Canadian lumber companies are rubbing their hands together in anticipation of a sharp boost in demand for their main product, which has already spiked in price as thousands across the Northeast United States seek to rebuild homes and businesses.
“When you look at the devastation, it's mind boggling, and it's going to have an impact,” Richard Garneau, the CEO of Resolute Forest Products told the Canadian Press earlier this month.
"They're going to have to rebuild, but it always takes some time for the cleanup to be done, so I think the impact on demand of wood consumption is probably going to materialize in the second and third quarter of next year with the rebuilding efforts,'' Garneau added.
Indeed, just days after the storm made landing, on Oct. 31, U.S. lumber futures hit a multi-year high. Lumber mills, which usually slow down or pause production during the winter months, are seen as likely ramping up their manufacturing capacity.
Michael Gravelle, the natural resources minister for the Canadian province of Ontario, told a local paper last week his government entity would be aiding mills that had closed down for the season ramp up production and even suggested mills that had been shuttered earlier due to the bad economy might be making a comeback.
Canadian producers are seen as particularly well-poised to take advantage of the sudden demand boom due to that fact that, according to Toronto’s Globe and Mail, the wet weather conditions in the Southern United States are making large-scale forestry activities unfeasible at the moment.
And luckily for them, it won’t be a suddent boost that will go away quickly either.
"The widespread impact of the storm could increase demand for lumber over the next several months. With such devastation, it could take a month or so for any rebuilding to start," Gary Vitale, president of the North America Wholesale Lumber Association, told Reuters.