Lumber futures jumped to a six-month high as two producers plan to close mills in British Columbia, fueling supply concerns as a beetle infestation decimates forests in the region.
West Fraser Timber Co. said yesterday it plans to shut its mill in Houston, British Columbia, and Canfor Corp. will close its Quesnel site in the province. The Vancouver-based companies cited a timber shortage after forests were ravaged by the mountain pine beetle. Lumber futures have surged 22 percent since the end of May.
The shutdowns will aggravate supply concerns already heightened by low inventories, said Paul Jannke, an analyst at Forest Economic Advisors LLC, an industry consultant in Westford, Massachusetts. The announcements marked the first major closures linked to the beetle scourge, which has destroyed an estimated 710 million cubic meters of timber, he said.