Hardwood lumber suppliers on the West Coast accounted for stable to stagnant market conditions, at the time of this writing. For most in the region, transportation has been fine but order files for their customers are experiencing a slowdown.
In California, a source said his markets are stable. “Things are okay, it’s not as good as we expected it to be but it’s okay,” he said. “It’s a little worse than last quarter. Interest rates are too high for people who are making home improvements.”
The source said he carries White Oak, Hickory and Walnut, all grades FAS No. 1 and 2.
He said Poplar is currently moving the best. “In domestic hardwoods Basswood and Hickory are both slow movers currently.”
When asked about his customers’ markets, the contact said, “Our primary customer base is lumberyards and woodworking manufacturers. The lumber yards seem a little slower due to inflation and interest rates. Many manufacturers who used to have long backlogs are not seeing as long of files.”
The contact said transportation is good in his area. As for what is ahead he said, “I was talking to one of the local branch managers here and he said they are getting a lot more interest in loan portfolios.
We have other manufacturers out here that invest in equipment. He said there is more interest in financing equipment for these entities which is a positive sign of what is to come.”
An Oregon hardwood supplier said, “The hardwood market is slow but steady. It’s usually slow this time of year but it is a little worse than last quarter.”
The contact, who carries all domestic hardwoods, said, “We carry everything in hardwoods. We carry 4/4, 5/4 and 8/4 lumber. In some of the more popular ones I carry thicker stocks of 8/4 through 16/4. Most of our grades are SAB in Maples and FAS in Walnut. We deal in some No. 1 Common but not as much because our customers are high-end cabinet makers.”
Of the species he carries, he said Alder and Poplar are the best moving items. “We have a lot of species but the exotics are slower than anything.”
He said his customers’ markets are steady. “A lot of our customers have been in business a long time and many of their customers have too. We’re all holding steady.”
Transportation was high on the list of factors affecting his immediate markets. “Pricing for transportation is an issue right now and we don’t look for that to change anytime soon.”
Combined with an election year, another hardwood supplier in California mentioned market uncertainty as a primary factor in the slow activity. “It’s broader than the hardwood market with rising interest rates,” he explained.
“People have put off building and now that there are hints of lowering interest rates, people aren’t in a hurry to borrow money at a higher rate than they would three or four months from now. I believe that is part of what is keeping us suppressed, everyone is in a waiting game.”
The contact carries all domestic hardwoods (FAS, Select and Better, No. 1 and 2 Common, 4/4 through 16/4). He did mention that transportation prices have slightly increased. “Prices have crept up a little bit, but availability of trucks is readily there,” he said. “I wonder if some carriers haven’t taken some trucks off the road because prices have increased. Again, no challenges in availability, just price increases.”
Looking ahead at the next quarter he said, “We can expect some lumber shortages even if demand stays exactly the way it is right now. We’re going to run low on some things. I don’t think there is any region that has an abundance of logs right now.
Most of them are substantially lower than where they like to be at this time, and that’s going to lead to some shortages. Even without increases in demand, the prices are going to go up. White Oak is going to continue to be where it is or a little higher. Hard and Soft Maple and Red Oak will see some increases just based on supply.”
