B.C. lumber producers face potentially heavy losses as commodity prices continue to fall while punitive U.S. softwood lumber duties have risen.<\/p>\n
Weakening U.S. housing construction has added further strain on B.C.\u2019s forest industry, raising the likelihood of more mill shutdowns and layoffs. Lumber prices have flatlined in recent weeks due to weak demand, just as new, higher duties in the Canada\u2013U.S. softwood lumber dispute took effect.<\/p>\n
Mills in the province are now operating at losses of up to US$220 per thousand board feet of two-by-fours, a standard industry measure. Prices for spruce, pine or fir two-by-fours slipped to US$482 per thousand board feet in the week of Sept. 19, down from US$506 a month earlier.<\/p>\n
Market conditions in September, normally a favourable period for sawmills, have turned sharply negative this year and are expected to remain weak through the end of 2024, likely forcing mills to take downtime.<\/p>\n
\u201cWe\u2019re seeing it already,\u201d said Kim Haakstad, CEO of the B.C. Council of Forest Industries. \u201cWe\u2019re seeing temporary curtailments, extended holiday breaks, and reconfigured shift schedules. Here on Vancouver Island, we\u2019ve got a mill that\u2019s closed for the rest of the year.\u201d<\/p>\n
Haakstad was referring to the Western Forest Products sawmill at Chemainus, which was shuttered in June, putting 150 employees out of work. The company announced this week it will remain closed until the end of the year while also shortening hours at its other operations, trimming output by six per cent. Western Forest Products cited \u201cpersistently weak market conditions,\u201d combined with higher U.S. lumber duties and \u201ca lack of available economic log supply.\u201d<\/p>\n
Interfor Corp. also said it will cut production by 12 per cent across its Canadian and U.S. operations through reduced operating hours, extended breaks and maintenance shutdowns.<\/p>\n
The production cuts come on the heels of the U.S. Department of Commerce\u2019s latest decision in the softwood lumber dispute, which doubled the average combined countervailing and anti-dumping duties to 35.19 per cent.<\/p>\n
In response to mounting pressure, Forests Minister Ravi Parmar announced changes this week to the province\u2019s B.C. Timber Sales agency, aimed at easing conditions for the sector by making it easier for smaller mills to access timber.<\/p>\n
Earlier this year, Parmar commissioned a review of B.C. Timber Sales, which manages about 20 per cent of the province\u2019s timber harvest. An expert panel produced 54 recommendations, including expanding community forests in interior municipalities such as Vanderhoof, Fort St. James and Fraser Lake, allowing them to secure a stable log supply for local mills. Other proposals included lowering barriers for small companies in timber auctions, developing new products that use more parts of trees, and building stronger partnerships with First Nations.<\/p>\n
Parmar said he intends to implement the changes as quickly as possible, though some will require legislative approval.<\/p>\n
Haakstad welcomed the minister\u2019s commitment but emphasized that additional measures beyond B.C. Timber Sales are urgently needed. She pointed to the province\u2019s slow permitting process, which can take two to three years, as a major obstacle.<\/p>\n
\u201cWhen you don\u2019t have access to logs, there are no options,\u201d she said. \u201cIf you have access to logs, you have options to keep those facilities running. Unfortunately, we already have a number of mills operating at reduced shifts and not running at full capacity. We\u2019re starting to get to a point where it will be very hard to look at temporary reductions in operations.\u201d<\/p>","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":97039,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[5204,4715],"tags":[4018,3306,3743,3348],"class_list":["post-97038","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-news","category-market-analysis","tag-bc","tag-lumber","tag-producers","tag-sawmills","topic-forestry","topic-lumber","topic-price-analysis-and-info","topic-sawmilling","topic-statistics","topic-wood-construction","topic-wood-products","area-global","area-north-america"],"acf":[],"yoast_head":"\n