Midwest Business Trends

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Business for Softwood lumber providers in the Midwest is strong. It’s just that, for some of them, negative factors are getting in the way.

In Texas, a lumberman said his business is “booming.” He said his market is even better than it was several months ago.

He sells Western Red Cedar and Douglas Fir to lumber dealers, who, in turn, sell that lumber to contractors. “Doug Fir is our best seller,” he noted, “but everything is moving now, and it’s moving at ridiculously high prices.”

He said that he hears from his customers regularly about their level of success. That level is high now, as, he states, “Everybody’s ‘printing money’ right now, it seems like, with these historic high prices.”

This lumber provider stated, “Transportation is negatively affecting our business. Trying to get trucks off the coast has been almost ridiculous. Rail cars are slow-going, too. You’ll have a load hit the reload to get loaded up and it might sit there 2-1/2 weeks waiting for a car.”

In Missouri, “Demand continues to be very strong,” observed one source. “The housing market, like most of the country, is very hot still. The only thing slowing things down would be two factors: labor and lack of supply from producers. However, the supply of lumber is still flowing. Lead times are far out on the orders. Unlike the panel market, you can buy lumber, still. It’s just very expensive and longer lead times.”

Compared to six months before, he observed, “I would say the market is very similar, actually.” 

He sells No. 2 SPF in 2×4 and 2×6, green Doug Fir in 8”, 10” and 12” and in long lengths and Cedar. “In this market,” he stated, “I would say the best seller is green Doug Fir.”

This lumber provider sells his products to pro dealers and big box stores, who report, he says, “very strong demand but not enough supply or labor to meet demands.”

In transporting his lumber, he finds that rail transport is “OK” but trucking is difficult. “These truckers can name their price and their lane. There’s definitely more freight than there are trucks.

“So far, so good,” said an Iowa lumberman, regarding his company’s success-level this year. “Our numbers have been very good. We have blown the budget out of the water. Sales have been excellent.” And, he added, the market for his products has been better of late than it was a few months prior.

He offers engineered wood, Cedar, Pine, Spruce and Redwood to lumberyards and big box stores. He gave an example of his sales: “With one big box store, our business with them has increased tremendously, maybe 10 or 20 percent compared to last year.” He added: “All around, our business has increased.”

He is not experiencing transportation problems. “Actually, I don’t know if it’s because of the area I’m in geographically, but it’s been easy trying to find drivers around here as opposed to other parts of the country. There are a lot of trucks here.”

A South Dakota lumber provider termed his market as, “Expensive.” He expanded on that, to say that high prices for lumber are affecting not only him but also his customers. The supply shortage and the trucking shortage are “the two big hang-ups we’re dealing with now.” In fact, the market is worse than it was six months earlier, he believes.

He offers SPF, Southern Yellow Pine and Douglas Fir to retail lumberyards. “SPF and Hem Fir are probably the species we sell the most of,” he noted. 

“If we ask, they will tell us how their sales are going,” he stated. “For the most part, there’s not a lot of conversation about that. I think it’s busy for them. Here again, the whole supply and demand dynamic comes into play: there’s not enough supply for the demand that’s out there right now.”

Transportation, he mentioned, is “a struggle all the way through the pipeline.”

By Paul Miller

Paul Miller President Miller Wood Trade Publications

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