Canadian Forest Service Publications

A comparison of locating a cedar or hemlock remanufacturing facility in either the Fraser Valley or Whatcom County. 1993. Forestry Canada, Pacific Forestry Centre, Victoria, BC. Working Paper WP-OI-93.07, Copublished by the BC Ministry of Forests. 66 p.

Year: 1993

Issued by: Pacific Forestry Centre

Catalog ID: 3394

Language: English

Series: Working Paper WP (PFC - Victoria)

Availability: PDF (download)

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Abstract

The objective of this study was to investigate the relative benefits of locating a lumber remanufacturing plant in the Fraser Valley, British Columbia or in Whatcom County, Washington. At the time the study was commissioned, the BC forest industry perceived that a remanufacturing facility located in Whatcom country would be more competitive than a similar facility located in the Fraser Valley. This perception was a result of several firms to locate new remanufacturing facilities in Whatcom county, the availability of low cost industrial land in Whatcom county, and the use of non union labour in Whatcom county. During the project, exchange and interest rates moved dramatically, leading to different outcomes. Under the exchange rate in September 1992 (C$=US$0.84), cash flow analysis strongly favored Whatcom County, however by the end of November, the exchange rate (C$=US$0.78) and cash flow analysis favored the Fraser Valley. The volatility of exchange rates suggests that the industry should examine a range of factors that contribute to competitiveness.