Ontario/Quebec Business Trends

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There is real optimism in the Quebec and Ontario SPF community.  An Ontario wholesaler remarked that “the market is good for everything and everybody.”

There is, according to a Quebec wholesaler, “A shortage of supply across the board for most species throughout North America and most mills are booked until January probably.  Prices are on the upswing and we could see $1000 wood into the Toronto market in the next 10 days.”

Noted an Ontario wholesaler, “Prices came down but then they bounced right back up. We saw the price come off its high, it went down about $400, but it has gone up already by $250 in last 3 weeks.”    

Looking ahead, an Ontario producer said, “I think the first six months of the year should be very good.  I believe the markets will be robust from January to March both in Canada and the U.S.” 

“There will be good demand and a shortage of supply,” remarked a Quebec wholesaler. “Demand will stay high because customers and dealers inventory levels are low right now.”   

Those remarks were mirrored by a Quebec producer, who said, “Because customers (dealers) have a very low inventory, they are going to be pushing these numbers crazy high again. They are going to be buying.” 

“For the near future, there will be some headaches for builders and retailers, but not for the primary manufacturers. It is going to be just fine,” an Ontario mill reported.  

A Quebec wholesaler noted, “There are really no weaknesses right now in the market, zero, generally everything is selling.”  

The SPF community expressed some concern about transportation. “There is a shortage of rail cars and transport will be an issue this winter.  That is not going to change,” according to a Quebec manufacturer. 

Several people also noted the change in the tariffs. “The duty has gone down from 20.23 percent to 8.99 percent, so this is no longer an overriding issue, whatsoever,” a Quebec wholesaler noted. “It is good that people got some relief on the duties, it is going to be another positive factor that will help.  We would still like to see a zero rate, but this represents some real progress.” 

An Ontario producer remarked, “The Pine market is about the same as it was a couple months ago.  Things haven’t changed really.  We face the same dilemmas, such as shortages of stock.”

An Ontario wholesaler reported that “prices are still firm which is a real positive.  Typically, this time of year things begin to come off a little bit.”  

A Quebec producer indicated, “We are starting to see a little slowdown, but this is really a traditional thing around Christmas anyway.” 

 As for the near future, an Ontario wholesaler expects a “decent spring is coming on again.” 

One of their Quebec counterparts remarked that “speaking to my network, it doesn’t sound like there are any big obstacles in the way of a good market right now for the beginning of 2021.”  Still, “the COVID factor dominates our concerns when we look ahead, it is the one uncertain influence we can see right now that could (and it might not) slow us down and change the playing field.”  

According to an Ontario Pine producer, “People are aware that cases have been going up in both producing and consuming areas, really in all areas, and things could change pretty quickly as we get further into the winter.”  

Noted one of the Ontario wholesalers, “People are encouraged that residential construction numbers are good in both Canada and the U.S., and the trend to seeing homes being purchased in advance is certainly interesting for us.  We are well aware of the increase in recreational home/cottage sales too and certainly this will generate activity for us down the road.” 

A manufacturer in Quebec reported, “We are seeing that pretty much the full range of grades are moving well, with the exception of maybe selects.  Big builders that are using natural wood for mouldings, etc. are now moving out of the main building season, and things are starting to taper off a bit.”   

This was echoed by a Quebec wholesaler, who indicated, “The only weakness really is the Selects, but this is typically not the time of year you would move Selects to a significant degree anyway. They will still move here and there, but you will not see the big quantities moving this time of year.” 

An Ontario Pine wholesaler did not see the transportation issue as bad for their segment of the industry, noting that “transportation is holding its own.  We wouldn’t entertain any increases if the suppliers were to push them, with the fuel prices down from what they were a few years ago.  There is no reason why they should be ramping that up and I don’t see that changing much. It is all seasonal but you are coming into the slower time of year for us, demand is down, so transportation is more readily available.” 

The Province of Ontario, like other jurisdictions, has indicated that despite some good trends, many people are still not back to work, and that the government must continue to support businesses, especially small businesses.  They do note that employment in the province increased by 36,600 in November and that those numbers include 1,700 in the manufacturing sector.  This is the sixth consecutive month that employment has gone up in Ontario. 

By Richard Lipman

Richard Lipman Guest Writer Miller Wood Trade Publications

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By Richard Lipman

Richard Lipman Guest Writer Miller Wood Trade Publications

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