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Lumber price rise gives boost to West Fraser
26/04/2010
Due to strengthening lumber prices, West Fraser Timber Co, the largest softwood producer in North America, was able to report a profit for the first quarter of this year on Friday.
Profits for the quarter were at C$34 million, a significant improvement on the loss of C$80 million the company made during the same period last year.
West Fraser has mills in both the USA and Canada and shut down its Eurocan linerboard mill in Kitimat, British Columbia, late in 2009. The positive results can be attributed to a number of factors including a reduction in production capacity in the industry, inventory re-stocking and a boost in the US housing market.
Some analysts sound a note of caution, however, that prices may not remain so buoyant as mill owners restart idled mills in the US and Canada and capacity increases.
West Fraser pointed out that its Canadian sawmills have been operating at near capacity but its mills in the US were operating at reduced capacity due to wet winter conditions.
The company’s shares have risen in value by more than 73 per cent compared to last year.
Profits for the quarter were at C$34 million, a significant improvement on the loss of C$80 million the company made during the same period last year.
West Fraser has mills in both the USA and Canada and shut down its Eurocan linerboard mill in Kitimat, British Columbia, late in 2009. The positive results can be attributed to a number of factors including a reduction in production capacity in the industry, inventory re-stocking and a boost in the US housing market.
Some analysts sound a note of caution, however, that prices may not remain so buoyant as mill owners restart idled mills in the US and Canada and capacity increases.
West Fraser pointed out that its Canadian sawmills have been operating at near capacity but its mills in the US were operating at reduced capacity due to wet winter conditions.
The company’s shares have risen in value by more than 73 per cent compared to last year.
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