National Hardwood Magazine - October 2014

U.S.A. TRENDS Supplier

U.S.A. TRENDS Supplier news about sales, labor, prices, trends, expansions and inventories SOUTHEAST LAKE STATES WEST COAST NORTHEAST Year-end is getting closer and Hardwood suppliers in the Southeast report positive activity overall. In Arkansas, a source said, “Business has been above average this year. The Red Oak market has softened over the last six months but it’s supply driven and seasonal at this point. Every year around late August and September we experience a slight slow down. Overall there is still a healthy demand right now.” Offering Red and White Oak, Ash, Sap Gum, Hickory and Cypress, the contact said he isn’t having a lot of availability issues. “If the funds are available you can get what you need,” he explained. “There’s competition from flooring manufacturers who have deeper pockets. Primarily they’re only buying No. 2 and 3A Oak, however, they’re buying it log run just to get the lumber, so it’s competitive on both counts; buying and selling.” As for export markets he said, “We market export stock through a third party, primarily an outfit in Mobile, AL. We sell to them and then they export it. According to them their markets are down a little bit. The Europeans take a month-long vacation in August, and as a result the export business is down a little bit. China is a huge market and they have backed off a great deal as well.” Shipping throughout the Southeast and other areas like Texas and Wisconsin, the contact expects the remainder of the year will be good. “The Hardwood market is improving and we’ve seen increases over the last six months,” a supplier in North Carolina mentioned. “The largest factor we’re dealing with right now seems to be supply.” Handling most domestic Hardwood species the sources said, “Most species are moving As many Lake States Hardwood suppliers prepare for the coming winter, some are already indicating a slow down from the first half of 2014. “We’re doing fairly well, but things have slowed down considerably since the beginning half of the year,” a contact in Michigan commented. When asked about the factors involved he said, “Exports have slowed down, which put more product on the market, but also production seems to have slowed down.” Handling all domestic Hardwoods he said, “Hard and Soft Maple, Red Oak, Hickory and Walnut are still moving, but the others have slowed down. Inventory is down a little and prices seem to have flattened out. It’s possible that things could improve but no one has a crystal ball and there’s just no way to tell.” As for his immediate markets the source noted, “Western Canada is doing pretty good but Eastern Canada has slowed down. China has full warehouses so they’ve backed off buying for the time being.” With transportation in the hot seat for many Hardwood suppliers, the contact said it hasn’t really been a primary concern for his operation. “Our three main customer bases are cabinet and flooring manufacturers and distribution yards. Flooring is pretty strong and the others are staying fairly busy,” he said. Looking ahead at what remains in 2014, he said, “At the end of the year we’ll have that answer, but right now everyone is sort of scratching their head and hoping the market stays steady.” In Indiana, a contact said, “Business is definitely down a Random hot spots in Hardwood activity have West Coast suppliers accounting for mixed business conditions. In California a contact said, “Some people are busy and some people are just slow. Furniture manufacturers are slow. People just aren’t spending money. In different areas of the country, there are different problems.” Primarily handling Poplar and Alder he said, “Alder shortages are a problem but Poplar is doing okay. Our inventories are normal for this time of year. Prices have been inching up some on everything. There will probably be more Poplar and Alder on the market in the next few months, so that will improve things. We don’t directly import, but through the companies that handle that for us we’ve heard that the Beech market has been pretty tight.” He continued, “Trucking availability is an issue. For a while it was difficult to get containers. Now that issue has loosened up and a new one has started.” Marketing mostly to hospitality furniture manufacturers he indicated his customers markets are steady. “Comments from the hospitality furniture manufacturers are that business is good. It’s the home furnishings area that is suffering.” As for his outlook on the remainder of 2015, he said, “Through the end of the year I would say things will stay steady.” “Business is a little slow at the moment,” a contact in Washington mentioned. “It happens every year and I don’t anticipate that it will last very long. I think project planning is going on right now and most of it is interior versus exterior. When the weather gets a little colder, more of the products we provide for the cabi- Diving into the fourth and final quarter of 2014, Hardwood activity in the Northeast is stable. “Out of a hundred percent, business is at about fifty right now,” a contact in New York, commented. “It’s not really good and it’s not really bad.” When asked about the factors involved he said, “China is the major factor for us and they have backed off at the moment.” Handling mostly Red and White Oak, he said availability isn’t an issue. “Our inventory levels are as good as we can expect for this time of year. Prices are down on everything. I do see an improvement coming in the next 90 days.” He continued, “China is the main player, so all markets reflect theirs. Canada is slow and like most of us—holding steady.” As for transportation he said, “We really haven’t had any trucking issues like many others are experiencing. But we’ve been doing business with the same trucking companies for many years.” Serving mostly distribution yards and manufacturers he said, “I look forward to an improvement in the fall and the end of the year.” A Hardwood supplier in Maine offered, “Pricing is firm. We’re busy, but margins are disappearing. China is off, which means that we’re stocking up on Red Oak. I think that’s deliberate on their part, to get the prices dropped. Weather is also a factor. We’ve seen a little extra production on Red Oak simply because that’s what the mills have to cut. Our weather here has been so wet that my mills, which normally run seven logging crews, are down to one. Then the lumber we’re bringing in has to be processed so fast Please turn to page 70 Please turn to page 70 Please turn to page 71 Please turn to page 71 14 OCTOBER 2014 ■ NATIONAL HARDWOOD MAGAZINE

OCTOBER 2014 ■ NATIONAL HARDWOOD MAGAZINE 15