Industry Survey
Industry Survey Continued Parker Boles Hermitage Hardwood Lumber Sales, Inc. Cookeville, TN The export lumber market for our company so far in 2020 has been equal to or better than the second half of 2019. We have not seen an aggressive increase in demand, but more a lack of supply in certain items fueling more inquiries. (Shortages are developing due to competition from other markets, weather-related logging slowdowns, timber sales being somewhat limited and sawmills limiting the amount of timber/logs they want to pur- Parker Boles chase.) We never had much opportunity to get business going after the Chinese New Year because China immediately began dealing with the COVID-19 virus. We are hearing mixed reactions about the tariff removal. Although the tariffs were of varying amounts, we seem to be able to ask for price improvements, but not able to get all the tariff percentages returned to lumber values in our attempts to take orders at prices that will make some profit. The coronavirus has definitely affected our export and domestic business. Some countries are almost at a complete shutdown and we are expecting others (including the United States) to sustain a grave effect on deliveries and new orders. We hopefully will see some improvements as warmer weather arrives, but the Centers for Disease Control doesn’t fully understand this virus and whether it will behave like other viruses. We are not sure what measures the U.S. government will adopt that may curtail workplace assemblies and regulations, but we cannot produce lumber from the sanctuary of our individual homes. We have been experiencing some added inquiries about Ash, upper-grade Red and White Oak, and Walnut. Most other species are still somewhat stagnant at best. Now that prices have fallen to levels that will not support aggressive timber procurement, we hope to have witnessed a bottom or near bottom to the values of the inventory we currently have in stock. At least we have a better idea of what the values should be. o Curtis Struyk TMX Shipping Co. Inc. Morehead City, NC The year started with 0 to 0 rate increases from ocean carriers per 40-foot container. However, when the Chinese tariffs were lifted, we saw an immediate increase in demand for log and lumber exports. Although the demand was present, vessel space remained tight due to blank sailings. We had high hopes of seeing volumes return Curtis Struyk to 2017 levels, but current lack of equipment at inland depots and shortage of vessel space has limited our throughput. The biggest impact of coronavirus from an export perspective has been the increase in blank sailings around the world. Due to the coronavirus hitting China at the beginning of the year, the Chinese New Year holiday was extended from late January to early February causing a delay in people returning to work. This caused a chain reaction and created an influx of blank sailings, making it particularly hard to find vessel space. In addition, temporary closures of many brick-and-mortar retailers in the United States have slowed inventory turnover, resulting in full warehouses and less import demand. We expect 40-foot equipment shortages to continue at inland depots and some ports, particularly Boston and Baltimore, until America is open for business again. It is no surprise that carrier rate increases come with high demand and limited supply. We expect to see additional increases of 0 to 0 per container in May and possibly June. On a positive note, we are grateful that the Department of Homeland Security deemed the forest products industry, and those that support them, necessary and essential during this time of crisis. At TMX Shipping, we continue to provide support to our customers by forecasting their future export needs, securing advanced bookings and spreading those bookings among several carriers to cover demand. Although 2020 has had its challenges, we are hopeful that the increase we saw in exports at the beginning of the year will continue into Q2.o 26 JUNE 2020 n NATIONAL HARDWOOD MAGAZINE
Chris Bingaman Bingaman & Son Lumber, Inc. Kreamer, PA Darrell Orrell Maxwell Hardwood Flooring Monticello, AR Maxwell Hardwood Flooring is open and running in compliance with state guidelines. We have multiple hand-washing stations, are practicing social distancing, are sanitizing daily and have told sick employees to stay home. Employee attendance has been excellent. The consensus among our distributors has been that contractors are finishing up jobs Darrell Orrell that were already in the pipeline. We’ve had a few shipments delayed, but most of our distributors remain open. They have closed their showrooms, are loading materials out of their warehouses and still making deliveries when required. Most of them are expecting a dip in business next month, but once the COVID-19 outbreak is over we all expect to see a surge in business and production. o I haven’t seen many changes in the export lumber business so far this year, though most of my orders/shipments to Europe have been put on hold because of the coronavirus pandemic. We also are still experiencing some shipping issues in regard to recent orders taken from China. Most of our overseas orders are for White Oak. Chris Bingaman We have taken more orders in the last three weeks than we had in the previous three months. However, 60 percent of those orders are logs. To my knowledge, all of our customers are working and have been ordering lumber. However, if the government allows us to continue to operate, I expect there will be a gap in business in three or four weeks since new orders for construction home building have probably been suspended by the virus. o Josh Peachey Eagle Lumber Co. LLC Greensburg, KY We feel optimistic about the export lumber business so far this year. We’re not sure if it is due to the lack of supply or the lifting of Chinese tariffs, but lumber orders and pricing are better. Red Oak and Poplar are in the greatest demand among our Josh Peachey overseas customers. As of today, the coronavirus has not affected our business with one exception–we had a load of pallets turned back after the driver coughed. o JUNE 2020 n NATIONAL HARDWOOD MAGAZINE 27
