Post by
retiredcf on May 25, 2021 7:27am
CIBC
Our Conclusion
Canadian lumber producers should see reduced profitability later in Q4 as duty rates more than double (to levels a bit higher than we expected). Among the Canadian lumber producers, our top pick remains WFG (and we continue to rate IFP, CFP and RFP Outperformer). Based on current W.SPF pricing levels (~$1,630/mfbm), duties would increase from $134/mfbm to $252/mfbm. While this is a meaningful increase in the cost curve for B.C. producers under mid-cycle prices, it is relatively insignificant in the current commodity backdrop (and we would expect duties to go down again after a year).