Tree Frog Forestry News

Wood studs and wood chips – the rest of the story

Letter by Don Wilson, Brule Point, N.S.
The New Glasgow News
July 11, 2019
Category: Business & Politics
Region: Canada East, Canada

RE: Wood studs under pricing pressure.  …lumber products are a commodity needed more some times than at other times. As such, the price goes up and down with demand. This is why sawmills have to be always looking for ways to be most efficient and to vary production in line with market demand. Nova Scotia sawmills that have an agreement to accept logs from the allocation given to Northern Pulp (NPNS) by the province can find themselves in an overstocked position when demand slackens. …These sawmills need to supply chips no matter how much lumber is in demand or at what price. Being forced to increase sawn lumber inventory rapidly absorbs cash flow. …If NPNS is closed the sawmills could immediately begin sawing out all the lumber in each log. That would more than double the gross margins of these mills. …Closing NPNS could be a net gain for the GDP of the province considering that clear-cutting could cease and only high-value trees are selection harvested.

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