Photo By West Fraser
Many of North America's largest lumber producers are reporting sales that are smashing expectations.
West Fraser recently reported second-quarter earnings of $1.48 billion, a 61 percent increase over the first quarter. $955 million of that came from its lumber segment.
Resolute Forest reported revenue of $1.1 billion. The company's shares have risen 76 percent since the beginning of the year and its stock has quadrupled in the past 12 months.
Weyerhaeuser reported its "strongest quarterly results on record" - surpassing last quarter's EBITDA record by 40 percent. The Seattle-based producer also generated record operating cash flow and reduced long-term debt by $225 million.
Canfor, which recently curtailed production due to wildfires, saw a more than doubling of its year-over-year income.
As is now infamous, lumber prices reached extraordinary levels during the pandemic - peaking at more than $1,700 per thousand board feet in May. This forced many lumber companies to ramp up production. U.S. producers expanded production by 5 percent over the past year.
Prices have since come down. They now sit at around $479 per thousand board feet and have finally fallen below pre-pandemic levels. But analysts say the drop won't be seen in companies' financial reports until the third quarter.
Some analysts believe an oversupply is mounting.
Stay tuned for more updates.
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