Canfor Corporation recently reported a net loss of $9.6 million for the third quarter of 2011, compared to net income of $26.2 million for the second quarter of 2011 and net income of $37.2 million for the third quarter of 2010. For the nine months ended September 30, 2011, the Company's net income was $48.9 million, compared to $116.4 million for the comparable period in 2010.
Results for the third quarter of 2011 included costs associated with the restart of the Vavenby sawmill on one shift in September.
Commenting on the quarter, Canfor's president and CEO Don Kayne said, "The U.S. market remains challenging as the economy struggles to emerge from its slump, and there remains little prospect of a meaningful recovery in the short term. On a more positive note, we continued to see strong shipment levels and increased demand for higher value products in our offshore markets during the third quarter."
North American lumber markets remained weak in the third quarter of 2011 reflecting the struggling U.S. economy and housing market. U.S. housing starts for the quarter averaged 615,000 units (seasonally adjusted annual rate - SAAR), up eight per cent from the previous quarter, though the increase substantially reflected higher starts for multifamily units, which use a lower proportion of lumber than single-family units. The benchmark Western SPF (spruce-pine-fir) 2x4 #2-and-better price moved up three per cent to US$246 per Mfbm, though wider SPF products showed moderately higher increases.
Shipments and earnings levels for the lumber operations showed little change from the previous quarter, though production was up three per cent, principally due to improved productivity.
The company operated at 74 per cent of lumber capacity in the third quarter, up from 72 per cent in the second quarter; lumber production was approximately 930 million board feet, up slightly from the previous quarter, which for the most part reflected productivity improvements.