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Moving into manufacturing

Ledcor Resources and Transportation has moved into producing solid wood products with a new $18 million sawmill in Chilliwack, B.C. that takes low-end logs and manufactures multi-dimensional cants, and lumber.

By Paul MacDonald

The B.C. forest industry has proven very talented at getting the most out of every log that is harvested—from directing logs in the bush to the right sawmill, through to the sawmill and the products that are manufactured out of those logs.

Following in that spirit, Ledcor Resources and Transportation has set up a sawmill producing cants in Chilliwack, B.C., about an hour east of Vancouver.

The B.C.-based Ledcor Group, which is well known as one of North America’s leading construction companies, got involved in the forest industry in a major way in 2011 when its subsidiary company, Ledcor Resources and Transportation, acquired Renew Resources, a company that specializes in the processing of marginal wood fibre in the B.C. Interior. The division produces woodchips and hog fuel and transports it to customers, including Howe Sound Pulp and Paper on the Sunshine Coast, north of Vancouver.

In 2011, Ledcor also took delivery of twelve new barges to inaugurate its marine transportation service to Howe Sound Pulp and Paper. Its forestry division also includes harvesting and trucking operations. Heading up Ledcor’s transportation and resource operations is Paul McElligott, former President and CEO of TimberWest Forest Corporation.

The $18 million sawmill in Chilliwack marks the company’s first venture into producing solid wood products. It also produces biomass material, and wood chips.

Ledcor Resources and Transportation has a number of forest tenures in the B.C. Interior. The Chilliwack mill processes low-end logs from the Cariboo-Chilcotin, Vanderhoof, Thompson Rivers, and Cascades forest districts, manufacturing multi-dimensional cants, and lumber. Any high-end logs from the company’s tenures are traded or sold to high production dimensional sawmills. The company also sources logs from contractors in the Fraser Valley for the sawmill.

Ledcor’s approach to wood resource utilization has received praise from the B.C. government.

“I welcome Ledcor’s innovative approach toward utilizing this often over-looked fibre supply and ensuring that every inch of the felled tree is put to use,” said Steve Thomson, B.C.’s Minister of Forests, Lands and Natural Resource Operations, at the official opening of the Chilliwack mill this past summer.

Cal Martin, who founded Renew Resources, and is now senior vice-president of Ledcor Resources and Transportation, had been considering a mill operation to process lower quality wood for some time.

Martin, along with Don Quan, director of operations for Ledcor Resources and Transportation, led the move to set up the new mill, and oversaw its development.

The company started construction work on the Chilliwack mill in spring 2012. Sawmill construction veterans Ed Vervynk and Terry Hamilton, who have worked on a large number of sawmill projects in B.C., were brought on board to oversee the Chilliwack project. Both men now work for Ledcor; Hamilton is manager of the sawmill.

“We came in and the company told us what it wanted to do, which was basically build a sawmill that was going to produce cants,” said Hamilton. “We started talking, and things evolved as we got to know the log diet, and we made changes to handle an increased volume and flow.

“Ed and I have been working on sawmills all our working lives, and working with the Ledcor folks, we came up with some ideas on how the mill could be changed to work better. There were no extra costs involved with most of the changes we suggested. But it delivers a better flow and overall makes the mill more efficient.”

They brought SKS Engineering on board, to work on the evolving sawmill design. In fact, the former president of SKS Engineering, Neil Syme, came out of retirement to work on the project.

With its varied sawmilling equipment sourced from the B.C. Interior, Washington and Montana, Chilliwack Ledcor mill manager Terry Hamilton likens the mill project to a big Lego set—that resulted in the company saving millions of dollars vs. purchasing new equipment.

Along the way, Ledcor also decided to consolidate other operations at Chilliwack, and moved a whole log chipper and hog operation from Princeton, about 100 kilometres from Chilliwack.

All of their SPF wood comes from the B.C. Interior, including a fair amount of beetle kill wood, while their hemlock comes from the Fraser Valley. “We can cut both species at the same time, and then we grade them and stack them separately,” explains Hamilton. About 60 per cent of their wood is SPF, and 40 per cent hemlock.

“We’ve got a pretty small site—we really don’t have the log yard to be switching from species to species,” says Hamilton.

A good portion of the yard not used by the mill itself is used for log storage. On a given day, they will have up to 50 loaded logging trucks coming in through the mill gate. The balance of the yard is used for lumber storage.

True to its name, Ledcor Resources and Transportation has in fact been very resourceful with the mill—just about every piece of equipment on site was purchased used, rather than new, in an effort to get the best bang for their investment dollars.

“The conveyors are new, and some of the unscramblers are new, but our main sawmill breakdown equipment is used, the debarker is used, the chippers, the hogger and the packagers are all used.”

They have an A5 Nicholson debarker which feeds into a refurbished HewSaw R200 which they bought directly from HewSaw, followed by home-made turning equipment, the green chain, and a Signode packaging line. “It’s a bit different, in that we have saws in front of the HewSaw,” says Hamilton. “It’s like a mini-merch system—we feed in any logs under 30 feet, and it cuts them to 10 and 13 foot pieces.”

They did a fair bit of work on the HewSaw, which was only partially rebuilt, including adding stainless steel chipping heads.

Their main merch system is a six-saw set-up, that sorts logs to seven bins. This home-made system was originally built by Carrier Lumber, in the B.C. Interior, and ran for only about a year, meaning it’s in good shape. “We bought everything on it, the infeed, the saw, the outfeed, and moved it down here,” says Hamilton.

The B.C. Interior proved to be a rich source of used equipment. “When they took the Weyerhaeuser mill out of Lumby, I think we bought just about every conveyor that came out of it. We contacted Canadian Mill Equipment, and said we’ll take it all.”

The log bins came from several mill locations in the Interior. “We sent a crew up there, dismantled the bins, marked them, put them on semi’s for the trip to Chilliwack, and then pieced them back together,” explained Hamilton.

They also have a CAE 60 inch chipper, a 62 inch Precision chipper, a 48 inch Jeffrey hammer hog, and BM&M chips screens. Their VFDs are from Arrow Speed Controls.

Out in the yard on the mobile equipment side, most of their equipment is John Deere from Deere dealer Brandt Tractor, including two Deere 744 wheel loaders, a 724 wheel loader and a Deere 2054 butt ‘n top loader. They have some used equipment including an older Wagner stacker. And more equipment is being added. “We just went to an auction in Aberdeen, Washington, and picked up two Barco stackers,” said Hamilton.

With its varied equipment, Hamilton likens the Chilliwack mill project to a big Lego set—that resulted in the company saving millions of dollars vs. purchasing new equipment.

Working on such a greenfield sawmill was new to Hamilton and Vervynk; both are used to tackling upgrades or additions to existing sawmills. And it was a challenge marrying all this used equipment together so the mill works smoothly. “You basically have all this used equipment, and it all has to come together.” He estimates that the used equipment probably came from upwards of 10 different sawmills from B.C., Washington State and Montana.

And it truly has been a work in progress; the sawmill started running on one shift in July, 2012 and there have been numerous additions since then. “Essentially, we started running the mill and were also still building it.” The hogger and the whole log chipper have been the most recent additions. A number of contractors have been involved with the Ledcor mill project including Iron Mountain Industries, Tebo Mill Installations, Automated Industrial, Apptec Consulting and Pacificon Systems Ltd.

Hamilton said there are generally two types of used equipment they they’ve purchased. “There is the used equipment that you buy and it goes right in, and then there is the used equipment where you need to weld it together, like the conveyors.”

And there are truly different types of used equipment out in the market, he added. “We have good, solid pieces of equipment that we bought, like the HewSaw, the A5 debarker and the merch deck, that went right in.” And then there is the not-so-good equipment that is to be avoided, some of which eventually finds a home in someone’s scrap yard.

The initial cost of used equipment is just a starting point when you are budgeting costs, Hamilton says.

“The challenge with used equipment is that the cost isn’t just in the equipment itself. The major cost is in the labor, to have it refurbished and installed. You might get a piece of equipment for $5,000, but when all is said and done, that might involve $50,000 of labor to get it into place.”

Some used mill equipment can be had for a fire sale price, but if it is going to cost a small fortune to fix or refurbish, it just plain isn’t worth it. “Sometimes used equipment is not the right answer.”

That said, wherever possible, they tried to get good used equipment and if it wasn’t available, they had it fabricated, such as with some of the conveyors.

Hamilton says that the technology at the Chilliwack mill is straightforward; there is no scanning. The HewSaw is manually set, and runs one cant diameter at a time. “So we’ll set it for 90 mm. by 90 mm., and run that for two shifts. And the next morning, we might run 120 by 120.”

The mill produces cants in four different sizes, 90 by 90, 105 by 105, 120 by 120 and 140 by 140. And it also produces boards, Hamilton explains.

“Once you get above a 140 by 140, which is basically five-and-a-half inches, it’s tough to pull a six by six inch or an eight by eight inch cant off the green chain. The HewSaw is a double arbor, so above 140, we’ll cut boards out of it, as well as a cant. So on the smaller wood diameters, we just cut cants, but on the larger wood diameters, we cut both cants and boards.

“When the mill was envisioned, boards were never going to be a big part of production. But now they are up to 40 per cent of our volume, depending on the diameter of the logs we receive.”

The mill has met with success, shipping boards and cants to customers overseas, including China, as well as to North American markets. It is now operating on a two shift basis.

Getting experienced people has been a challenge, as most of the primary sawmills—and experienced people—are located closer to Vancouver, rather than out in the Fraser Valley, where Chilliwack is located.

“Some of our employees have worked in reman or doing truss work, but that’s quite different from a production sawmill,” says Hamilton. “So we’ve spent a lot of time training people to make sure they are working safe.

“Safety is a priority—Ledcor is driven by safety. We have safety meetings for each shift every Monday, and if we are going to commission a new piece of equipment the middle of the week, for example, we will have another meeting to talk about that piece of equipment. Everybody has been issued their own set and locks—and they use them.”

With the mill now fully operating, Hamilton and the Ledcor crew have turned their attention to addressing bottlenecks, and doing some small tweaking. But it’s likely there will be further equipment improvements down the road. As Hamilton, a veteran of many sawmills, puts it: “Sawmills are really never done. Or if they are, they are not done for long. You’re always looking at improvements.”