A weak Loonie, an expiring softwood agreement and poor demand from Asia has lumber prices down sharply in the Pacific Northwest.
F.H. Stoltze Land and Lumber in Columbia Falls has not had any layoffs due to the poor pricing, general manager Chuck Roady said Monday, but Canadian firms are certainly doing their best to undercut U.S. prices, sometimes by as much as $130 to $140 a thousand board feet.
Adding to the problems is an expiring Softwood Agreement between the U.S. and Canada. The agreement, which has been in effect for decades now, placed a tariff on Canadian imports. But it’s set to expire Oct. 12 and when it does, Canadian lumber could flood U.S. markets. If another agreement isn’t struck between now and then, there will be no agreement for another year in what’s known as a one year “stand down.”
While Stoltze hasn’t hasd any layoffs, Tricon Timber in St. Regis announced it was laying off 90 employees, the Missoulian reported today. Roady said optimally the next agreement would include a volume quota to protect U.S. mills. Montana’s congressional delegation last week urged the Forest Service to at least give mills some temporary help.
One way to do that is to extend the term on existing contracts, said Montana Wood Products Association spokeswoman Julia Altemus. That would give mills more time to pay off existing contracts. But both global and domestic forces are hurting the market, said Shawn Church, editor of Random Lengths, a wood products trade publication and market tracker. Church said the composite price for dimension lumber is currently about $297 a thousand board feet, compared to $394 a year ago.