Domtar Cuts 100 MMBF: What It Means for Q4 Pricing

Impact on Your Procurement Strategy

Domtar’s decision to temporarily curtail all North American lumber production is a classic supply-side reaction to persistent demand weakness. The removal of 100 million board feet (MMBF) from the Q4 supply pool—which includes holiday downtime—is a substantial volume cut that immediately impacts market psychology. The goal, explicitly stated by Domtar Wood Products President Luc Thériault, is to address "challenging market conditions" and "stagnant demand," signaling that pricing has likely fallen below the cost structure of many large producers.

For procurement managers, the immediate takeaway is that the market slide has likely hit a temporary floor. If you were holding out for a deeper price collapse through December, this curtailment significantly mitigates that possibility. Instead of seeing prices continue to erode by $5-$10 per thousand board feet (MBF) weekly, we should see stabilization or even a minor firming trend—a 'dead cat bounce'—as brokers and distributors rush to secure material that was suddenly removed from the open market. This curtailment affects Canadian SPF (Quebec and Ontario operations) and potentially some US-sourced dimensional lumber, tightening specific regional supply chains.

From a supply perspective, lead times are not expected to lengthen dramatically, but the flexibility and ease of finding quick-ship loads will diminish. Buyers should prioritize securing their essential Q4 fill-in inventory and cover the first 30-45 days of Q1 needs now. The risk of paying slightly higher prices today to secure supply is lower than the risk of waiting until January and facing stabilized prices coupled with increased volatility if other mills follow suit with similar holiday curtailment extensions. This timing window—mid-December—is critical for locking in winter pricing.

Strategically, this move doesn't fix the underlying demand problem, which Domtar confirms is still "stagnant." Therefore, while we expect short-term pricing stability (STABLE), procurement should remain cautious about building excessive inventory for late Q1 or Q2. The focus must be on tactical buying: use the current stabilized price point to balance inventory and ensure coverage for early 2026 projects. Monitor competitor responses; if other key producers announce similar capacity reductions beyond the standard holiday break, the 100 MMBF curtailment could signal a broader, sustained effort to boost prices, justifying a slightly more aggressive purchasing strategy for Q1.

Key Takeaways

• The removal of 100 MMBF establishes a short-term price floor. Stop waiting for a deeper price collapse; cover immediate Q4/early Q1 needs before mid-December.

• Expect pricing to shift from soft to STABLE through the holidays. Focus purchasing on Eastern SPF and standard construction dimensions (2x4, 2x6) where supply will tighten most.

• Do not over-buy for Q2. While supply is tightening, underlying demand remains weak. Maintain lean inventory levels for Q1 and re-evaluate strategy based on January housing starts data.

• Monitor competitor mill announcements closely. If other major producers extend holiday downtime, the market will firm up rapidly, requiring quicker purchasing decisions.

Market Outlook

Pricing Trend: STABLE

Confidence Level: MEDIUM

Recommended Action: Cover immediate demand and critical Q1 inventory needs now. Domtar’s 100 MMBF cut establishes a price floor; expect short-term volatility. Delaying purchases past mid-December risks paying a premium on stabilized winter pricing.

How LumberFlow Helps

As the market stabilizes due to this curtailment, use LumberFlow's automated price alerts to track immediate market reactions and ensure you are not caught off guard by short-term price spikes. Use our multi-supplier RFQ system to quickly compare offers and secure the best pricing before the supply reduction fully manifests in the secondary market.

Ready to stay ahead of market trends? Book a consultation with our team to see how LumberFlow's procurement platform transforms dimensional lumber buying.