By Reg Barclay
Copyright 1998. Contact publisher for permission to use.

The historic, charming town of Huntsville is nestled in the heart of "cottage country", about 220 km north of Toronto. Among the myriad lakes and rolling green hills are countless cottage retreats for busy Torontonians and the retired. While city folk comprise a big chunk of Huntsville's business, the town also benefits from a solid industrial base supplied by a nearby papermill, a particleboard plant, several industrial firms, and a hardwood sawmill. The hardwood sawmill, owned by Tembec Inc. and employing 250 people, has had an interesting and, most recently, a successful history.

In 1994, a reman plant to produce flooring was built on site, which currently consumes about 60 per cent of the sawmill's output. Another 30 per cent is used for pallets, and the remaining 10 per cent - the select grade - is sold for millwork and cabinetry. According to Kenton Martin, General Manager, the hardwood mill was experiencing financial difficulty when purchased by Tembec in 1989. At that time, the mill was cutting both softwood and hardwood, producing about 200 products for a customer base of 600. With the flooring operation, the operation is now much more simplified. The sawmill cuts only hardwood, it produces three basic products and it has only three principal customers. The end result: a profitable operation.

The innovative and bold strategy taken at Huntsville was likely inspired by the Tembec special management style, which can be summed up by the company's logo - a blue stylized hawk with the words "the spirit of innovation".

These words also reflect the company's unusual beginnings. In 1973, the employees, assisted by the community of Temiscaming, Quebec, bought the town's pulp mill, its economic lifeline, when the multi-national owner ordered its closure. Not surprisingly, company policy since then has been employee-oriented, encouraging employee ownership, profit sharing and participation in management decisions. The formula has been successful. Twenty-five years later, Tembec Inc., with its head office in Montreal, now has 24 plants with 5,000 employees and annual sales of $1.5 billion.

The Huntsville sawmill operation is supplied within a 160-km radius by a surrounding forest composed of hardwood species such as maple, cherry, beech, yellow birch and poplar, with a light mix of red and white pine. The sawmill takes the decorative hardwoods, and trades or sells the poplar and pines.

The forest of mixed species lies on the southern edge of the Canadian Shield, in a narrow east-west belt bordered by the boreal forest, with spruce and jackpine in the north and the Great Lakes to the south. This forest has long been exploited because of its proximity to highly populated southern Ontario. But Martin says that has changed, and he is proud of the responsible sustainable forest management which has been practised over the past 25 years.

The harvesting method is single-tree selection on a 20-year rotation. Selection is on the basis of taking the diseased, lower-quality trees of zero growth and opening up the stand to provide for regeneration and to foster rapid growth of better-quality trees to maturity. Of the trees harvested, 50 to 70 per cent are pulp quality; the balance is destined for the sawmill. Martin notes that the target for opening the canopy is restricted to 30 per cent, so that harvesting is virtually invisible to the untrained eye from the roadside. This is important because the surrounding country is highly populated.

The mill's log supply comes from a mix of forest tenures. The company manages several Ontario timber licenses, which supply 25 to 40 per cent. Another 15 per cent comes from a private forest owned by the Schliefenbaum family, which is co-managed with Tembec. This is the first Canadian forest to receive FSC certification. Another five to 10 per cent is from public forest lands, which lay in small, scattered blocks of 100 to 1,000 acres. Tembec undertakes a private forest management service for these blocks, and FSC certification has just been received. The balance of logs are supplied from private forest owners, who harvest and deliver to the mill.

The sawmill. built in 1973, has a single line. It operates three shifts per day, 240 days per year, and produced 30 million board feet in 1997. This is a big improvement, as the mill was operating only two shifts, producing 12 million board feet, prior to the acquisition.

The log yard is extensive - and needs to be - to handle the sorts by species and to separate FSC-certified logs. Also, inventory is accumulated during the winter as logging is suspended from April to July to prevent ecological damage to the forest. Logs are delivered in random lengths of 8' to 16' and range in diameter from 8" to 35".

Logs are batch-fed to the mill by species and FSC-certified logs. At the infeed, bark is removed by a 35" Nicholson ring debarker. The headrig is a 7'Letson Burpee double-cutting band saw with a TS Manufacturing-made carriage. Cants are processed automatically by a new TS gang edger with an Innovec optimizing package. Side cuts are handled by a Mainland manual edger, and there is a horizontal Forano resaw for outside cuts needing further work. The mill cuts only boards 1-1/16" thick, except for small heartwood squares for pallet spacers.

There are two manual trim saws, which feed onto a covered green chain, with three basic sorts-pallet flooring and select grade. From the green chain, flooring and select grade are taken to a Lawson stacker, where stickers are manually inserted between each course in preparation for drying in one of eight Coe batch dryers. Species are dried separately, since drying times can vary from 10 to 30 days, to a moisture content of six to nine per cent. After drying, stock is stored for two to six weeks as a buffer inventory for the flooring plant.

The sawmill is highly focused on recovery and yield, which is the basis for bonus payments to employees. A comprehensive daily report is posted for each shift and for each species, which shows actual results compared to targets for logs consumed, mill production, grade out-turn, lumber revenue, log and wage costs; at the bottom is the net result of all these factors in profit before tax.

The flooring plant, now four years old, is a smart new facility, spacious and clean with excellent employee facilities. It produces 10 million square feet of flooring a year. Up to 80 per cent of the hardwood supply comes from the adjacent sawmill; the balance is purchased from outside, mainly in red and white oak, which is not natural to the surrounding forest but is in high demand for flooring.

Graders at work assembling flooring bundles. The flooring graders build random length bundles in three grade categories. Pieces within a bundle generally average 3' in length, with a minimum 1' length.

Tembec calls its product solid "Northern Hardwood Flooring", which is available in cherry, red and white oak, birch, maple and ash. There is even a birdseye maple grade. The product is offered in several grades from clear to rustic.

Prefinished flooring is growing rapidly in demand and now constitutes 20 per cent of sales. Finishing is contracted out to a modern facility, which applies and cures seven coats with a roller system. The water-based UV finish is environmentally friendly, with no VOC emissions or chemical solvents. The prefinished flooring line is called Muskoka, the general name used for the Ontario district in which the mill is located.

The flooring plant is a combination of manual and automatic equipment. Dried lumber is de-stacked, monitored for moisture content and then ripped automatically by optimized ripsaws into three widths: 1-1/2", 2-1/4", and 3-1/4". Boards are then cut to eliminate defects. This process is now half automated with a BMI optimized cutoff saw made in North Carolina called The Brute, which is safer, can run at 1,000 lineal feet per minute, and delivers higher productivity than manually operated cutoff saws.

From there, flooring blanks are surfaced and tongue and grooved with a WACO planer fitted with six heads, which runs 350 lineal feet per minute, one width at a time. Tembec prides itself on the accuracy of the flooring surface match, which must be perfect for high-quality installations such as gym floors.

Following the planer, six manual finished defect saws cut for grade before each piece is automatically end-matched. Graders then build random-length bundles in three grade categories. Pieces within a bundle generally average 3'in length with a minimum length of 1'. When complete, bundles are automatically strapped with nylon strapping.

Sales of flooring have increased rapidly since the plant was built. According to the Tembec annual report, sales increased in 1997 over the previous year by 33 per cent. While the main sales focus was initially on Europe, particularly the UK, sales have since been diversified. Asia has been the target, and sales reached 20 per cent of total revenue before the market collapsed recently. Since then, sales have been diverted to the strong US market.