Canfor Corp., one of North America’s biggest lumber producers, said this week that it will shift to a four-day workweek at most of its 11 mills in British Columbia and Alberta starting April 4; not because of inadequate demand, but because it’s run out of room to pile the boards that customers are ordering at a startling rate.
“We are experiencing extreme supply chain challenges,” Don Kayne, chief executive of Vancouver-based Canfor, said in a press release on March 31. “It has become imperative to reduce operating schedules to address our unsustainable inventory levels.”
The main issue appears to be a shortage of rail cars in Western Canada, where Canadian National Railway Co. and Canadian Pacific Railway Ltd. are struggling to keep up with the post-pandemic surge in demand for virtually every commodity that Canada exports in bulk. That means companies have been piling up inventory, as they wait for the railways to clear their backlogs. Things got so bad for Canfor that it ran out of space; the company said the new production schedule will reduce output by at least 100 million board feet at a time when lumber prices are sitting near an all-time high.
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