CLA Convention Attracts Registrants NAWLA Regionals Attract ...

May/June 2007 Page 9
West Coast
Business Trends
By Wayne Miller
Executive Editor
In mid-April, markets
for commodity
products were
described as slow
or soft by most
suppliers due to
over production of
domestic supplies,
continued supplies
of imported material arriving from offshore,
late winter weather in many parts
of North America, and a slower economy
than the same time last year. Specialty
or niche products fared better; generally
speaking.
In West Bank, B.C., Andy Carr with
Gorman Brothers, a board manufacturer,
said, “Demand for our number two
boards is very high and we are sold out
the next six to eight weeks. One issue
that’s fairly new for us is blue stain that
is showing up more and more from beetle
killed trees. It is getting harder to
keep our log supply free of the blue stain
as more of these killed trees are being
harvested. In April we made a change
in our prices after eight months of no
change. Some pressure came off logs
so we dropped the price of eight inch
and increased the price of the 12-inch
widths. We have an adequate log deck
for this time of year and the quality of our
logs is pretty good. However, by July we
expect that we will see more blue stain
coming in. We can’t avoid blue stain
entirely, but we can pay higher prices
and get more logs without the stain.
Demand is huge for our boards. We get
several calls a day from distributors we
are not currently selling and we have to
turn them away. Our focus remains supplying
our distribution partners that we
have ongoing relationships with. Almost
all of them would like more of our product
than we have to supply.”
Robert Sandive of Haida Forest
Products, Burnaby, B.C., said, “Our
products are all of Cedar and we have a
consistent order file, however we are
short of a number of items due to lack of
Cedar supply. Somehow we have managed
to make up sales dollars from what
we are able to make and what we do
have to sell. Our overall shipments are
actually higher in volume than this time
last year, probably because we have
been in business a long time and have
well-established relationships with our
suppliers. There is no doubt we could
sell more products and volumes if we
could get more supply.
“Also there is a concern about high
prices from end users. Prices seem to
continue upward due to lack of adequate
supplies. Will those ultimate buyers be
willing to continue paying higher prices?
The Cedar supply seems to be always
shrinking. However, our bevel items and
wavy item sales are up about 10 percent
from last year. We are staying busy.
Clears are really tight and we have had
to raise our prices on clear items considerably.
Clear export prices are up by
a third since a year ago. For instance, a
year ago 2x6 No. 2 Clear was at $2,150.
Now it is $3,000, almost a 40 percent
increase. Mills are having a difficult time
as logs continue to go up in price. Mills
have the most capital invested in our
supply.”
Sat Brar with Silver Creek, Matsqui,
B.C., said, “Our Cedar shingle and
shake mill has been shut down for the
last three weeks due to lack of logs. We
talked with our log guy and last week he
said it will be two or three weeks before
Cedar logs start to come out of the
woods. Very few Cedar mills are running
now. We ran consistently until three
weeks ago. It is hard to know what
demand is right now. We are getting
inquiries but we cannot quote. I have
been in Cedar sales for 10 years and I
have never seen this situation before.
Right now we face the highest prices we
have ever seen for Cedar logs.”
Doug Clitheroe, sales manager for
Interfor, Maple Ridge, B.C., said,
“Demand for Cedar was very good
through 2006. We saw the best ship-
ments in 2006 since 1999 in fact. This
year we have a lot of harvest issues and
much of the resulting problems are due
to a tough and long winter causing a
slower start up for Cedar mills. We have
also seen a bad winter in the northeast
which has considerably slowed demand.
So, in my opinion, balance between supply
and demand is not far off. There is
not much inventory in the field or at mill
levels right now. In our own Cedar mills,
we are starting to get some logs in and
our production is gearing up. We expect
more and better production in May and
June. Commodity products are ugly.
Because of this, many wholesale or
wholesale distribution companies are
trying to shift gears and get into Cedar to
improve sales and margins. Those companies
that have not been in the Cedar
market until now are finding it very difficult
to make any inroads in their efforts
to find material. Established suppliers
are focusing on long term customers.”
Dennis Wight, sales manager for
Pacific Western Wood Works Ltd.,
Delta, B.C., said, “Demand for specialty
Cedar products is there. However, the
quality of logs has changed and the percentage
of clear yield is less. We are
seeing Cedar from our supplying mills
free up a bit more—better than two or
three months ago. However, I could
make more money if I had more wood
and better quality Cedar on hand. We
Continued on page 27
Zip-O-Log Mills specializes in carefully
crafted, high-quality timbers available in an
impressive range of stock and custom sizes.
We begin our quest for quality in the forest
where Douglas fir trees are carefully
selected and harvested. Then, each log is
expertly milled by our skilled operators
using specialized equipment.
The resulting timbers are thoroughly
inspected for exceptional appearance
and quality.
Midwest
Business Trends
By Paul Miller Jr.
Assistant
Managing Editor
Price gains for
Ponderosa Pine
and SPF stabilized
in recent weeks as
traders throughout
the Midwest reported
an increase in
interest as buyers
emerged from what the sources referred
to as “the winter blues” when the market
was considerably slower.
The Upper Midwest appears to be the
exception to a market that has shown
gradual improvement. Distributors in the
Upper region have reported a scarcity of
jobs and orders in recent weeks.
Spruce-Pine-Fir (SPF) mill sources
report they struggled in the early weeks
of spring due to sluggish demand as
wintry weather persisted well into April.
This resulted in softened prices of some
species throughout this area of the
Midwest. However Nos. 1 and 2, 2x4
SPF products have remained firm, and
even gained slightly in price as of press
time of this issue of The Softwood
Forest Products Buyer.
From forest to finish
EUGENE, OREGON
541-343-5854
Mill sources reported receiving “modest
to fair” offers on such products as SPF
Nos. 1 and 2, while No. 3 2x4 SPF
prices gained substantial ground by mid-
April. Overall, though, sources categorize
the market as lackluster and spotty,
and all echoed hopes that the summer
months will bring an uptick—however
slight—in activity.
Housing Horizon Projected
Brighter In 2007
When the National Assoc. of Home
Builders (NAHB) recently released a
report outlining exactly which regions of
the country have suffered most during
the “correction” phase of the housing
industry, the Midwest topped the list.
The good news is that the NAHB forecasts
that the worst is nearly behind us;
however, better days are about one year
in the future.
In fact, the NAHB reports that “the
Midwest, which is the hardest hit region
of the country due to some key markets
that have been languishing because of
weak local economies, aren’t likely to
see brighter horizons until next year as
job and income growth gradually
improve.”
The report notes that the correction that
started last year has affected different
markets to different degrees, “but even
markets with signs of over-heating during
the boom have slowed consider-
Plus, Zip-O-Log is adept at handling
your special requirements for kiln drying,
surfacing, and more.
We provide the right lumber specifications
for your building needs, whether in full
units or custom piece counts. And all
orders are packaged, shipped and delivered
on time with the utmost care.
Contact Zip-O-Log today to find out why,
when it comes to high-quality Douglas fir
timbers, we’re simply outstanding.
WWW.ZIPOLOG.COM
Continued on page 28