This year, the U.S. has imposed an additional 6.76 per cent duty on Canada’s smaller lumber companies. (Ezra Black/The Free Press)

Lumber prices see ‘big jump’ after wildfires in B.C.

As early as Sunday, several companies temporarily closed some of their mills as evacuation orders

The wildfires in the B.C. Interior that have forced some sawmills to halt operations have resulted in a boost in lumber prices at a time when forestry companies have been squeezed by softwood duties on exports to the U.S.

By Wednesday, the benchmark price of Western spruce-pine-fir lumber had risen by 5.5 per cent to US$400 per thousand board feet from US$379 last Friday, according to figures from Random Lengths, which tracks lumber and panel prices.

“It’s a big jump,” said Shawn Church, Random Lengths editor.

Ketan Mamtora, an analyst with BMO Capital Markets, said he expects prices will rise between six and eight per cent over the next couple of weeks, partly due to a limited supply.

As early as Sunday, several companies temporarily closed some of their mills as evacuation orders, displaced employees, road closures and other factors made operations impossible or difficult.

It’s possible for the industry to increase capacity at other facilities, but Mamtora said it’s unlikely they can make up for all lost production. Fear over possible lumber shortages also “really pushes up the prices,” he said.

If the fires persist for a long time, that will have “a much more meaningful impact on pricing,” Mamtora added.

RELATED: Province will buy lumber to protect mills: Clark

In the case of mills staying shut for months or even sustaining damage, he estimates prices could rise between 15 and 17 per cent.

But Harry Nelson, an assistant professor of forestry at the University of British Columbia, said essentially the province’s entire production would have to be wiped out for such a spike to occur.

“At the end of the day, whatever hole these wildfires create gets filled in somewhere else,” Nelson said.

For weeks, Canada’s softwood lumber industry has been hit by U.S. duties, and companies operating in B.C. have been hit particularly hard.

On average, the lumber industry faces tariffs of 27 per cent. But West Fraser Timber (TSX:WFT), Canfor (TSX:CFP) and Tolko, all of which are headquartered in the province, have been charged duties of 31, 28 and 27 per cent, respectively.

The short-term lift in prices is good for producers, Nelson said, as it means more money in their pockets after tariffs are paid.

Aleksandra Sagan, The Canadian Press

Just Posted

Fake cop scares Brookswood drivers

Police have issued a warrant for a man allegedly behind a recent incident.

Langley Township seeking applicants for parks and rec

The Township is looking to fill some upcoming job vacancies.

TEDxLangley tickets now only available at the door Saturday

The annual conference takes place Saturday and features an array of topics.

Suspicious blaze guts car in Langley City

RCMP are investigating and looking for a suspect vehicle.

Langley ball hockey group rounding up equipment

A new initiative will help provide equipment for families facing financial hardship.

B.C. cougar kitten rescued after mother struck by vehicle

Conservation Officers find home for young kitten found dehydrated and frostbitten near Williams Lake

WestJet appeals lost bid to scrap harassment lawsuit

Airline argues judge was wrong to have dismissed the company’s application to strike the legal action

Can U.S. border guards search your phone? Yes, and here’s how

Secretary of homeland security explains a new policy that let’s border guards check phones

‘Beautiful writer’ Nancy Richler dies of cancer in Vancouver hospital

Montreal-born author spent most of her adult life in B.C. as a fiction writer and novelist

B.C. commuters vote to rename bus service to ‘Jeff’

The company asked and the people of Facebook answered

Students frustrated by UBCO response to harassment allegations

Students on the Kelowna campus were unaware of resources and worried about lack of communication

Aldergrove Kodiaks take beating

Aldergrove Kodiaks took a beating in their first period against Richmond Sockeyes Wednesday night

Women’s March Canada Fraser Valley slated for Saturday morning

It’s a march for women’s rights and social justice for the most marginalized

Police investigate sexual assault of teen girl on Abbotsford school grounds

Incident occurred Wednesday night on elementary school grounds

Most Read