By Mark Smith, Partner, FEA
In last year’s FEA annual survey of the “Top 10” Canadian lumber producers, the heading was “Coronavirus delivers a year like no other.” Little did we realize what was coming in 2021, with record prices for lumber, not only in North America, but globally.
FEA reports a U.S. Indice that reflects historical changes in a basket of structural lumber grades— and we had to change the price scale three times on the graph during the year to adjust for the price rises seen! These peaked about July 2021, fell back to levels that were still above historical averages, but once again showed strong upward growth and in Q1 2022, prices are again approaching last year’s historical highs.
Total North American lumber shipments: up by 0.5 billion board feet
Total North American softwood lumber shipments were up by just under 0.5 billion board feet (to 60.17 billion board feet from 59.73 billion board feet) in 2021 as compared to 2020.
This total North American growth of 0.5 billion board feet was identical to the increase seen in last year’s article, which reflected changes from 2019 to 2020.
Almost all of the growth seen coming into the 2021 year was from Canada where shipments were up by 1.7 per cent, contributing almost 0.4 billion board feet of the combined Canada/U.S. increase.
On the trade front, after sharp declines in the first half of last year, exports picked back up in the third quarter. However, for the year as a whole they fell, as high North American prices hurt the region’s competitive position, while strong consumption limited lumber available for export.
Meanwhile, those same high prices and strong demand have bolstered imports. As a result, North American exports decreased 8.4 per cent last year.
Canadian Top 10: shipments up by one per cent from 2020 to 2021
The Canadian Top 10 lumber producers saw shipments grow by one per cent in 2021 to 13.945 billion board feet compared to 13.803 billion board feet in 2020. However, the Top 10’s share of total Canadian shipments remained essentially the same—60.8 per cent in 2020 versus 60.4 per cent in 2021, as total Canadian shipments increased by 1.7 per cent (from 22.717 billion board feet in 2020 to 23.106 billion board feet in 2021).
The growth in Canadian shipments would have been even greater but for a number of factors during the year, including labour shortages, inclement weather and supply chain issues e.g., railcar shortages.
The Top 10 Canadian lumber producers remained the same through the top six from 2020 to 2021. These top six include West Fraser, Canfor, Resolute FP, Tolko, J.D. Irving and EACOM who collectively accounted for 10.9 billion board feet (47.2 per cent of total Canadian lumber output in 2021) which was marginally lower that 2020 (at 11.0 billion board feet) and at a lower percentage of total Canadian lumber output (which approached 48.6 per cent in 2020).
Effectively, the top six lost about 1.4 per cent of market share in 2021. Dunkley Lumber increased its production by 3.9 per cent which was enough to move it into the #7 spot, above Weyerhaeuser. And RYAM lumber (acquired by GreenFirst) fell out of the Top 10, to be replaced by Arbec that saw tremendous growth of over 36 per cent (please note that this increase is an estimate only and has not been able to be substantiated).
West Fraser remains in top spot with its Canadian output up a slight 25 million board feet (0.8 per cent) across its 12 mills. Canfor stayed second with 2.50 billion board feet, representing a slight increase of 10 million board feet across its 11 Western Canadian mills. Resolute FP continued at #3, with output at its 15 mills dropping by 134 million board feet (-6.6 per cent) after a stellar 312 million board feet (18 per cent) increase from 2019 to 2020. Tolko, at #4, also saw its output decrease by 30 million board feet (-2.2 per cent) as did #5, J.D. Irving, with a drop of 19 million board feet (-1.8 per cent). Finally, EACOM at #6 saw a small increase of 6 million board feet (0.7 per cent).
Continent-wise, the four largest North American softwood lumber producers (West Fraser, Canfor, Weyerhaeuser and Interfor) have operations in both the U.S. and Canada. Collectively, they produced 17.65 billion board feet (29.3 per cent of total North American lumber output) at 97 sawmills in 2021, strengthening their collective market share from the 2020 year (28.4 per cent). These publicly traded companies were positioned in the top nine in Canada.
Research by Chari Gimenez, FEA Canada
On the Cover:
Moggie Valley Timber, located in southwestern Ontario, is a sawmill that sells to lumber wholesalers and retailers, and has been in business for nearly a quarter-of-a-century. Moggie Valley Timber also carries out logging, cutting about 10 million board feet per year. On the logging side, in order to harvest the larger trees that Moggie Valley Timber comes across on woodlots in this part of Ontario, the company has invested in an Eco Log 590F harvester. Read all about how the Eco Log 590F is working out for Moggie Valley in this issue, beginning on page 34. (Cover photo and story photos courtesy of Moggie Valley Timber).
B.C.’s ILA show leading the pack …
B.C.’s Interior Logging Association is leading the pack when it comes to the re-start of forest industry events, with its equipment show and AGM coming up in May.
Cutting edge equipment—from cutting edge suppliers
A mill upgrade for Vicksburg Forest Products led to the company sourcing cutting edge equipment from a variety of suppliers—including from B.C. and Quebec.
Northland moves to partial processing—at the mill
Facing narrow log delivery windows, Alberta sawmill Northland Forest Products has decided to move to partial millyard processing, with two TreeKing processors.
Another successful convention expected for BC Saw Filer’s
The B.C. forest industry is facing challenges, but this year’s BC Saw Filer’s Convention & AGM—being held May 27 to 28 in Kamloops, B.C.—is expected to be just as big and successful as it was pre-COVID.
Iron investment handles bigger timber
Moggie Valley Timber has invested in an Eco Log 590F harvester to handle the larger trees that it comes across on woodlots in southwestern Ontario.
Canada’s Top Lumber Producers: West Fraser and Canfor on top!
Logging and Sawmilling Journal’s authoritative listing of Canada’s Top Lumber Producers—produced in association with leading forest industry consultants FEA—shows that West Fraser and Canfor are still the top lumber producers in the country.
New and Noted at the Oregon Logging Conference
The Oregon Logging Conference in February kicked off with great expectation following two years of in-person restrictions due to COVID. The OLC is widely known for its extensive, state-of-the-art equipment display—and we take a look at what was new at the show.
Included in this edition of The Edge, Canada’s leading publication on research in the forest industry, are stories from the Canadian Wood Fibre Centre (CWFC) and FPInnovations.
From power upgrades to production improvements, read all about what’s new in small scale logging equipment in this issue’s Tech Update.
The Last Word
Forest giant Canfor is applying sustainability across its entire culture in a bid to prosper in a post-pandemic world.