FEDERAL WAY, Wash. (AP) — Weyerhaeuser Co., one of the world's largest lumber and paper producers, said Monday that ''ongoing weak market conditions'' likely will force it to close plants and make other cutbacks in its wood products facilities.
In a Securities and Exchange Commission filing, Weyerhaeuser did not specify what actions it plans to take, only that it likely will have ''to balance supply with demand through closures, curtailment and restricted operating postures'' because of continued weakness in the market for wood products.
The company, based in Federal Way, south of Seattle, recently announced it was selling off two plants: a sawmill in Kamloops, British Columbia, plus associated timber harvesting rights, and a veneer plant in Washington's Grays Harbor County.
Last month, Weyerhaeuser said its second-quarter profits dropped sharply, in part because a drop in single-family home sales and lower housing prices dragged down profit margins.
The company said it expects third-quarter earnings in its real estate and related assets segment to come in lower than in the second quarter, and that ongoing troubles in the housing market will reduce volumes and prices in its timberland segment in the third quarter.
By contrast, Weyerhaeuser said markets for its cellulose fibers and containerboard, packaging and recycling segments are improving.
In May, the company said its board of directors authorized a broad strategic review of the containerboard, packaging and recycling division, and that alternatives included selling it off, continuing to run it or a combination.