None thought that the forest fires in British Columbia (B.C.) on one end of Canada would have any impact whatsoever on Prince Edward Island (P.E.I.), sitting unobtrusively on the other end of the sprawling nation. But the fires combined with lumber export tariffs imposed by the United States (U.S.) have certainly made themselves felt on the Island in terms of plywood prices.
“It was a very bad situation in a very busy year,” Giles Gallant, a building supply manager for Home Hardware in North Rustico, Prince Edward Island, Canada, said to The Guardian. “All these factors made a big difference, something that no one expected to see – an increase [of prices] like this.”
According to Gallant, prices of lumber have risen 25 per cent for the spruce used in framing houses, and up to 60 per cent for plywood.
Executive Director of the Canadian Home Builders’ Association of P.E.I., Todd MacEwan, noted that the fires in B.C. as well as the tariffs in some cases have brought the supply of lumber down in Canada, though demand for lumber and plywood remained strong due to housing construction, especially on the Island.
“That just sort of filters down through the whole country,” MacEwan explained to The Guardian. “Most of what we get in Atlantic Canada comes from Ontario and Quebec. But demand in those markets would be greater than Atlantic Canada, so they’re meeting their own demand first. And again, it comes down to a supply and demand situation.”
But while the market would ultimately correct itself, prices may continue to climb even over the next year or more.
Fred Bergman, a senior policy analyst at the Atlantic Provinces Economic Council, also acknowledged that the forest fires in B.C. have played a part in lowering the available supply of lumber and plywood as mills have been forced to close its doors as residents were evacuated and shipping was affected. He also noted that although the mills were shut down and thus losing revenue, they were still paying for their fixed costs, raising prices.
Source: The Guardian