EDMONTON - After reaching skyward over the past two years, lumber stocks are suddenly getting (ahem) nailed.
Sorry about the pun. But after watching shares of West Fraser triple over the previous 24 months, the recent slump must leave investors, um, pining for the good ol’ days.
So what happened? A perfect storm, that’s what. The first quarter of 2014 is one most lumber producers would surely like to forget. First, the harshest winter weather in a century slammed parts of the U.S. Midwest and northeast, cutting into construction activity. Second, a nasty six-week strike at Port Metro Vancouver, on top of ongoing railcar shortages in Western Canada, slashed some lumber producers’ shipments by double digits. Third, investors are rattled by growing talk that the U.S. housing rebound could stall, as home prices pick up and U.S. mortgage rates rise...
