West Fraser still North America's largest lumber producer, with 4.91 bbf in 2011, followed by Weyerhaeuser with 3.56 bbf, finds annual top 20 survey

Audrey Dixon

Audrey Dixon

VANCOUVER, British Columbia , March 20, 2012 (press release) – West Fraser Timber remains North America's largest lumber producer as the recovery starts to take hold, with China playing a larger role

The latest WOOD MARKETS annual survey of the "top 20" Canadian and U.S. lumber producers shows that West Fraser Timber has retained its title of being North America's largest softwood lumber producer in 2011 with 4.91 billion board feet (bf; or 7.8 million m3 net). The company was also Canada's largest producer while Weyerhaeuser was the largest U.S. lumber producer in 2011 and North America's second largest lumber producer with 3.56 billion bf.

These and other highlights were released today in the March issue of WOOD Markets Monthly International Reportthat was researched by the consultants at International WOOD MARKETS Group, Vancouver B.C. "With North American lumber production in 2011 increasing a modest 5.2% over 2010, the WOOD MARKETS survey provides further evidence that the fledgling lumber market recovery that started in 2010 has continued to build on itself in 2011 - albeit slowly," commented Peter Butzelaar, WOOD MARKETS Vice-President.

For the second consecutive year, the top 20 Canadian companies increased their market share of total Canadian lumber production, rising from 73.7% in 2010 to 76.8% in 2011. The order of the top five lumber producers in Canada was unchanged from 2010: West Fraser, Canfor, Tolko, Resolute FP (the new name for Abitibi-Bowater after re-emerging from creditor protection) and Tembec. These five firms produced a total of 11.0 billion bf (49% of Canadian lumber output) versus 10.3 billion bf (47.1%) in 2010. West Fraser retained its top position with output of 3.41 billion bf, 15.1% of total Canadian softwood lumber production, and the same share as in 2010.

Similar to Canada, there was no major change from 2010 in the order of the five largest producing U.S. companies: Weyerhaeuser, Sierra Pacific, West Fraser (U.S.), Georgia-Pacific and Hampton Affiliates.The output of the top 20 U.S. companies rose from 14.0 billion bf to 14.8 billion bf (+5.5%). Unlike in Canada, the growth rate for the top 20 U.S. lumber producers was at a slower rate than the average for all U.S. companies (+7.6% to 26.8 billion bf). While falling behind the average growth rate of the industry, the top 20 U.S. companies also saw their share of total U.S. production slip to 55.3%, versus 56.4% in 2010.

Total Canadian softwood lumber output rose from 21.9 billion bf in 2010 to 22.5 billion bf in 2011 (+2.5%), while U.S. production grew from 24.9 billion bf to 26.9 billion bf (+7.6%). "Although U.S. housing starts were less than stellar at 607,000 units in 2011 (up from 587,000 in 2010), North American lumber consumption showed modest growth of 640 million bf (+1.5%), coming in at 43.2 billion bf for the year," explained Russ Taylor, WOOD MARKETS' President. "As in 2010, offshore Asian demand (mainly Chinese) was the biggest factor driving the industry growth."

B.C. producers continued to benefit from China's expanding demand for North American lumber in 2011. Canadian producers (almost all from B.C.) increased their softwood lumber shipments to China to 5.0 billion bf nominal. In just two years, Canada has increased its shipments to China by 196%, to the point where Canada's exports to China are second to only to those of the U.S.

In comparison, U.S. firms exported much lower volumes to China in 20011, or 660 million bf nominal - this was still an increase of 190% over 2010 levels. This increase moved China ahead of Canada as the U.S.'s largest export market for softwood lumber in 2011.

The survey will show some interesting results in 2012:

  • It is expected that Temple-Inland's lumber and panel mill assets will be sold off by its new owner, International Paper;
  • Canfor purchased two B.C. sawmills from Tembec in early 2012 to add to its output;
  • There are a number of distressed sawmill assets that could be purchased by some of the larger companies - however, the timing needs to be right.
  • Based on the prevalence of merger and acquisition activity that took place in 2011, it would appear that several of the larger Canadian and U.S. firms could be preparing now for the anticipated lumber "super-cycle" that is expected by 2015 (or sooner). This will be a key topic at WOOD MARKETS' 2nd Global Softwood Log & Lumber Conference in Vancouver BC on May 9 where West Fraser will be a featured speaker on the North American lumber market outlook.

The complete Top 20 Lists and further analysis are available to subscribers of WOOD Markets Monthly International Report.
For further information or details on the "Top 20" lists, please contact:

International WOOD MARKETS Group (1) 604-801-5996 or e-mail:
Russell Taylor retaylor@woodmarkets.com
Peter Butzelaar peterb@woodmarkets.com

Two summary tables follow:



          CANADA TOP SOFTWOOD LUMBER    
          PRODUCERS · 2011 (Million Bf)    
  Rank       No. of     Production    
2010
2011

Company Mills 2010 2011
% Change
1   1   West Fraser 12 3,318 3,408   3%
2   2   Canfor 13 2,887 3,130   8%
3   3   Tolko 10 1,854 1,922   4%
4   4   Resolute (AbitibiBowater) 18 1,500 1,683   12%
5   5   Tembec 9 778 906   16%
          Total Top 5 62 10,337 11,049   6.9%
          Total Top 10 92 13,644 14,505   6.3%
          Total Top 20 109 16,167 17,281   6.9%
          Total Canada   21,945 22,497   2.5%
          Top 5 as a % of Canada   47.1% 49.1%    
          Top 10 as a % of Canada   62.2% 64.5%    
          Top 20 as a % of Canada   73.7% 76.8%    

Notes: Includes lumber produced only at primary sawmills and excludes U.S. production.
                     
                Source: WOOD MARKETS

 





USA TOP SOFTWOOD LUMBER


 



PRODUCERS · 2011 (Million Bf)

 

Rank


No. of
     Production
   
  2010
2011 Company
Mills
2010

2011                   
% Change  
  1   1   Weyerhaeuser   15   2,550   2,759 8%  
  2   2   Sierra-Pacific Ind.   14   1,672   1,800 8%  
  3   3   West Fraser   15   1,365   1,503 10%  
  5   4   Georgia Pacific*   16   1,074   1,074 0%  
  4   5   Hampton Affiliates*   5   1,100   1,000 -9%  
              Total Top 5   65   7,761   8,136 4.8%  
            Total Top 10   93   11,002   11,489 4.4%  
            Total Top 20   124   14,048   14,825 5.5%  
              Total U.S.       24,896   26,793 7.6%  
              Top 5 as a % of U.S.       31.2%   30.4%      
              Top 10 as a % of U.S.       44.2%   42.9%      
              Top 20 as a % of U.S.       56.4%   55.3%      

Notes: Includes lumber produced only at primary sawmills and
excludes all Canadian and offshore production.

   
* 2011 Estimate

                                                           Source: WOOD MARKETS


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