Lumber boom helps N.S. forest industry offset loss of Northern Pulp
Industry members say full effect of mill shut down still to be felt
The boards stacked high in the yard at Elmsdale Lumber don't sit for long these days. Empty trucks arrive to cart them away to customers, just as more logs arrive to be cut into more boards.
"The demand is huge," said Robin Wilber, president of the company based in Elmsdale, N.S. "We can sell everything we make."
All things considered, it is going pretty well at this family-owned operation. It's a far cry from what people were expecting back in January.
Seven months ago, when the Northern Pulp mill in Pictou County shut down after failing to secure approval to build a new effluent treatment facility, many people in the forestry sector — Wilber included — feared the worst.
With the province's largest buyer of wood chips and other byproducts out of the game, sawmills such as Elmsdale feared for their future. After all, a log can't be cut into boards without producing byproducts, and those byproducts need to go somewhere.
Then came COVID-19, and fears increased.
"We were afraid, as every other industry was, what it was going to do to us," Wilber said outside the company's yard, trucks coming and going in the background.
But rather than prompting a shutdown, COVID-19 drove many people — hunkered down at home trying to help flatten the curve — to start thinking about projects.
"I don't think anybody saw that coming," said Wilber.
"We were wondering at the time whether construction trades would shut down, but that continued. Housing starts in Canada and the States were up high, and then four million Canadians went home and I think that they decided to build that deck or home renovations."
The result has been a seemingly insatiable demand for lumber across the country.
With such high demand comes supply issues, and with that comes price increases. Data from Natural Resources Canada show the price per 1,000 board feet of eastern two-by-fours has more than doubled since this time last year.
Lumber sales are filling the financial hole created by the loss of Northern Pulp.
"It's unbelievable, really," said Cassie Turple, communications coordinator for Ledwidge Lumber.
"I mean, nobody could have predicted the way that this year would have gone. That uptick in remodeling this year was not forecasted by anyone."
It's come at a crucial point for the industry in Nova Scotia. It's giving companies such as Elmsdale and Ledwidge breathing room as they continue to look for new markets and ways to diversify after the loss of the biggest player in the industry.
Both companies have found new destinations for their wood chips. While those arrangements don't pay anything close to what they were getting from Northern Pulp, lumber prices mean that's not as much of an issue.
Several months ago, Ledwidge was forced to lay off workers. That proved to be short-lived, and now the company is benefiting from prices nearly three times what it would normally get for its primary product, while production remains about what it would normally be for this time of year.
Jeff Bishop, executive director of Forest Nova Scotia, said the boom that sawmills are experiencing has a trickle-down effect on the rest of the industry.
"If those sawmills were not doing what they are — the business that they're doing right now inside of this pandemic — I suspect we would be hearing a lot more stories of sawmill closures and associated logging and trucking contractors who just wouldn't be able to do it anymore."
Still, everyone is being pragmatic. The price for lumber, like most commodities, is cyclical.
Wilber has been around this business long enough to know that every boom is eventually followed by a bust. Even with a return to what would be considered normal prices, he said it will reveal the full effect of the shutdown of Northern Pulp on Nova Scotia's forestry industry.
"Whether that's going to be three months or six months or a year, who knows. But it is going to come."