News in lumber

The sawmill business is and has always been cyclical. Today North America’s sawmills cannot keep up with demand, resulting in wood prices that are at historical levels and are continuing to climb higher. However, sawmill owners and their executive teams are overall not in a rush to build new facilities.

EACOM Timber Corporation has announced that it has temporarily shut down its Timmins, Ontario, Canada sawmill operations after COVID-19 cases were confirmed at the site. According to Biliana Necheva, EACOM public relations senior advisor, there have been four confirmed cases among the 132 employees at the Timmins site.

Unrelenting building demand, the result of the COVID-19 pandemic, amongst other things, has kept U.S. sawmills from being able to catch up with that unabated demand. With U.S. builders needing lumber coverage, but rarely asking about price, suppliers have been forced to look for product sources apart from their traditional suppliers.

Firefighters from seven different communities’ departments spent five hours on Saturday (5-8-21) battling a fire in a new sawmill just outside the City of Cornell Wisconsin. According to Cornell Area Fire Department’s Assistant Chief Matt Boulding, the building, and its contents are a total loss.

Economists are warning that the current increase in lumber prices might last for an extended period of time. To that end, many Alaskans already tired of higher lumber prices have decided to either build their own or purchase a portable sawmill.

The susceptibility of the global supply chain to suffer from major pinch-points and headwinds has never been clearer than during the ongoing COVID-19 pandemic. There was a significant underestimation of how much products and services would be needed, resulting in major supply chain issues in everything from lumber, to semiconductors, to shipping capacity and labor.

The Forest Economic Advisors LLC, (FEA) annual survey of the “Top 10” Canadian lumber producers reflects the unprecedented year that the industry has seen as a result of the COVID-19 pandemic. The Canadian lumber market had been tough in 2019 with a number of mill curtailments and closures, but there were signs of a recovery late in the year and into the first months of 2020.

Demand for wood and wood products is unrelenting. Resulting in lumber prices reaching historic high levels and daily climbing ever higher. The shares of publicly traded lumber manufacturers, distributors and retailers wood suppliers continue to soar. While oddly enough, trees themselves remain dirt cheap in places like Louisiana, where timber supplies are plentiful.

Astara Capital Partners, LLC (“Astara”) announced on Thursday (4-15-21), that it has acquired a majority stake in Cross City Lumber (“CCL”). Based in Cross City, Florida, CCL is a Southern Pine sawmill that produces specialty and dimensional grades of lumber. Astara leveraged its network of sawmill executives to source the opportunity and to underwrite a series of capital projects that will substantially increase the capacity of CCL and significantly reduce its breakeven point.

Rayonier Advance Materials (RYAM), a global leader in high purity cellulose pulp, and GreenFirst Forest Products Inc. (GreenFirst), a Canadian lumber company, announced today that the parties have entered into a binding asset purchase agreement in which RYAM has agreed to sell all of its six lumber and one newsprint facilities and related assets located in Ontario and Quebec to GreenFirst for an expected purchase price of approximately $214 million (USD), including inventory on hand at the time of closing, which will be payable in approximately 85% cash, 15% common shares of capital GreenFirst.