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Page 28
West Coast
Business Trends
Continued from page 27
Right now there are no inventories
except at some sawmills. Western Red
Cedar logs are very tight and they are
very high priced. Our company is very
busy. Our industrial sales on white wood
are way off. We are selling a fair amount
of Cedar. It is our good fortune to be in
many of the right niches. Our information
indicates buying of wood products is
off in California by 45 percent. In Texas
it’s off by 20 percent and the northeast is
spotty.”
Karen Quibell, in sales for Douglas
County Forest Products, Winchester,
Ore., said, “Right now supply and
demand seem to be lining up for our
products (framing, posts, timbers,
beams, stringers, studs and truss stock).
A lot of production has been curtailed.
Our log prices don’t support $250 wood.
Log prices have been high and there is
lots of pressure on logs from chips. Our
log supply is minimal, just enough to
keep the mill running because prices are
too high to build inventory. We’re cutting
Douglas Fir, Hem-Fir, White Fir and
Lodge Pole Pine. There was a little
‘burp’ this week partly due to a Canadian
Rail Strike (still on April 13th). It is troubling
to see more and more consolidation
in our western mills.”
Jim Weber, general manager for
Cascade Structural Laminators,
Eugene, Ore., said, “We produce glulam
beams. Some markets are okay with
sales brisk and others are dead. Some
of it is economy related. Housing is off
about 37 percent now from the last few
years. Some of it is weather related. Our
sales are off maybe three percent. Our
size enables us to tailor our product to
meet market needs. As the residential
market declined, we raised our custom
beam business.”
Brian Jones, with Zip-O-Log Mills,
Eugene, Ore., said, “We are a little slower
in April than we were in March.
However with the closing last Friday of a
large timber producing mill, we are confident
we will see additional sales from
the customers that mill was serving.
The market is sluggish overall right now.
Framing lumber and plywood have been
slow.”
Darren Duchi, sales manager for
Siskiyou Forest Products, a remanufacturer
in Anderson, Calif., said, “The supply
on Cedar is getting tougher and
tougher over the past six months. The
supply on Redwood is okay and we
have all we need. On the demand side
we have a good order file, however
there is no sense of urgency. I feel a
slowing is needed and has been a long
time coming. We anticipated the slowdown
in the economy 10 to 12 months
back. Right now there is a lot of wood
coming into the U.S. from offshore. I
made a trip to Baltimore last week to
visit customers and while there I saw
framing lumber in their yard coming from
Germany. Here we have oodles of framing
stock made in this country and our
customer is buying it from Germany; It
blew me away! We feel bigger is not
necessarily better and we feel that our
smaller size is an advantage, helping us
be very flexible. Our focus is on high
quality products from clear material.
Our customers demand quality and are
not willing to risk quality or late deliveries
coming from some place like China.”
•
Midwest
Business Trends
Continued from page 9
ably.”
The fact is that some markets were
already declining during the two-year
boom period of 2004 and 2005, which
produced fewer starts than the benchmark
five-year average. Economists
now attribute the unsustainable levels of
excess demand to “historically low interest
rates coupled with aggressive lending
practices,” a combination that made
home ownership more affordable and
also attracted investors and speculators
The Wonders
Of Growing Up
In Maine.
For the Eastern White Pine, growing up in Maine
is an extreme challenge. Short growing seasons,
rich but shallow, rocky soils, and
winters that arrive early and stay late
– but this harsh environment creates
a spectacular pine. A tight grain and unmatched
fiber structure give each board an exceptional
workability – perfect for the most intricate millwork.
In addition to its natural beauty and pale color,
Eastern White Pine is the least resinous of all
pines, with a stability that ensures minimal
shrinkage and swelling. Tall and straight, Eastern
White Pine has always been the secret behind
Hancock Lumber’s success and our customers’
continued satisfaction.
For more information on Eastern White Pine
from Hancock Lumber, call 207-627-7600.
TM
WE MAKE IT EASIER.
www.hancocklumber.com
*Hancock Lumber’s use of the indicates that they are a participant in
the SFI ® program in good standing and that Hancock Lumber’s operations have
been certified to be in compliance with the SFI Standard (SFIS) and guidelines
by an independent auditor. For more detailed information on the SFI program
and the standards and guidelines, please visit, www.aboutsfi.org.
The Softwood Forest Products Buyer
in many markets.
According to the NAHB spokesman,
“the Midwest has fared the worst in this
cycle, posting the lowest gain during the
boom, only 116 percent, before falling to
68 percent of pre-boom production.”
The strongest growth in this region has
been reported in Texas, which accounts
for roughly 75 percent of the Midwest’s
southern division’s housing starts. In
fact, Texas has managed the highest
level of production throughout the ongoing
housing market correction.
Specifically, Houston has experienced
only a modest decline in production in
the past six months, and shows signs of
fulfilling the NAHB’s prediction that the
city would also experience a quick return
to steady growth in 2007. That growth is
forecast to escalate as the year progresses.
Dallas showed telltale signs of overheating
in regard to new home inventory
and home values as 2006 turned into
2007. In fact, the city peaked an annual
single-family production rate of 57,000
units, compared to an average of 38,000
in the preceding five years. NAHB predicts
that the Dallas market will recover
at an annual pace of 45,000 by the end
of 2007 and then rise in 2008. Austin
and San Antonio also edged close to
over-heating and reached 145 percent
of pre-boom demand in 2005 before
declining sharply. The NAHB predicts
that Austin’s market will bottom out at
2004 levels by end of 2007. San
Antonio, however, has already bottomed
out at those levels and is reportedly
poised for significant growth during the
remainder of this year and into 2008.
The uppermost regions of the Midwest
are expected to remain stagnant with
minimal growth in occurring in 2008.
However, states in the central portion of
the region are better poised to stabilize
in 2007. In fact, the housing markets in
St. Louis, Mo. and Kansas City, Kan.,
are expected to rebound nicely in 2008,
according to the NAHB report, based on
improvements in the economic conditions
in those cities.
ALL-COAST -
Continued from page 13
•
All-Coast also mills every pattern in the
books published by the Western Wood
Products Assoc., the California
Redwood Assoc. and the Western Red
Cedar Lumber Assoc.
“Virtually any pattern or profile that anybody
could possibly need can be handled
by us,” Bond said. “We can custom
mill a pattern within 48 hours, often
times sooner and deliver it on the next
scheduled truck.”
He continued, “We treat our suppliers
as partners. We want a supplier partnership,
not just a vendor or another mill.
Some may be manufacturing a product
and they want us to go figure out how to
market it—that is not what we want. We
are in it together and it must be mutually
beneficial to all involved and for long
term to create value.”
That same philosophy spills over into
the customer side of business. There is
a three-prong approach to the sales
effort at All-Coast.
“There are three different categories
that make up our sales team,” he said.
“Our outside sales people are responsible
for their accounts and they visit
those accounts on a regular basis.
There are inside sales people who back
up those outside sales people. They
have relationships with everybody in
every territory. Then we have builder
specialists who contact architects and
builders and handle promotional work in
the field. However, we do not sell directly
to them. We only sell to retailers,
mass merchandisers, or jobbers and
some industrial accounts.”
The concept of a builder specialist is to
create markets and build brand—basically
pull product through the supply
chain, Bond explained.
“It has a specific focus and that is for
brands within All-Coast’s control,
whether it’s an internal brand or external
brand that we control exclusively,” Bond
Continued on page 46