March 11 (Bloomberg) -- Weyerhaeuser Co., West Fraser Timber Co. and other North American lumber producers may benefit as Japan recovers from a tsunami and its strongest earthquake on record, according to Dundee Securities.
“With wood construction significantly more earthquake-resistant than concrete, we expect that the majority of the rebuilding to be done using wood as a construction material,” Richard Kelertas, a Montreal-based analyst, said today in a note to clients. “This should have positive impact on most of our North American timber, lumber and building materials stocks.”
Kelertas upgraded International Forest Products Ltd. and Canfor Corp., both based in Vancouver, to “buy” from “neutral” and expects increased demand for wood products to last six to 12 months as rebuilding accelerates.
Hundreds were reported missing after waves as high as 7 meters (23 feet) swept ashore in Japan, according to state broadcaster NHK, which showed footage of flood waters sweeping away buildings and vehicles. Airports were closed and an emergency evacuation order was issued for a nuclear power plant north of Tokyo.
Weyerhaeuser, based in Federal Way, Washington, rose $1.43, or 6.2 percent, to $24.38 at 4:15 p.m. in New York Stock Exchange composite trading. Vancouver-based West Fraser Timber Co., North America’s largest maker of lumber for building construction, climbed C$3.17, or 6.7 percent, to C$50.83 on the Toronto Stock Exchange.
International Forest Products surged 80 cents, or 15 percent, to C$6 in Toronto, the biggest gain since December 2008, while Canfor advanced 88 cents, or 7.2 percent to C$13.07.
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