Ontario Business Trends
Mixed Markets As 2026 Approaches Spring
January and February production declined due to unfavorable market conditions as well as to very cold and heavy snow storm conditions in most provinces and along the eastern U.S. border states, making it difficult for logging companies, sawmills, distribution yards and secondary manufacturers.
Several contacts stated being hopeful for improved weather conditions heading into March, along with better pricing conditions.
Sawmills advised green Ash was moving more consistently, even though sales were limited by supply rather than demand. For kiln-dried Ash, orders were noted as better to export markets, such as Vietnam and China for No. 1 Common and No. 2A compared to domestic markets.
Some mills that produce Aspen reported favorable sales, due to its limited production. Green Aspen is also in good demand, commented contacts.
Basswood sales vary according to regions contacted. For some it is a slow selling item, while others report brisk activity. Some grades are in shorter supply and is an issue for grades like No. 1 Common.
Birch demand has been identified as declining in both Canada and the U.S., especially to cabinet, furniture and wood components manufacturers. Flooring manufacturers in Canada continue to purchase this species but in lesser quantities than Hard Maple and Oak.
Hard Maple market conditions remain consistent for most grades and thicknesses. However, some describe sales as decent while others say they are less favorable. It was noted that demand from residential sports flooring manufacturers were steady for this species.
Interest in Soft Maple remains consistent for green and kiln-dried products. Contacts noted some sales operations offered discounted prices for kiln-dried No. 1 Common. As prices remained stable, received orders kept inventories in check.
Contacts hopeful for better days ahead.
Red Oak demand is decent for green No. 1 Common and Better grades, commented sawmill contacts. The lower grades are not as strong, although most have customers for developing production. It was noted that prices for certain grades had risen slightly. Contacts also reported kiln-dried activity had increased in mid-to-end of February.
White Oak demand seems to remain the same with sales based on specific lengths and supplies being purchased by established customers.
Canada Mortgage and Housing Corporation (CMHC) says it expects home sales to pick up this year, though demand is forecast to remain below historical averages as the economy grows slowly.
The agency’s baseline forecast is calling for 489,000 home sales for 2026 with an average price of $698,000, up from 470,000 homes sold in 2025 at an average price of $680,000.
Housing starts are forecast at 247,000 for 2026, down from 259,000 in 2025 as developers face high construction costs, weaker demand and rising inventories of unsold units.
CMHC notes that downside risks to its outlook are more likely than upside and cautioned that if Canada slips into a mild recession this year, the results would reflect weaker demand.
In that alternative scenario, CMHC predicts 480,000 homes sold and an average price of $693,000 for 2026. Housing starts in the alternative scenario are forecast at 243,000 for the year.
Also, The U.S. Forest Service announced it is offering grants through its Wood Innovations, Community Wood, and Wood Products Infrastructure Assistance programs. The agency is seeking proposals that strengthen forest resilience, support rural economies, expand wood product and energy markets, and increase processing capacity from eligible private, non-profit, Tribal and government entities.
The Forest Service is requesting proposals from eligible entities in the private, non-profit, and government sectors, including Tribes, local and state governments, businesses and for-profit entities, institutions of higher education, and public utility, fire, conservation, and school districts.
Prior to submitting an application, applicants must register on the Sam.gov website.
