Inland West Business Trends

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Lumbermen in the Inland West have reported that demand for their lumber is high, supply is low, and their work life is very busy. 

In Montana a remanufacturer said, “Product is in short supply, and demand is high, the same as everywhere else. I’m mostly speaking from a boards-standpoint; that’s primarily what I’m buying. Depending on the day, published reports don’t really do justice to what the market is doing. Most mills are quoting published reports plus a certain dollar amount added. We buy directly from sawmills and turn it into something here. We are paying over published reports, and, with higher transportation prices, our cost is $100 over what the market’s at for 1,000 board feet. We pay more and charge our customers more, so increased costs get kicked down the chain.”

Asked about the state of his business compared to a few months ago, he replied, “As far as order files, it’s the best it’s ever been. But as far as relationships go with mills and customers, tensions have been high. So, it’s kind of a mixed world. The sales are off the charts. But getting material is the hard part. So, mill-to-customer relationships are on high tension.”

This remanufacturer handles No. 3 Common, No. 3 and Better, No. 2 Common and No. 2 and Better in the Douglas Fir, Engelmann Spruce, Lodgepole Pine and Ponderosa Pine boards he buys. In dimension, he buys No. 2 and Better 2×4 through 2×12 and Select Struct grade for Douglas Fir and SPF. Products range from 1×2 to 1×12 and from 2×2 to 2×12.

His sales are mostly to retail lumber yards and wholesalers. His customers, he noted, are in the “same boat” as his company is: high demand and low supply. Asked about tension between his company and his customers, he stated, “It depends on the salesperson you’re dealing with and who their client-base is. I would definitely say there’s some tension going there, as people are trying to fulfill order files.”

He commented that his firm’s biggest difficulty at this time is “a little bit of labor issues, finding people who will show up to work every day. We’ve had some battles with that. Trucking availability also has been difficult.”

An Arizona lumber provider said his work environment is “extremely busy.” Compared with six months earlier, he stated, his market was “pretty much the same, honestly.” When asked if he has high demand and low supply, he laughed and said, “That is very true, yes. Trying to keep supply in is a challenge.”

He handles 2×4 and 2×6, No. 2 Spruce, 2×4 and 2×6 No. 2 Inland White Fir and 2×6 through 2×12 Green Doug Fir.

He sells to retail lumber yards. “Everybody is extremely busy,” he said of his customers. “Everyone, like us, is struggling to get product. It’s really busy. Nobody’s buying anything unless they need to have it, and when they need to have it, they need to have it tomorrow. Because lumber is so expensive, nobody’s stepping out to buy anything they don’t need. However, everybody needs lots of lumber, so they’re pretty well buying every day.”

He said, “Trucking is horrible. It’s extremely hard to get anyone to haul a load. And trucking is approximately four times more expensive than it was a year ago.”

A source in Idaho observed that his market is “strong. It’s not what it was several months ago, but sales are strong.” Looking back a few months, he said, “Sales were in a frenzy. I guess that’s the word I’d use. Out of the last 16 months, I would say 12 were volumes no one had seen in their careers. Now our market has kind of moderated to a 2019-normal. It’s strong. It’s as busy as it was in 2019, but it’s not like 2020.”

He handles Ponderosa Pine and Cedar in No. 2 and No. 3. His sales are primarily to big box stores, which are prospering. “Home centers are really, really busy,” he stated.

Increased freight rates are a problem, he noted. However, “We seem to eventually be able to find the trucks we need. We’re not shipping much by train now. The vast majority of our shipments are by truck. You can cover your needs; you’re just going to pay more for it. 

By Terry Miller

Editor, Marketing Consultant, and Third generation publisher. With Miller Wood Trade Publications since 1983.

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