Earthquake rebuilding likely to benefit existing timber exporters
When disaster response in Japan turns to rebuilding, Northwest timber companies and sawmills should see an increase in exports. But an industry consultant says the slow pace of disaster recovery means those new orders may not come for months.
Stock prices for some North American timber companies spiked in the immediate aftermath of the Japan disaster. Wall Street anticipates a surge in Japanese demand for logs, lumber and plywood to rebuild homes.
But profits won't materialize overnight, says forest industry consultant Haken Ekstrom. The president of Wood Resources International of suburban Seattle says much rubble remains to be cleared. Then the port terminals to receive imported lumber have to be fixed.
Ekstrom expects the rebuilding business to mostly go to companies with existing connections to Japan.
"You need to understand what the Japanese want because they are pretty demanding and specific in their needs, both when it comes to species, and quality and dimensions."
Ekstrom says the traditional export players include Weyerhaeuser, Canfor and TimberWest.
An Earthquake Started Export Market to Japan
Weyerhaeuser started selling lumber to Japan in 1923 following the Great Kanto earthquake that devastated Tokyo and Yokohama. Last month, the Weyerhaeuser Community Fund today announced it is donating $500,000 to the Red Cross to help with earthquake and tsunami relief efforts.
Weyerhaeuser employees subsequently added $55,000 from their own pockets to the donation, according to company spokesperson Bruce Amundson.
Meanwhile, raw log exports to China are on the increase as demand rises for Northwest harvested timber.