Elk Falls Workers

Campbell River B.C.

Friday July 17 – Mr Garneau Comes To Town

We were called by Richard Demchuck on Thursday and told that Mr Garneau, Boniferro, Johnston and others were in town the next day and wanted to meet with reps of both locals. He couldn’t tell us what the meeting was about so we took our standing committee. The meeting was basically a business review with Mr Garneau telling us how bad things are in the paper industry.  He went through a series of slides to explain how we had to reduce the cost of our newsprint to below $400 dollars per ton in order to have any hope of surviving the next few years. To get below $400/ton we would have to work for free. His point was we have to reduce our labour costs from $65 dollars per hour to below $40 dollars per hour, that’s including benefits. He reiterated that it isn’t only the Elk Falls mill that they expect to reduce the cost per hour, but all the Catalyst mills including the ones with a $80/ton plan.

He then went on to say that projected North American consumption will be  below what the American Papermills can produce on their own, so we won’t be able to export any newsprint to the USA. They also enjoy the black liquor subsidy that we don’t and he thinks they will use it to modernize their mills.

I was left with the impression that there are no plans to restart Elk anytime soon.  He did say it was only the mills with very low cost structures that will run.  He also commented on how the municipalities don’t seem to care about his tax problems and the Provincial Government isn’t interested in talking to Catalyst about it either.  He also doesn’t like how the Federal Government is administering the black liquor subsidy.  He said if we (the unions) could talk to all three levels of government it would be helpful since they are our government and will listen to us. He left us with all this information and suggested it was something we needed to think about.

He said it was clear his predictions about the industry had been right so far and reiterated the need to continue the course he is on.   At the end of the meeting he asked if we had any questions.  Since he had made it clear he wasn’t interested in debating his figures or his analysis of them, there wasn’t many questions.

I thought it was an odd meeting:  on one hand he says we have to reduce costs to run, but on the other hand says there isn’t any market for our paper now or in the future. He also said the market for all the other paper that Catalyst makes is also quickly eroding.

July 17, 2009 Posted by | - $80 Ton Updates | 6 Comments