By Stephen Nakrosis
West Fraser Timber, whose products are use for home construction, repair and remodeling, said that some key trends that served as positive drivers in recent years are expected to continue.
On the outlook for shipments in 2023:
The company expects total lumber shipments in 2023 will be largely similar to last year, it said.
On the outlook for North America:
“Over the medium term, we expect that an aging housing stock, stabilization of inflation and interest rates and greater entrenchment of work-from-home flexibility will help to offset current headwinds from higher interest rates and historically low levels of existing home sales, spurring repair and renovation spending that supports lumber, plywood and OSB demand,” the company said.
On the near- and long-term outlook new home construction:
Demand for new home construction and wood building products may decline in the near term “should the broader economy and employment slow or interest rates remain elevated or increase further than currently expected,” the company said.
In the long term, “growing market penetration of mass timber in industrial and commercial applications is also expected to become a more significant source of demand growth for wood building products in North America,” West Fraser said.
On the outlook for Europe:
Near-term risks, including relatively high and rising interest rates, geopolitical developments and the lagged impact of recent inflationary pressures, “may cause further temporary slowing of demand for our products in Europe,” West Fraser Timber said.
“Although we continue to experience near-term softness, we expect demand for our European products will grow over the longer term as use of OSB as an alternative to plywood grows,” the company said. It also said an aging housing stock supports long-term repair and renovation spending and additional demand for its products.
Write to Stephen Nakrosis at [email protected]
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