Midwest Business Trends

Jan/Feb Issue

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It’s either feast or famine for Softwood lumber providers in the Midwest, according to three sources contacted.

An example of famine can be seen in Oklahoma where a lumber provider said, “We can’t get anything in the way of product. Orders are two to three weeks out. If a person builds a house, they need to order what they need for it 16 weeks ahead. This has been the case for the last two years, since COVID. In 2022, I expect this to be just as bad as in 2021.” In somewhat of a silver lining, he noted, “If you get lumber, you’ll sell it. It’s a sellers’ market.”

In Oklahoma, he said the markets are “probably better. The price of a sheet of plywood was $55; now it’s $17 to $19. That’s better.” 

He offers No. 2 Yellow Pine, No. 2 Doug Fir, No. 2 SPF and other items. He sells his product to retail lumberyards and some end users. Asked how his customers are faring business-wise, he remarked, “They’re busy.

“Trucking has been a challenge, in that a trucker will drop your load if he gets paid more by another company,” he observed.

Here are two examples of feasting, in terms of robust sales.

First, a Kansas City lumber contact said his business is “very strong. The market is good. Generally speaking, there has been a mild start to winter. There have been no work-shutdowns due to the weather.”

He handles green Doug Fir, SPF, dry Doug Fir and other products. “Green Doug Fir has the highest volume of sales,” he noted.

He sells Softwood lumber to retail lumberyards and big box stores. “The retail lumberyards are very busy,” he stated, “busier than usual. Box stores have had pullback from the frenzy of all of last year, but they’re still doing well.”

Transportation is problematic, he said. “Flooding in western Canada damaged railways and roads. We rely on rail in Kansas City.”

An even greater story of feasting comes from Texas, where a lumber provider called his market “hot.” “That’s one word I would say: ‘hot.’ It’s busy; super, super busy. I’m in Central Texas in the Austin area, which is blowing up – in a good way – business-wise. I’ve been here my whole life, and I’ve never seen anything like it. Home prices, which have increased, have calmed down a little bit because of the time of year. There’s a lot of influx: California money and New York money. They’re driving home prices up.” 

Compared to six months before, the market “may be a hair slower,” he stated. “We’ve been pretty level all year; it’s just been a high level. It’s been a great year.”

He handles No. 1 and Better Doug Fir, KD and green; appearance grade KD boards; vertical grade Cedar boards; appearance grade Cedar timbers; mixed hardwoods for industrial purposes and other product.

“We sell to lumberyards; we’re wholesale only,” he stated. “The three lumberyards I went to today, they can’t keep up. They’re overloaded with business as well.

“Labor is a problem,” he noted. Also, “Transportation can roll two different ways for us. We have to supply our own truck drivers, which can be a problem at times. We have a fleet of four or five trucks, which helps. Also, the rail cars are taking longer to get to us. It’s starting to pick up, but it was a little slow for a while, for sure.” 

By Paul Miller

Paul Miller President Miller Wood Trade Publications

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