Western Forest Products Inc T.WEF

Lumber prices

[lifeisgood1010]

Here is a very good link to follow the BC lumber prices.

You can compare the actual price to the record year of 2018 or 2019 or year to date...etc

Very good info.

https://www2.gov.bc.ca/assets/gov/farming-natural-resources-and-industry/forestry/forest-industry-economics/weekly-prices/forest_product_prices_-_2020-12-18.pdf

 

[Dadsaid2]

The link is very helpful and actually explains why WEF is not successful. WEF is mostly cedar. This weeks white wood 2x4 price of $ 874 is 76% higher than 2018. The cedar price of $1650 is 18% higher than 2018. Should be $2400. I would accept anything between $2000-2400 but the Western boys are sleeping at the wheel and giving away a more valuable species of tree at $1650. I can hear all the

[dosperros]

Nope, they are OK on pricing. Cedar is the superior product, but the TRX guys doing highly durable composites have been at their heels as a cheaper but decent substitute for ages.  Don't give them an inch, and the market has not.  Commodity lumber is better as steel studs are tough to work with, need crew re training, and are still costlier than SPF or HF or SYP studs. Not by

[Dadsaid2]

Trex and other composites are good products. People are using more and more brown PT as well which is SPF anyway. But both are nothing compared to a cedar deck. Same goes with siding, panelling, trim etc etc. The Japanese love their cedar but have out negotiated producers like WEF. Part of a company's make up is a marketing department. Its hard to make a commodity sexy but it is possible

[dosperros]

Yep. I agree. On the OSB examples, I think they had some room for tech/engineering innovation there and they were the cheap fallback to plywood at the time.  It's tougher to play that game when you're the high water mark as a natural product of course.  OSB did pick up a bunch of solid IP from Ainsworth too, so M&A on the Cedar front may help should that be thing. More

[sequesence]

I think you are bang on with your assessment of cedar pricing and WFP as a takeover target. We may see some small improvements in pricing going into the spring.

[jonvw92]

I agree Q4 and 2021 should be strong, but i am doubtful of a takeover unless it was from private equity.  I hope management is conservative with the dividend and aggressive on the NCIB out of the gate in January.  Management had previously stated they wanted to get debt down to around $80M and if Q4 EBITDA is strong they should be close now.  Sadly WEF was the wrong horse to play in