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QUEBEC Although some
QUEBEC Although some contacts feel that the marketplace is better positioned with supply than last year, the development of green and kiln dried stock for Ash is not excessive. The increased availability has stabilized prices and reduced the pressure. Birch is reported as being static, with demand keeping pace with developing supplies. Prices are stable for unselected Yellow Birch. Higher prices are obtained for material sorted for color and length. Whatever is left over is hard to move comment contacts, and are very price sensitive. Market reports for the regionally important species Hard Maple are weaker. The improved production since the later part of the summer supported supplies, causing increased sales competition. Wholesalers were particularly cautious with their inventory. Upper grades are experiencing more pressure than the common grades. Prices have edged downward for green FAS and Select, Unselected, kiln dried Number 1 and 2 White and Unselected categories of this species. The core business for Soft Maple, which involves secondary manufacturers, is reported as keeping its foothold on volumes and prices, but the demand for the species is weak, comment contacts. Production is restricted to quantities that are seen as sellable. There is competition from other species and from the various regions that have prevented an oversupply for Soft Maple. Although the demand for White Oak has eased off since last year, there is sufficient demand to meet the existing production, causing stability of prices for green and kiln dried stocks. The seasonally adjusted annual rate of housing starts was 167,900 units in October 2010, according to Canada Mortgage and Housing Corporation (CMHC). This is down from 185,000units in September. “Housing starts moved lower in October due to a decrease in urban single starts in all regions, with the exception of Atlantic Canada,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “Both single-detached and multiple starts decreased in October.” This moderation in housing starts, from relatively high levels earlier in 2010 is consistent with CMHC’s 2010 forecast of 184,900 units. For 2011, housing starts will gradually become more closely aligned with demographic demand, which is currently estimated at about 175,000 units per year. The seasonally adjusted annual rate of urban starts decreased by 12.3percent to 142,400 units in October 2010. Urban multiple starts moderated by 15percent at 84,700 units, while single urban starts moved lower by 8 percent to 57,700 units. The seasonally adjusted annual rate of urban starts decreased by 24.5percent in Ontario and 2.6percent in Quebec. Rural starts were estimated at a seasonally adjusted annual rate of 25,500 units in October 2010. The slow North American recovery will chug along over the next two years, says the Paris-based Organization for Economic Co-operation and News from suppliers about prices, trends, sales and inventories. ONTARIO It is reported that in some regions, discussions recently continued to surround the improved supply situation. Some sawmills reported increased production, which bolstered inventories, and, at sustained rates, was meeting the needs of the market for most items. Sales competition continues to grow, and there is still a controlled approach to purchasing which has been ongoing since early in the year. The winter months are upon us and some of these increased production volumes may be used to fill orders caused by weather-related disruptions during this time. Activity surrounding the upper grades of key species are more difficult to move than the common grades. Hard Maple reports continue to describe the marketplace for this species as competitive for the upper grades, and stable for the common grades. Sales for various species are reported to vary by region contacted, as not all species and grades are selling the same in each region. The mix also includes varying prices for the products, with some stable while others show signs of pressure. There is limited interest in Soft Maple commented some contacts, with competition from the U.S. border states adding pressure to the issue of supply for this species. Even though lower price incentives are offered, it doesn’t boost the demand. However, flooring producers reported having no trouble finding adequate supplies of this species. The supply of Red Oak in both Canada and the U.S. has improved with confidence being expressed that production will remain consistent now that the timber-to-lumber process is up and running. With product availability, prices have levelled off, although the surplus supplies developed for certain items fuelled sales competition and price pressures. Several contacts commented they would rather have Red Oak on hand rather than Hard Maple as it is a better seller to export markets. Supply and sales of White Oak were also reported as improved, with prices having stabilized, and having moderated for specific grades and thicknesses. Supply and demand for Ash are closely matched at this time. Sales of Ash have been reported going to flooring producers. On the other hand, Aspen is experiencing stiff competition from other species thus disrupting business for this species. Basswood supplies were reduced ahead of the expected rise in winter sawmill production. This species is also experiencing sales competition from the various regions and other species, as well as challenging business conditions. Some sawmills have cut down or stopped purchasing logs from the U.S., thus leaving the U.S. with more supplies. A Canadian mill announced recently its indefinite shutdown due to market conditions, and several others were reported considering an indefinite shutdown over the next several months. It is a quieter time due to the Holiday season, but business has not improved much in the past 6 months said some contacts. Please turn to page 57 Please turn to page 57 8 Hardwoods Have Workability
