Weyerhaeuser to build new Arkansas TimberStrand facility

Weyerhaeuser Company is planning to invest approximately $500 million in the construction of a new, state-of-the-art TimberStrand facility near Monticello and Warren, AR.

This expansion will increase the company’s capacity for engineered timber products in the southern region of the United States.

The facility will have an annual production capacity of approximately 10 million cubic feet, which is comparable to the company’s current TimberStrand facility in Kenora, Ontario.

Construction is anticipated to commence in 2025, with the objective of commencing operations in 2027.

The new facility will serve an expanding and underserved market for TimberStrand in the southern United States and will demonstrate Weyerhaeuser’s innovation in wood products.

The company is utilizing its proprietary TimberStrand technology to manufacture TimberStrand with southern yellow pine as the principal feedstock.

This process involves combining institutional expertise from Kenora with extensive research and development.

The Monticello facility is strategically situated to source the majority of its fiber log requirements from Weyerhaeuser timberlands in the region, given the company’s substantial forestry holdings in Arkansas.

Furthermore, the plant will incorporate a biomass-fueled cogeneration system that will provide the plant with its entire electrical requirements and substantially reduce its environmental impact.

The new facility’s primary characteristics include:

• Enhances Weyerhaeuser’s EWP offerings in the U.S. South and doubles the company’s North American TimberStrand capacity
• Provides seamless integration with the current distribution network of Weyerhaeuser timberlands and wood products, as well as with the readily available rail and freight transportation in the region.
• At full operating capacity, it is anticipated that the company will generate over $100 million in annual Adjusted EBITDA, with an additional benefit from portfolio integration.
• Supports the company’s robust and expanding customer base in the region, as well as the growing demand for TimberStrand® in industrial and residential applications.
• Improves the company’s product line for the bulk timber market as it continues to develop and expand
• In accordance with the organization’s long-term sustainability objectives and objectives for the reduction of greenhouse gas emissions
• Once fully operational, it is anticipated that nearly 200 high-quality employment will be added to Monticello and the surrounding area.
• Adds a third manufacturing facility to the company’s total investment and impact in Arkansas, in addition to a lumber mill in Dierks and a plywood and veneer plant in Emerson. Additionally, the company operates a seedling nursery, several offices, and 1.2 million acres of timberlands. The company currently employs over 700 individuals throughout the state.

“This is an exciting opportunity to grow our EWP business, expand TimberStrand into the U.S. South and provide an additional outlet for our fiber logs in Arkansas,” Devin W. Stockfish, the president and CEO, stated.

“Of the wood products we produce, EWP has the strongest tie to single-family housing construction activity, and this new facility aligns with our conviction that U.S. housing demand will remain favorable over the long term. In addition, this plant will allow Weyerhaeuser to better serve other customers and end markets in the region, including mass timber applications, and it supports our broader sustainability ambitions. I’d like to thank the state of Arkansas and local officials for working with Weyerhaeuser to site this facility. We look forward to building on our long history in the state and providing new employment opportunities in Monticello and surrounding communities.”

The company anticipates that the facility will require approximately $500 million in capital expenditures by 2027.

However, it intends to exclude this investment from the calculation of its annual Adjusted Funds Available for Distribution, which is utilized in its flexible cash return framework.

The company may source this capital outlay from cash on hand or through future financing, as it deems appropriate.