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B.C. wildfires linked to rising lumber prices and rallying forest company shares

B.C. wildfires are being linked to rising lumber prices and rallying stocks for Canadian forest product companies.
B.C. wildfires are being linked to rising lumber prices and rallying stocks for Canadian forest product companies. THE CANADIAN PRESS/Sean Kilpatrick

Wildfires roaring through B.C. timber stands are being linked to both rising lumber prices and rallying stocks for Canadian forest product companies.

CIBC World Markets analyst Hamir Patel says lumber buyers appear to be worried about supply disruptions if this summer’s B.C. wildfire toll is as severe as last season.

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He says they’re also concerned about labour unrest following a strike vote last week supported by 93 per cent of the United Steelworkers members in several northern B.C. mills.

READ MORE: Canada’s lumber industry claps back after Trump links imports to California wildfires

The B.C. government reported as of Friday the total area affected by fire this summer was about 443,000 hectares, compared with more than one million hectares burned in the summer of 2017.

Shares in Canfor Corp. and West Fraser Timber Co. Ltd. both reached their highest closing price since July 18 on Friday, while Interfor Corp. hit its best close since July 19.

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Conifex Timber Inc.’s Friday close was the highest since July 26, despite reporting Thursday it had temporarily closed its Fort St. James, B.C., mill site as a precaution because of nearby fire activity.