Canadian sawmilling and lumber distribution business EACOM Timber Corporation saw its third quarter sales decline by C$10m to C$61.3m due to weak market conditions and lower production levels.

EACOM made headlines last year by diversifying from its core lumber trading business into sawmilling by acquiring the Domtar forest products business, complete with eight sawmills.

Net losses amounted to C$564,000, compared to losses of C$9m a year ago, due to better operating results, the sale of the Big River mill and a recovery of income taxes.

The company shipped 135 million board feet of lumber (mbf) during the period (2010: 151mbf). Benchmark lumber prices improved slightly but still reflect a slow new housing market.

Lumber production totalled 127mbf (2010: 130mbf) with the company operating at 49% of its capacity and two of the eight former Domtar mills idled and others subject to longer market-related downtime.

On October 8, the Gogama mill site experienced a fire, resulting in substantial losses to log and lumber inventories. However, the mill is intact and operations should resume in the fourth quarter.