BRITISH COLUMBIA - With raging wildfires forcing the closure of several major Canadian lumber mills, analysts expect wood prices to rise as much as 6 percent.
 
If the affected Canadian mills remain closed for weeks, builders will have to absorb higher costs in their construction budgets. Those costs may affect home buyers, Bank of Montreal analyst Ketan Mamtora told Reuters in an interview.
 
BC Log and Timber Building Industry Association official Walter Bramsleven told Reuters he expects higher prices, but also that the fires could provide an opportunity if British Columbia grants access to the burned wood.
 

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Canada wildfires force lumber mill closures; prompt state of emergency

As wildfires continue to rage across British Columbia, several big Canadian lumber mills have been forced to temporarily close.


West Fraser, one of Canada’s largest producers of lumber, LVL, MDF, plywood, and other wood products, has closed three locations in British Columbia. Mamtora said the closures represent a loss of nearly 7 percent to British Columbia's overall lumber production, and a loss of nearly 14 percent to Canada's overall plywood production.

Norbord Inc., the world’s largest producer of oriented strand board (OSB), suspended all production at its mill in central British Columbia. Norbord runs 13 OSB mills across North America and employs over 2,600 people. Mamtora said the shutdown represents a 5.6 percent loss of Canada's OSB production.
 
Tolko Industries, headquartered in Vernon, B.C., says more than 60 fires are burning in the Cariboo area, several of which are threatening the community of Williams Lake and surrounding rural communities. As a result, it closed its Lakeview and Soda Creek divisions July 10, and managers are meeting daily to determine the operating status.
 
If the sites remain closed for months, Mamtora says prices could potentially increase 14 percent.
 
British Columbia even declared its own state of emergency – its first in 14 years – as it says over 200 fires are burning across the province. More than 14,000 people have been evacuated from their homes and workplaces.