Canadian firm Western Forest Products is to switch its focus from structural lumber to higher value export markets, after recording a downturn in business in the fourth quarter.
Sales fell from C$176.5m to C$136.6m quarter-on-quarter, with year-long sales down from C$896.8m to C$890.5m between 2006 and 2007. Lumber sales fell from C$141.6m to C$93.3m quarter-on-quarter, although the value of log sales rose from C$26.5m to C$29.6m.
The results were driven by the continued downturn in the US construction market and the strength of the Canadian dollar, Western said, as well as strike action by the United Steelworkers Union in the second half of the year.
“The company plans to respond to these market conditions by limiting exposure to the US housing market and through a reduction in the harvest of mid-grade hemlock logs, which are typically destined for the US structural dimension market,” it said.
“Western also expects to focus on diversification of its product offering both in terms of product attributes and geographic selling destinations.”
Western added that it ceased to be a member of the Forestry Industrial Relations employers’ group as of March 1, due to diverging business strategies and labour negotiation issues.
