National Hardwood Magazine - February 2011

Supplier news about

Supplier news about sales, labor, prices, trends, expansions and inventories. SOUTHEAST LAKE STATES WEST COAST Hardwood lumber buyers in the Southeast report full inventories and plenty of available lumber on the market. A Georgia Hardwood flooring manufacturer said, “We’re getting plenty of lumber offered to us and we’re cutting back on some of the suppliers, weeding out the marginal ones and keeping the good ones. We’re in a traditionally slow season so right now we’re not seeing a lot of activity on outbound materials.” Purchasing primarily 4/4 No. 2 and 3 Common Oak, the contact said conditions on the supply side are better but weather is factoring in. “Cold weather is affecting some of our supplier mills. Some of them that normally start up at 7 a.m. are telling me that they can’t get things ironed out until about noon as far as getting the equipment up and running in extreme temperatures.” Marketing to flooring distributors and pallet and crate manufacturers he said his customers account for mixed activity. “A few of them are experiencing a seasonal slow down and others are actually gaining business. I am seeing more products out there as far as competition. Especially with Poplar prices Hardwood suppliers in the Lake States region report moderate to improved conditions. A source in Michigan said business conditions are fair to good compared with 90 days prior. Supplying Northern Red Oak, Hard and Soft Maple, Beech, Birch and Aspen, the contact said Oak is his fastest moving product and Hard Maple is his slowest. However he did say that log prices are competitive in his local area. “Logs are still competitive with pricing here in Michigan. There are still a lot of buyer’s bidding high prices for timber sales.” He also said a shortage in the availability of trucks and fuel costs are up about five percent. For the coming months in 2011, the contact has a positive outlook. “I think we’re going to see more activity after spring comes. There are a lot of people sitting on cash. We’re one of them. We don’t want to invest in equipment yet until we see where the economy is going to go. I know that while we’re being cautious, others are too, but people have to live somewhere.” In Wisconsin a Hardwood supplier described his market conditions as “a continuous battle.” He Please turn to page 52 Please turn to page 53 Some sources on the West Coast report moderate improvements in lumber markets and others account for stagnant activity. A Hardwood distributor in California said business conditions are about the same as the last few months of 2010. Handling all domestic Hardwood species, he said Walnut is moving the best and Poplar is his slowest moving product. “Availability is excellent but our inventory levels are off by 20 percent,” he explained. “Inventories are in check with where demand is but again, we’re just not seeing any business.” The contact said Forest Stewardship Council (FSC) certified products, had been doing well, “but now that commercial activity slowed down, those products are an added expense for us with no profit. About 98 percent of those sales were with the commercial market.” For the coming months he doesn’t expect many changes. “We’re bracing for the worst and hoping for the best.” Another Hardwood supplier in California said his sales activity has not changed much in the last 90 days. “We’ve been holding steady but there haven’t been any Please turn to page 54 NORTHEAST Hardwood lumber suppliers in the Northeast region report depressed market conditions with lack of demand as the primary factor. A source in Pennsylvania said, “Business conditions are off by more than 60 percent for our operation. People are not interested in building new homes and purchasing new products today because they don’t know if they will have a job to pay for them tomorrow.” With more than 60 percent of his production in Cherry, the contact said it is an especially difficult species to market due to the cost. “Cherry is a very expensive species in a normal market. So with the lack of demand, we are facing difficult times.” He said while he isn’t having any trouble finding the material that he needs, the price of timber is high and the price of lumber is low. “We’re only purchasing what we can sell, so if we cannot sell it we try to avoid it,” he explained. The contact said in order to adjust to these conditions, his company has had to cut operating, labor and management costs. “The name of the game is to try to cut where you can. We are down to a staff of 27; we cut the Please turn to page 54 6 Hardwoods...A Renewable Resource

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