Canfor is not abandoning its traditional U.S. customers for China, but the days of being "overly dependent" on the American housing construction market for business are gone, Chief Executive Jim Shepard said.
"We're moving into a new world as far as lumber is concerned' ... It's going to be serving the American market, Chinese market and Asian market. It's a different dynamic," Shepard told analysts.
Canadian lumber sales to China have surged over the past year, but Shepard said it was too early to say how much of its production will be divided between the North American and Chinese markets.
"Right now up to 30 percent of our market is going into China, and who knows it could be a little bit more of that going into the future," Shepard said.
Canfor credited sales to China with offsetting weak demand in the United States when it reported a C$30.7 million profit in the fourth quarter.
The company credits the increasing Chinese demand on a growing acceptance of wood as an alternative construction material to concrete or steel by consumers, which has led to changes in Chinese building codes.
Canfor estimated that it would sell about 800 million board feet of lumber to China in 2011.
Canfor was one of the first Canadian producers to enter the Chinese market, and the executive who helped lead the company in that direction was named on Friday to be its next chief executive.
Don Kayne, a 32-year veteran of Canfor who is currently its vice president for wood products marketing, will replace Shepard when he retires in May. (Reuters)
