The weakening real estate market in Canada is evidently having downstream effects on the lumber industry, with West Fraser Timber (TSX: WFG) this morning announcing that it will be curtailing production of oriented strand board, or OSB, products.
The latest curtailment is set to occur at West Fraser’s High Level, Alberta mill, with the curtailment slated to take effect in the spring of 2026 following an orderly wind down and the depletion of existing log supplies. The curtailment will see West Fraser’s capacity for OSB decline by 860 million square feet, with the decision set to impact 190 employees.
Work opportunities are expected to be provided to employees impacted by the decision, where available.
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The curtailment is set to go on indefinitely, alongside a curtailment that was instituted at West Fraser’s Cordele, Georgia facility that came into force in 2023. That curtailment reduced capacity by 440 million square feet.
The curtailment is expected to result in a $200 million asset impairment, which will hit West Fraser’s fourth quarter financial results.
Notably, the curtailment follows the permanent closure of West Fraser’s Augusta, Georgia and 100 Mile House, British Columbia lumber mills by the end of 2025.
West Fraser Timber last traded at $86.48 on the TSX.
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