Lumber futures rose to the highest in a month as some of Canada\u2019s biggest producers reduce output and transportation snags disrupt shipments to customers.<\/p>\n
March futures rose by the exchange limit of $45 Wednesday to $1,336 per $1,000 board feet in Chicago before paring gains. The surge comes as firms such as Canfor Corp. announce supply cuts in British Columbia, while port congestion and a lack of rail cars and trucks make it harder for Canadian companies to get timber to buyers.<\/p>\n
\u201cIn Western Canada these transportation challenges are really unprecedented in both scale and duration,\u201d West Fraser Timber Co. Chief Executive Officer Ray Ferris said Wednesday on an earnings call.<\/p>\n
Lumber futures have already gained about 34% this month as supplies remain tight ahead of the peak spring construction season in North America. That may add to the housing inflation that\u2019s already hurting buyers.<\/p>\n
Canfor said Tuesday it plans to cut 150 million board feet of production in British Columbia, citing impacts of the mountain pine beetle infestation and other constraints on available timber. At the same time, West Fraser said companies are facing shipping snarls after massive flooding late last year washed away rail tracks and shut highways in British Columbia.<\/p>\n
While repairs to rail and truck routes are progressing, West Fraser said its ability to \u201cship products in a timely manner remains challenged\u201d and the company said it was forced to take \u201cunscheduled downtime\u201d due to the transportation problems, according to a statement. The company may need to further reduce operating schedules to manage its inventory levels.<\/p>\n
Shipments to Vancouver have been most affected amid port congestion and a shortage of containers, West Fraser executives said.<\/p>\n
\u201cOur biggest concerns are just shipping what we\u2019re making today,\u201d Ferris said.<\/p>","protected":false},"excerpt":{"rendered":"
Lumber futures rose to the highest in a month as some of Canada\u2019s biggest producers reduce output and transportation snags disrupt shipments to customers. March futures rose by the exchange limit of $45 Wednesday to $1,336 per $1,000 board feet … Continue reading