

“Finning is the same way with service as Southstar,” says Jenks. “Their focus is on keeping their customers happy, providing us with the parts and service each of our operations needs. Their product support is pretty exceptional.” He’s wary of equipment dealers just interested in getting their equipment out in the bush, with little in the way of follow-up service.

While Finning has been long established in B.C., it acquired the Cat dealership in Saskatchewan, Kramer Tractor, in 2015, and has since re-branded it.

There are definite benefits from being a large operation, says Jenks. “The guy that owns a couple of trucks buys tires from the local tire shop—we buy them by the containerload because we need that many tires—and we get a better price.” They have also put in their own fuel cardlock in Cranbrook. “Buying so much fuel gives us a bit of an advantage—it all adds up,” says Jenks.

The equipment line-up for Jemi Fibre is massive: combined, the operations in B.C. and Saskatchewan have more 300 pieces of logging equipment, from bunchers to processors to loaders to excavators to dozers, forwarders and low beds … and more.

Their latest equipment acquisition is a ROB (Remote Operated Bulldozer) steep slope harvesting system, purchased from Canadian dealer, Island Pacific Logging, in Chemainus, B.C. ROB is a steep slope logging system which uses a winch-assisted, dynamic rope system based around a bulldozer. Both Jenks and Jake Blackmore, the company’s vice-president of Kootenay operations, saw the ROB system at work on Vancouver Island, and were very impressed with its capabilities—and are confident it will work well in the steep slopes they are working with in the Kootenays.

“The ROB system stood out as the most efficient and safest way to harvest on steep slopes. We’re just learning it, but we’re super excited,” says Blackmore. There’s reassurance in that there is plenty of expertise available from the New Zealand-based developers of the ROB system, in addition to Island Pacific’s experience with the system.

Jemi Fibre’s goals include being diverse, and utilizing as much of the fibre as possible. Their most recent venture was building a chipping plant in Lumberton, just outside of Cranbrook, B.C., where they also have a post manufacturing facility.

The Kootenays region has plenty of steep ground for such equipment as it takes in four mountain ranges: the Selkirks, Purcells, Monashees, and the Rockies.

And there is going to be a fair bit of steep slope wood in Jemi Fibre’s future. “There is a lot of steep ground out there that got passed over for harvesting during the downturn, as a cost savings measure,” says Jenks.

For work in steep slopes, Jemi Fibre also has two Tigercat 830 bunchers. “One has a hitch on it for bunching, and we built what we call a Ninja grapple on the other 830, to tether it. Both the 830 machines are exceptional in the really steep ground.”

Every piece of equipment is allocated to a specific company division, Jenks explained. “When we move something from Saskatchewan to Cranbrook, it will get taken out of the Saskatchewan equipment inventory and go in the Kootenays inventory, and all the costs are now allocated to the new division.

“Everything has a unit number, and everything is tracked. When a piece of equipment gets a part or the mechanics work on it, it gets allocated to that machine.”

Jenks notes that the company overall, regardless of the division, has a strong focus on preventative maintenance. “It’s a huge focus for us,” he says. “We have a shop here in Cranbrook, with field mechanics, we have a big shop in Mackenzie, and we have two shops in Prince Albert, Saskatchewan, one for trucks and one for the logging equipment.” They also have a rebuild shop on Vancouver Island, where three or four pieces of equipment go a year, for complete rebuilds, from the frame up.

“We do a lot of the work in-house—fabricating, undercarriage work, engines, transmissions, to help keep control of costs,” explains Jenks. “We use the dealers to do the warranty work—but other than that, we do everything else.”

Jake Blackmore, who heads up the post manufacturing side, notes they also do a lot of their own equipment manufacturing for that division.

“With the equipment we use for manufacturing, you just can’t go out and buy it—so we make the equipment or we take components and add our touch to it. Buying fence post manufacturing equipment is not like buying sawmill equipment. A lot of our equipment is home-built or purpose built,” says Blackmore.

Having access to timber through their private lands is very beneficial for their manufacturing arm, says Blackmore. “We have the flexibility to select the right trees for our operations vs. just taking what might be available,” he says. “It’s really helped with the quality of our wood—our wood is sought after because we can select the right wood out of that much volume.”

Blackmore has experience on both the manufacturing side, and in logging—he used to log for Tembec. He bought Kootenay Wood Preservers in 2010, a company that was later merged into Jemi Fibre.

The people who work for Jemi Fibre, Mike Jenks notes, are very resourceful. “We’ve had good luck with producing our own equipment on the wood treatment side, but then we have really good people. I think the success of the company— whether it is the manufacturing side or the logging side—lies in the people we’ve been able to attract to work with us.”

All divisions combined, Jemi Fibre has 550 employees—and, says Jenks, lots of opportunity.

“I think we’re pretty unique,” he says. “We have a forestry department that does the road and logging layouts, we build the roads, we harvest and haul the wood, and manufacture and treat the wood, and sometimes take it right to the orchard that buys the posts we manufacture. So, we take it from the mountain side right to the orchard or vineyard.”

And with the company’s acquisition by CanWel, they now have a strategic advantage of being able to grow sales through coast to coast and U.S. distribution. They can also piggyback off CanWel’s national presence in treating wood in such areas as volume purchasing, production, access to materials and expertise.

“We also plant our own trees—we planted 1.2 million seedlings this year, and next year, we’re on track to do two million.”

Jenks says that the downturn in the oil patch has made it easier for them to get skilled people.

“The only thing that concerns me is that when the oil patch takes off again, some of them are going to be gone, because they are motivated by the big money. We can’t compete with that, but we can offer people the opportunity to be home every night.” And it offers the lifestyle of living in one of the most beautiful areas of B.C., nestled between the Purcell and Rocky Mountains.

Between the contract logging they do, on their own land, and BC Timber sales, the company works hard to keep its people in the woods busy—which is key to hanging on to them, says Jenks.

“We have some flexibility to work in different areas of our private land, managing our contract cutting, and timber sales—it helps keep our guys employed, so we don’t have long break-ups here. We’re able to offer that continuity of work, and have our people work 12 months of the year.”

He added that the company also has a good training program, which gives summer students the opportunity to get into the forest industry.

“We invest a lot of money training people, but it has paid off.” As have their efforts at safety, he says.

“We want to make the best use of the resource, but we want to do that safely—we want everyone going home safe at the end of the work day.”

There are almost certainly further business initiatives ahead for Jemi Fibre. “The way we operate is we’re always looking for something that is broken, where we have the ability to fix it and turn it into something that is profitable,” says Jenks.

“That’s what I’ve always focused on—not so much on acquiring something that is working well. You can’t really upside something that is running well. We want to add value.”

After decades in the forest industry, some might be choosing to be looking to take a step back, perhaps even consider retirement. That does not seem to be remotely on Mike Jenks’ radar—he has more work to do.

“We’re not the kind of company that sits back and says, ‘well, we’re done’. We’re looking for new goals.”

And the company seems to thrive on challenges. “What drives the company is a problem—when a problem comes up, how do we deal with it,” he says.

The new chip plant is a case in point. When pulp wood deliveries were re-scheduled until 2017, they found a market for their pulp wood—and built the chipping plant.