Focus on OSB: North America | 21
construction begins soon, start-up will occur no earlier than 2027.
GROWTH OF RELATED LAMINATED STRAND LUMBER INDUSTRY Laminated strand lumber is an engineered lumber based on OSB process technology, but LSL utilises longer parallel strands. The LSL manufacturing process uses a steam- injected press to make thicker dimension- lumber sized billets, while OSB production uses a multi-opening or continuous hot press to make the substitute for structural plywood panels. Relative to solid lumber and veneer-based products, wood raw material suitable for stranding is cheaper, achieves superior yield, and is more forgiving in terms of size, quality, and acceptable species. To make OSB, whole logs are converted into strands about 1mm (.03in to .05in) thick,
long and the strands are laid down in cross- banded layers. LSL specifications slightly differ, with research showing that wood strands about 120 to 300mm (4in to 12in) long oriented on the length axis approximate the strength of solid lumber. Two North American mills currently
make LSL. Weyerhaeuser’s LSL mill in Kenora, Ontario produces the “Trus Joist Timberstrand” brand. Tolko’s OSB mill in Slave Lake, Alberta also makes the T-Tec brand of LSL. The Tolko plant produces as much high-
value LSL as possible and then converts leftover short strands into lower-value OSB. The Godfrey OSB mill may also manufacture LSL. Relative to a strictly OSB mill, a dual capability factory requires additional investment in strand storage and processing. In November 2024, Weyerhaeuser announced it will invest US$500m for a greenfield LSL mill in Monticello, Arkansas. The Arkansas and Ontario plants will have similar rated capacities (about 280,000m^3 per year). However, Weyerhaeuser believes that southern yellow pine fibre from Arkansas will result in stronger LSL than aspen fibre from Ontario. The company will supply the new mill from 500,000 hectares (1.2 million acres) of its forestlands in southern Arkansas. Better logs will go to the nearby sawmill and plywood plant, and lower quality wood fibre to this LSL mill.
UNCERTAINTY IN 2025 The impact of President Trump’s promised social and economic policies on the US homebuilding and building materials industries remains unknown. On March 1, President Trump signed executive orders intended to benefit the domestic forestry and wood products industry by easing timber harvest restrictions in national forests and designating wood product supply as a
Above: Engineered wood products exhibits at Weyerhaeuser’s booth at the National Association of Home Builders trade show in Las Vegas, Nevada in February 2025 PHOTO: RICH BALDWIN
housing costs can be reduced. It’s not that simple, though. Approximately 30% of construction workers are immigrants, so there could be complex implications [if large numbers of undocumented workers are deported].”
Carl Harris, chair of the National
Association of Homebuilders, said in a February 1, 2025, statement: “Tariffs on lumber and other building materials increase the cost of construction and discourage new development, and consumers end up paying for the tariffs in the form of higher home prices.”
In early March 2025, the Trump administration imposed the threatened 25% tariff on Canadian wood imports but several days later postponed enforcement until April. Higher taxes on Canadian OSB would adversely impact foreign producers while raising home prices for US consumers. Housing demand remains unsatisfied.
Nevertheless, political and economic unknowns in early 2025 heighten risks that the North American OSB industry’s good economic results will not continue. The possible entry of four announced, but not started, state-of-the-art mills over the next few years also could eventually lower prices.
national security concern.
Regarding housing, the Republican Party platform for 2024 promised that Republicans will “reduce mortgage rates by slashing inflation” and also will open “limited portions of federal lands” for new home construction. The party’s position is to promote home- ownership through “tax incentives” and “support for first-time buyers” as well as cutting “unnecessary regulations that raise housing costs”. The economics team at Wells Fargo Bank
believes that: “The residential sector is apt to face substantial headwinds this year. New tariff policies will likely increase housing material costs, while tighter immigration policies are expected to slow growth in the construction workforce. Furthermore, elevated new home inventory levels and high mortgage rates are set to remain as obstacles to new construction.” The Trump administration’s immigration policies could put additional strain on the US housing market. John Sim of JPMorgan Chase wrote in a February 10, 2025, research report: “By reducing immigration and lessening demand, Trump argues that
ABOUT THE AUTHORS Richard W (Rich) Baldwin, MBA is
Richard F (Dick) Baldwin,
www.wbpionline.com | April/May 2025 | WBPI
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