Canada’s lumber producers ought to be enjoying the fruits of a U.S. housing recovery. Trouble is, they can’t take full advantage of it. The forestry companies say that a shortage of rail cars is causing them to lose sales and market share, just as American demand for their products returns after a long, severe slump.
The problems the companies say they face include irate customers threatening to impose penalties for late delivery; empty ships sitting uselessly in port for lack of lumber to move; and idled shipments that have to be stored under tents.
Western Canadian producers have added their voice to the chorus of industry complaints in Ontario and Quebec over major rail shipment delays.
The robust pickup in the U.S. housing market has resulted in new orders for lumber, strand board, plywood, pulp and other products, and Canadian producers require more rail cars to get those products south. But they claim the two major Canadian service providers – Canadian National Railway Co. and Canadian Pacific Railway Ltd. – are not doing enough to help them out of a jam.
“Slowly but surely, the lumber and panel and pulp markets are coming back and it’s getting more difficult to supply as quickly and as consistently as possible, especially with just-in-time delivery becoming commonplace,” says Doug Routledge, acting president of the B.C. Council of Forest Industries.