Money Closed mills, housing surge support positive forecast for lumber, OSB industries
Real estate market hits new heights in the National Capital Region
Despite an ongoing shortage of affordable housing, 2019 was a record year for real estate in the the Ottawa-Gatineau area.The trend looks set to continue in 2020, but comes at a time when the region is grappling with a lack of affordable housing.
CALGARY — Financial analysts say Canadian production cutbacks and a consumer-driven recovery in housing starts in the United States could mean better times for lumber and panel products this year.
In a research report, RBC analyst Paul Quinn estimates B.C. lumber producers have permanently closed mills accounting for 18 per cent of the province's capacity, a move that is expected to help to bring North American supply in line with demand and support price increases.
He adds the closure of three oriented strandboard mills and part of another has removed about 9.5 per cent of North American OSB capacity.
Forecasting Canada’s economic future is now about risk management, not one-way bets
In December, I used Montreal-based New Look Vision Group Inc. as an example of the sort of confidence that could explain the unexpected surge in business investment during the third quarter. But I didn’t mention why chief executive Antoine Amiel was feeling so good. Unlike, say, the automobile industry, the future burns bright for optometry. Almost everyone acquires presbyopia (farsightedness) by middle age and the population is quickly aging. There’s also a “worldwide crisis of myopia,” Amiel said, because youngsters are spending more time indoors, reducing their exposure to natural light. “Those are fundamentally positive trends for the industry.
RBC is forecasting that U.S. housing starts will increase by about 2.5 per cent this year to 1.3 million units, driven by strength in single-family housing, and there will be further gains in lumber demand from the adoption of "mass timber" methods which allow construction of taller wooden buildings.
Meanwhile, CIBC analysts are also bullish on the lumber sector in North America, given stronger housing starts this year and their estimate of a five per cent decline in supply from last year.
In a report, they say they expect a robust spring selling season, with lumber prices and producer share prices likely to rise.
"2019 was one of the worst years in memory for lumber and OSB companies, with most reporting significant declines in profitability and seeing their equity value deteriorate," noted RBC's Quinn.
Going, going, gone: Ottawa's last Zellers closing its doors
The Bells Corners store, one of the discount retailer's two remaining locations in Canada, will shut its doors for good by the end of the month.Yes, but not for long.
"However, a number of positive developments have us feeling increasingly bullish."
This report by The Canadian Press was first published Jan. 17, 2020.
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Surging rent costs push families to choose between housing and food, says advocate .
The Benedict Labre House says the demand for its food bank has quadrupled since 2018. They've gone from handing out 50 food baskets a month to more than 200. The community organization even had to set a monthly limit of one basket for each client to make sure everyone would be able to get food."We would like to be able to give them food every single week, but we just don't have enough," said clinical coordinator Francine Nadler.Nadler says demand isn't just driven by homeless clients.