hm - Aug13 - cover.indd - National Hardwood Lumber Association

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EXECUTIVE DIRECTOR’S MESSAGE POSITIVE HARDWOOD INDUSTRY NEWS INSPIRES STRATEGIC PLANNING First, the good news; recent industry reports indicate what most of the hardwood lumber industry has experienced first-hand, increased demand and corresponding prices. Markets have increased in all segments including housing, furniture, cabinets, exports and industrial use. In fact, housing is showing a nearly 30 percent increase and flooring shipments have increased more than 20 percent so far this year. Cabinet sales are up more than 15 percent, and exports continue to show improvement by more than 5 percent. In the industrial area, the pallet industry increased its position as the top consumer of hardwoods, while railway ties and crane mats continue steady consumption. Wow! Is this the real recovery And now, the bad news; the industry is not prepared to meet the new increases in demand. For a variety of reasons, the industry as a whole is not able to “gear up” production. Some of the major reasons being log supply, which is so heavily dependent on weather and loggers as well as money issues, as banks are still reeling from the big hits of the past five years which makes for money lending reluctance, especially to an industry such as ours which is hard to predict. Other reasons include labor supply, timber quality and the big one – market uncertainty. So now is the time to do some strategic planning. Like all good strategic planning, company leaders need to begin by coming to a consensus as to their best guess for the future demand of product. Specifically, where will the demand come from, and what product(s) will companies need to produce. For example, with the increase in the industrial use of hardwood, would a mill be best suited to concentrate on low grade production If the Asian market continues to grow, how does a company position itself to benefit from that growing market Where will the demand for upper grades shift if the Europeans lag behind the recovery Strategic planning is really strategic thinking. NHLA will utilize its biennial (every two year) planning session this November to dig down into some of these issues and prepare for those same needs and opportunities. How does NHLA keep the Inspection Service Program modern What will the Inspector Training School look like in the years ahead and how do we increase attendance Is the Annual Convention meeting current but also future needs What changes does the Association staff need to make to better serve the members in general All of these questions and more will be part of the upcoming NHLA strategic planning efforts. Markets have increased in all segments including housing, furniture, cabinets, exports and industrial use. The industry and its associations need to prepare to meet the needs of its customers in the most efficient and effective manner. I will report back on the developments of the Association and I invite you to let us know of your company’s strategic plans so that we may work together to realize the continued growth potential ahead. Sincerely, Mark Barford, CAE, Executive Director National Hardwood Lumber Association www.nhla.com 6 AUGUST 2013 HARDWOOD MATTERS WWW.NHLA.COM
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