Weaker lumber prices and US duties on Canadian softwood lumber exports took their toll on forest product companies Weyerhaeuser and Abitibi-Consolidated in the third quarter. However, both companies signalled a better outlook for some paper products. Weyerhaeuser - based in the US but with extensive Canadian interests - saw net earnings for the quarter fall 86 per cent to $13m. Countervailing and anti-dumping duties totalled $31m for the quarter and are expected to hit $65m-$70m for the full year. The company said fourth quarter earnings were expected to be higher than the third quarter due to improving demand and recent price increases. "As we look to the fourth quarter, we see some modest improvement in the paper and containerboard businesses, and our real estate business is maintaining a strong backlog of sold, but undelivered houses," said chief executive Steven Rogel. However, wood product markets "continued to be a concern", Mr Rogel said. Montreal-based Abitibi returned to the black in the third quarter with net earnings of C$77m (USDollars 49m), up from a year-ago loss of C$83m. However, operating income from continuing businesses fell to C$29m from C$207m last time. The net figure was inflated by a C$304m net gain on the spin-off of 75 per cent of a Quebec pulp mill, and a C$25m favourable tax adjustment, partly offset by a C$192m foreign exchange loss. Abitibi said higher waste paper costs in the quarter were offset by improved volumes in both newsprint and value-added paper grades, as well as a USDollars 50 a ton newsprint price increase imposed on August 1. The increase was the first positive newsprint pricing movement in more than 18 months. Weyerhaeuser said it was making "excellent progress in capturing the synergies" from its $6.2bn acquisition of rival Willamette Industries and taking other measures to drive down overheads. The quarter saw an $11m charge from the Willamette takeover and a $20m charge related to a boiler explosion at a North Carolina mill. Weyerhaeuser shares were down just 3 per cent at $46.24 in lunchtime New York trading, while Abitibi was also off more than 3 per cent at C$10.80 in Toronto.