West Fraser Timber is now Canada’s largest softwood lumber producer, according to a new report.
The International Wood Markets (IWM) Group’s 2008 annual ranking of Canada’s top 20 businesses said West Fraser had replaced Canfor Corp as the country’s largest timber producer, a position which the latter had held for 10 years.
But, while it was good news for West Fraser, total softwood lumber production by the top 20 companies fell by 16.7% compared with 2007.
Meanwhile, total Canadian output fell by 20.5%, with the sharp slowdown in the North American housing market driving prices below cost levels to lows not seen since the 1991-1992 recession.
“Five Canadian lumber production companies reduced their 2008 ouput by a staggering one-third, while only two companies [in Western Canada] managed to increase production by more than 5%,” said IWM president Russell Taylor.
He also indicated that worse was still to come. “Further decreases in North American housing starts of another 30-40% in 2009 are guaranteed to further reduce lumber demand and lead to more sawmill curtailments and permanent shutdowns – and even some possible bankruptcies,” added Mr Taylor.
