Vancouver, British Columbia-based Western Forest Products saw lumber segment revenues rise despite a dip in log and by-product sales due to dry weather stunting log volumes during the third quarter, cutting company-wide quarterly earnings by nearly two-thirds to C$2.3 million (US$2.3 million) from a year earlier as sales slid C$14.1 million (US$14.1 million) to C$219.4 million (US$219.9) for the same period.
But strengthening North American demand driven by a U.S. housing recovery, coupled with modest declines in demand from China and Japan, the company says, pushed 60% of its lumber segment sales into the North American market compared to 48% a year earlier. Lumber production was up 7% from the second quarter of 2011 while lumber shipment volumes increased 4% to 218 million board feet for the same period. The company says lumber prices during the quarter—C$676 (US$677) per thousand board feet—are consistent with the year-earlier quarter, while its lumber-product sales mix shifted to include 3% more hemlock and western red cedar and 6% less Douglas fir for the same period. The company reports commodity lumber volumes down 5% during the quarter from the previous quarter due to log supply issues expect, contributing to price increases in the channel carrying into the fourth quarter.
The company announced a C$38 million (US$38 million) upgrade to its Saltair, British Columbia, mill to be finished by the end of the second quarter of 2013 while also adding automated lumber grading capabilities to its Alberni Pacific, British Columbia, mill by the end of 2Q 2013. View the full results.