How the record-high price of lumber is impacting Vancouver Island mills and builders


Lumber prices hit another new record high this week, and the soaring cost is having both positive and negative impacts on Vancouver Island businesses.

At the Paulcan and Jemico Enterprises mill in Chemainus, the record demand for lumber has caused it to pivot.

Instead of sending much of its softwood lumber to Japan, it’s now selling it locally and to the U.S.

On Monday, the price of lumber hit a record high — surpassing $1,300 U.S. dollars per thousand board feet.

“This is by far the highest I’ve ever seen it. What it’s allowed some of the coastal mills here is to take some of that money and hopefully put it back in and modernize some of our industry,” said mill owner Paul Beltgens.

And the price of lumber has changed relatively quickly.

Beltgens said the last few years have been brutally tough and at the beginning of the pandemic, the industry was suffering. But then things changed.

“With everyone staying home and building and with the low-interest rates it has certainly improved the fortunes of the forest industry.”

The mill currently has 50 employees and Beltgens says he would hire 14 more if he could find people with the right experience.

But on the other side of soaring lumber prices are builders and consumers.

“It’s getting a little ridiculous for sure,” said Paul Bowater of Mid Island Homes. “I have a feeling that builders are just going to stop and take a break because the only thing we can do is pass the cost onto the people buying the houses, and they’re not going to be able to afford it.”

Bowater pointed out one development in Nanaimo that is proving to be a challenge because the homes were all pre-sold before construction.

Three of nine homes have been built so far and he believes material costs have gone up close to 50 per cent.

“At the end of the day, we just hope that we’ve made enough and we can get them done quick enough, fast enough where there is still going to be a profit at the end of the job.”

Bowater says the meteoric rise in lumber is unsustainable.

Back at the sawmill, Beltgens agrees. He foresees lumber prices dropping later this year as more competition moves into the market.

Earlier this month it was reported the high price of lumber is adding $30,000 to the price of a new home.

Kendall HansonKendall Hanson

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