Sawmills and Wood Production in Canada Industry Market Research Report Now Available from IBISWorld

New York, NY (PRWEB) February 20, 2015

The Sawmills and Wood Production industry in Canada has experienced challenging demand conditions over the past five years due to a cooling Canadian housing market and slowly recovering US housing market. In addition, the mountain pine beetle infestation in British Columbia, which is home to a third of industry establishments, is damaging a significant share of the province’s timber. “Despite ongoing obstacles, industry revenue has improved as a result of record-high demand for lumber in China over the period, and the resurgence of the US single-family home building market in 2012,” according to IBISWorld Industry Analyst Leah Goddard. For these reasons, industry revenue is forecast to grow at an annualized rate of 4.2% over the five years to 2015. Following a decline in revenue in 2011, brought on by a weakened US construction sector, strong growth is projected to continue into 2015. Therefore, industry revenue is anticipated to rise 6.9% to $ 13.3 billion over the year due to a more robust US housing market, and increased expenditure on nonresidential construction and residential renovation projects in Canada.

Suboptimal production volumes hurt industry profitability in the early part of the period. In response to shrinking profit margins, many companies exited the industry or consolidated operations by closing facilities and reducing staff. “Moreover, larger operators acquired smaller players to bolster their customer base and benefit from economies of scale,” says Goddard. Consequently, the number of companies operating in the industry is projected to fall at an average annual rate of 3.0% to 1,332 operators over the five years to 2015. As companies cut costs and unprofitable participants exited the industry, the average industry profit margin, measured as earnings before interest and taxes, recovered from 0.5% of revenue in 2010 to an estimated 3.0% in 2015.

Over the next five years, the Sawmills and Wood Production industry will benefit from strengthening demand for lumber, both domestically and internationally. The US housing market, which accounts for two-thirds of industry exports, is projected to grow rapidly over the period. In addition, increasing construction activity in emerging markets, particularly in Asia, will further contribute to export revenue. Moreover, rising construction and renovation expenditure in Canada will bolster domestic demand for lumber.

For more information, visit IBISWorld’s Sawmills and Wood Production in Canada industry report page.

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IBISWorld industry Report Key Topics

This industry manufactures boards, dimension lumber, beams, poles, ties, siding and wood chips from logs or bolts. The industry also produces pilings and posts treated with preservatives. Industry wood products may be rough, or dressed by a planing machine to create uniform sizes, but no further shaping takes place. The industry also includes companies apply preservatives to wood from other establishments. The industry excludes veneer or engineered lumber (e.g. plywood) manufacturing.

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About IBISWorld Inc.



Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://ift.tt/UiKiKD or call 1-800-330-3772.

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