by Tyler Durden
Saturday, May 01, 2021 - 06:00 PM
One of the most important things we ve learned over the past year is the vulnerability of global supply chains. Most notably, supply disruptions of lumber have catapulted prices to the moon.
The narrative touted in the public domain is that COVID-19 sparked a dramatic underestimate in capacity by sawmills early in the pandemic as the Federal Reserve slashed interest rates to zero, sparking a housing boom. The influx of demand outpaced supply and has caused lumber prices to jump 340% from a year ago, according to Random Lengths.
In terms of output, the lumber industry is controlled by just a handful of firms, including Weyerhaeuser Co., Georgia-Pacific LLC, West Fraser Timber Co., Ltd., among others, which makes it easier for capacity to be controlled.
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Inside the Market’s roundup of some of today’s key analyst actions
ARC Resources Ltd.’s (ARX-T) $8.1-billion merger with
Seven Generations Energy Ltd. creates a “premier low-cost, Montney producer that should be able to recognize substantial cost savings going forward,” according to iA Capital Markets analyst Michael Charlton.
Following Tuesday’s close of the combination of Alberta-based producers, Mr. Charlton thinks ARC “has no shortage of runway ahead” with more than 1 million acres in the Montney Formation to develop as “the dominant condensate producer in Canada, the third-largest natural gas producer, and sixth-largest upstreamer.”
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The global wood products market is expected to grow from $624.22 billion in 2020 to $666.43 billion in 2021 at a compound annual growth rate (CAGR) of 6.8%.
Wood Products Global Market Report 2021: COVID-19 Impact and Recovery to 2030 provides the strategists, marketers and senior management with the critical information they need to assess the global wood products market as it emerges from the COVID-19 shut down.
Major companies in the wood products market include Georgia-Pacific Corporation; Weyerhaeuser Company; West Fraser Timber Co Ltd; Andersen Corporation and Celulosa Arauco y Constitucion.
The growth is mainly due to the companies rearranging their operations and recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges. The market is e
Wednesday s analyst upgrades and downgrades - The Globe and Mail theglobeandmail.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from theglobeandmail.com Daily Mail and Mail on Sunday newspapers.
Forest-products stocks on a roll as lumber prices soar. Here’s why the rally may continue Bookmark Please log in to listen to this story. Also available in French and Mandarin. Log In Create Free Account
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JONATHAN HAYWARD/The Canadian Press
Lumber prices are soaring, driving big gains in the share prices of Canadian lumber producers so far this year. The best reason to stick with the rally rather than trying to time the top of the cycle: Stock prices aren’t reflecting all of the underlying good news yet.